The joint venture for the production of Lynx infantry fighting vehicles in Hungary opens up international business opportunities

 21. 09. 2020      category: Events

The government of Hungary has signed a major defence deal with Rheinmetall and ordered 218 newly developed infrantry fighting vehicles. The Hungarian Ministry of Defence has embarked on a massive programme worth over two billion euros to modernize the country’s defence industry and military capabilities, thus becoming the very first NATO and EU member state to choose the Düsseldorf-based group’s innovative new combat vehicle.

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Picture: For Rheinmetall, this deal comprising 218 Lynx KF41 infantry fighting vehicles (on the picture) and nine Buffalo armoured recovery vehicles with various additional products and services such as simulators, training, as well as the initial supply of spare parts and maintenance support represents a major breakthrough in the global defence market. | Rheinmetall

This step is of central importance in Hungary’s ongoing programme of military and industrial development, which aims to transform the Hungarian Army as quickly as possible into a world-class fighting force capable of actively addressing security challenges in the Euro-Atlantic region.

Video: Evolution of the Lynx / YouTube

For Rheinmetall, this deal comprising 218 Lynx KF41 infantry fighting vehicles and nine Buffalo armoured recovery vehicles with various additional products and services such as simulators, training, as well as the initial supply of spare parts and maintenance support represents a major breakthrough in the global defence market. 

In the first phase, Hungary will receive forty-six Lynx infantry fighting vehicles as well as nine Buffalo armoured recovery vehicles, all built in Germany. This delivery is to be completed by the beginning of 2023. In the second phase, the remaining 172 vehicles will be built in Hungary. 

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Picture: Lynx KF41 | Rheinmetall

As Armin Papperger, chairman of the executive board of Rheinmetall AG, explains: “The Lynx’s market breakthrough is a major success for us.  And the fact that we were able to convince Hungary – an important EU and NATO partner – to choose this innovative vehicle makes this success all the greater. In making this forward-looking procurement decision, Hungary’s top political and military officials have demonstrated real leadership. Not only does it place Hungary at the forefront of European army technology; it also reaffirms the Hungarian government’s commitment to being a reliable, more military effective partner for its NATO allies, a policy which it is pursuing with systematic energy.”

Mr Papperger was quick to emphasize the Group’s appreciation to the Hungarian authorities for the great trust in Rheinmetall the order implies: “We’re very proud to be able to make an important contribution to the Hungary’s defence technology capabilities in cooperation with local industry. We look forward to working together with our Hungarian friends and partners, and will do everything in our power to assure the long-term success of this venture.”

In August 2020, the Hungarian government and Rheinmetall agreed to establish a joint venture facility in Hungary. Within this planned joint venture, aimed at the development, production and maintenance of armoured vehicles, Rheinmetall will hold a majority stake and take the lead, while Hungary’s investment will come in form of newly constructed production facility. The core aim is to create an important hub for Hungarian defence industry, thus ensuring that a substantial share of added value derived from this procurement project will remain in customer country.

For the Lynx, the agreement is a big step because the Hungarian armed forces will be its first customer. "This agreement opens up a new way for us to work together. The next phase will be to proceed with the Hungarian side as quickly as possible in order to complete the necessary administration and start production," said Oliver Mittelsdorf, Senior Vice President of Rheinmetall Defence.

Video: LYNX KF41 - Czech republic / YouTube

As a strong supporter of international industrial cooperation, Rheinmetall is convinced that the Hungarian agreement opens up international business opportunities for Czech companies as well. Czech suppliers are already involved in the production of Rheinmetall infantry fighting vehicles and can reap the benefits of joining its global supply chain.

 Author: Martin Šiška