Whether Rheinmetall or Heckler & Koch - German arms manufacturers are receiving more orders than ever before against the backdrop of the Ukraine war.

Rheinmetall has built a factory in Weeze (North Rhine-Westphalia) costing around €100 million to manufacture key components for the F35 stealth bomber. CEO Armin Papperger and North Rhine-Westphalia's Minister-President Hendrik Wüst (CDU) are celebrating the completion of construction today. This example demonstrates that, in light of rising government spending on its military, Germany's defense industry is booming, with major companies investing heavily in expanding their production capacities. An overview of the industry's rapid growth with selected examples.

Germany's largest defense company had a backlog of €62.6 billion at the end of March. This includes the order backlog, framework agreements, and expectations from other business relationships. At the end of 2021—before the war in Ukraine began—it was less than half that, at €24.5 billion. Sales and profits are also rising sharply, and the number of employees is expected to increase by a quarter to 40,000 within two years. The share price has increased approximately 18-fold since the Russian attack on Ukraine in February 2022.

Only the weakening business as an automotive supplier is dampening the mood. A portion of the automotive workforce is expected to move into the defense sector in the future. Rheinmetall is expanding its largest site in Unterlüß, Lower Saxony, with a new ammunition factory for around 300 million euros. The center fuselage section for the F35 is manufactured in Weeze (North Rhine-Westphalia). The company is one of Ukraine's most important arms suppliers, and this is partially funded by the German federal government.

The war in Ukraine demonstrates the importance of electronic warfare. This trend is benefiting Hensoldt, a supplier of sensors and radar systems based in Taufkirchen near Munich. Revenue increased by about half to approximately €2.2 billion over the same period. The company, with its approximately 9,000 employees, aims to generate at least €2.5 billion this year and €6 billion by 2030. Hensoldt radars are being used in the war in Ukraine to protect the population from Russian air attacks and are installed in the Eurofighter fighter jet.

The German federal government holds a blocking minority of just over 25 percent in the company, which was formerly part of Airbus. Over the past three years, Hensoldt has invested one billion euros, including in a new optronics facility in Oberkochen. The company also manufactures periscopes for armored vehicles and submarine periscopes.

The Kiel-based subsidiary of the Essen-based industrial group Thyssenkrupp claims to be the global market leader for non-nuclear submarines and is fully booked until the early 2040s. In December, the Bundestag's Budget Committee approved the construction of four additional Class 212CD submarines for the German Navy. This brings the total number of such boats ordered to ten – six for Germany and four for Norway. TKMS also recently received an 800 million euro contract from the German government to modernize six Navy submarines.

According to TKMS, the order book is worth approximately €18 billion. The shipyard is also bidding to build submarines for Canada. In addition to its main shipyard in Kiel, the defense company, with a total of 8,500 employees, also operates a shipyard in Wismar, Mecklenburg-Western Pomerania, which it acquired in 2022.

Dynamit Nobel Defence GmbH remains largely hidden from public view. It is known that DND provided Ukraine with a total of 16,917 "Matador" anti-tank grenades by April 2025, paid for by the German government. For the company, which employs more than 300 people, the war in Ukraine represents an enormous growth spurt. In a mandatory disclosure from March 2023, the company stated that sales in 2022—the year the war began—amounted to approximately 140 million euros, more than double the 2021 figure (58 million euros). Dynamit Nobel Defence GmbH is part of the Israeli defense group Rafael.

Less than ten years ago, Heckler & Koch was deep in the red and its debt mountain was enormous. The situation was so tense that the workforce even agreed to unpaid overtime. That's all water under the bridge; now the profitable weapons manufacturer is racing from one company record to the next. The main plant in Oberndorf in the northern Black Forest is making significant investments, for example, in a new shooting center. Investments are expected to increase even further in the coming years. Not only the Bundeswehr is being equipped with new weapons, but also the Baltic states and Norway – Russia's neighbors. Since the beginning of 2022, the number of employees has increased by a good fifth to approximately 1,300.

The German subsidiary of the European defense company MBDA is also on a strong growth trajectory. Before the war in Ukraine began, it had around 1,100 employees; now, that number is about 300 more. This number is expected to rise to more than 1,700 by the end of this year. MBDA is investing in a new production facility in Schrobenhausen, Bavaria, to manufacture guided missiles for the US Patriot air defense system – the company has received a contract for this for the German Armed Forces and NATO partners. At its German site, MBDA also produces guided missiles for the Eurofighter, for which the company recently received a major contract. MBDA also manufactures the Taurus cruise missile.

Drone manufacturers are in high demand, even among investors, as the companies are said to have significant growth potential. The Munich-based defense company Helsing recently raised another 600 million euros from investors. Helsing is already building the HX-2 kamikaze drone, which is being used by Ukraine and is to be tested by the German Armed Forces. The company also recently unveiled an underwater system and an artificial intelligence system designed to guide a fighter aircraft in complex aerial combat scenarios. Quantum Dynamics, based in Gilching, Bavaria, manufactures surveillance drones.