“3D PowerPoint project”: Head of the Munich tank builder Krauss-Maffei doesn’t think much of the Rheinmetall KF 51 tank

Created: 12/21/2022, 4:46 am

By: Thomas Schmidtutz

Waiting for the turning point: Ralf Ketzel, boss of the Munich Leopard 2 farmer Krauss-Maffei Wegmann.

© Marcus sleep

The turning point in German defense policy is still a long time coming.

"We haven't had any orders yet," says Ralf Ketzel, head of the Munich tank builder Krauss-Maffei Wegmann.

Munich - The Munich tank builder Krauss-Maffei Wegmann (KMW) has promised a significant increase in personnel for its main plant.

However, this presupposes that the controversial tank test track on the factory premises in Munich-Allach remains, CEO Ralf Ketzel made clear in an interview with

.

With a view to the planned development of the successor to the Leopard 2, Ketzel took a hard swipe at his long-term partner Rheinmetall.

Anyone who is a member of a consortium for the development of the future European battle tank and is now also developing their own battle tank “single-handedly” with the KF51 can no longer be a partner in this consortium, said Ketzel.

Mr. Ketzel, in view of the Ukraine war, Federal Chancellor Olaf Scholz proclaimed a turning point in February and announced a 100 billion package for the general restructuring of the Bundeswehr.

The Bundestag and Bundesrat gave the green light for this in June.

Has the turning point reached you in the meantime?

Since then we have had various discussions about programs.

So far we have not had any concrete orders that could be assigned to the turn of the century.

In his speech at the turn of the century, the Chancellor also promised that the defense budget should increase to two percent of German economic output, as agreed within NATO.

For 2023, however, the regular budget of the Federal Ministry of Defense will fall again to 1.6 percent.

How frustrated are you?

I'm not frustrated.

But it is not a good signal for the Bundeswehr and our allies.

A total of 10.6 billion euros are planned for procurement in the coming year.

In addition, there are another 8.4 billion from the special fund.

Makes a total of 19 billion euros.

What's in it for you?

To be honest we are disappointed.

Of course, our Puma armored personnel carrier is also included in the budget, but only with 50 units.

Actually, when the system was originally planned, several 100 units were the target specification.

But we firmly assume that the announced orders will come in the coming years.

Critics consider the so-called special fund to be window dressing anyway, because inflation, taxes or interest payments are still being made.

The actual volume is therefore closer to 65 billion euros.

Do you share this bill?

We also assume this is the order of magnitude.

Will the Bundeswehr be able to improve its clout at all?

The Bundeswehr needs the special fund above all for urgent, strategic purchases.

It's about topics like digitization, nuclear participation or new helicopters.

In order to make the Bundeswehr more modern, however, we need the two percent that we have promised to NATO.

This is the only way we can create the basis to ensure continuous procurement and to compensate for price increases and inflation.

In any case, this problem will not be solved with the billions from the special fund.

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The preparatory work for the planned next-generation Franco-German fighter jet has just taken the next step.

For the second major European project planned, the main battle tank (MGCS), you are on board with your French holding partner Nexter and Rheinmetall.

But progress is very slow.

Where's the problem?

Both programs are linked to each other.

That slowed down the MGCS.

The aim of this project is not just to build a new tank.

We can do that faster.

It's about a completely new technology, networking, the use of drones and systems that can be operated with or without a crew.

France and Germany actually want to share industrial leadership in the two major European armaments projects.

France should be in the lead with the next-gen jet, and KMW with the tank project.

Do you have the lead?

We have a partner in this project in France, Nexter, and on the German side, Rheinmetall and KMW, two companies.

This leads to greatly increased complexity and weakens leadership.

Because on the one hand there is a clear position, on the other hand discussions.

So the chosen leadership structure for the MGCS is not really happy?

KMW has been the leading European systems house for heavy tanks such as the Leopard 1 and Leopard 2 and artillery for decades.

Nevertheless, the decision was made in Germany to bring Rheinmetall on board as well.

In France, on the other hand, Nexter is the only partner that supports the French army in all aspects.

In a Franco-German joint project, the natural bridge would have been Nexter and KMW.

The involvement of Rheinmetall is therefore not clear to me.

The project will not be any easier in the future either – on the contrary.

Your partner Rheinmetall, of all people, is now your competitor on the tank market.

The Düsseldorf company presented the KF 51 Panther main battle tank in June.

How do you see it?

We take a very critical view of this.

Rheinmetall is starting in a field where we actually planned a Franco-German cooperation.

The idea was that the next generation of heavy combat systems would come from Germany and France.

Now one of the three partners is coming up with its own solution.

From an economic point of view, that makes sense.

But if you violate the partnership in a consortium like that - and that too on the doorstep of a partner - you can no longer be a partner in that consortium.

That being said, the KF 51 is essentially a conventional tank concept built around a 130mm gun with a Leopard 2 hull.

This is nothing new.

How do you explain Rheinmetall's struggling in between?

We've already experienced that with the Puma.

When the concept was internationally marketable, the Lynx appeared.

This makes the ability to cooperate at the national level difficult.

For a long time we had the plan that Boxer and Puma could be marketed jointly by both houses.

Then Rheinmetall went it alone.

Does it sound like your relationship with Rheinmetall is now a bit poisoned?

At the MGCS, we are indeed very critical of this.

The project is politically sensitive.

In Germany, there has been a clear distribution of roles in heavy combat systems for decades, think of the Leopard or the self-propelled howitzer.

We find it very unfortunate, to put it mildly, that Rheinmetall is now pushing ahead.

The KF 51 is more of a 3D PowerPoint project.” 

KMW boss Ralf Ketzel on Rheinmetall's Panther main battle tank, which was presented in the summer.

However, at 51 tons, the KF51 is significantly lighter than the Leo 2 and more heavily armed and, with a unit price of 15 million euros, is also significantly cheaper than the Leo 2 with a unit price of 19 million.

The army inspector has already publicly praised the weight advantages of the KF 51.

The Leopard is and will remain state-of-the-art for the foreseeable future.

We expect the Leopard to remain the backbone of land forces for many armies for decades to come.

The KF 51, on the other hand, is more of a 3D PowerPoint project.

There is no reliable basis for weight or price.

In the end, the decisive question will be: Do we want to give up the functioning cooperation between the 14 European nations in which the Leopard is in use in favor of a new vehicle that does not offer the planned quantum leap at all?  

But the vision of a Europe-wide uniform successor to the Leopard 2 is already shaky?

It's true: Poland has just opted for the South Korean K2 main battle tank.

In Norway, the selection is still ongoing.

We hope the Norwegians don't make the same mistake.

But if we in Europe now diversify again in key armaments issues, we shouldn't be surprised if Korea, Australia or the USA dominate these issues in the future and we can no longer afford European industry in this field.

Then we have a similar situation as with fighter jets where the F35 continues to gain ground.

If Europe is serious about the idea of ​​emancipating itself from the US, can't we afford to go it alone?

Right.

We need a unified concept for modernizing the European armored fleet.

It's been going well so far because we have a standard tank here.

But now we have to build the bridge to the MGCS.

A tank like the KF51 doesn't fit in here.

Rheinmetall is now very expansive.

A few days ago, the company took over the Spanish ammunition manufacturer Expal Systems.

The depots are largely empty across Europe.

Ammunition is therefore considered a major growth market in the industry.

Don't you have to strengthen yourself here too?

Our partner Nexter also makes ammunition for both tanks and howitzers.

If we think about developments in Europe, cooperation will become more relevant in the future.

There was also a cooperation between Nexter and Rheinmetall in the past.

However, no uniform standard has developed from this, but rather national lines in Germany or France.

The big challenge here would be to achieve further standardization of ammunition between Germany and France - both for tanks and artillery, ideally also within NATO.  

Consolidation in the defense sector continues.

Observers have been speculating about a possible merger between Rheinmetall and KMW for many years.

Rheinmetall boss Pappberger would see you as a junior partner.

How useful would such a merger be?

Rheinmetall sees itself as global.

KNDS and KMW serve Europe.

A combination of KMW and Rheinmetall would therefore be more of a national consolidation and no answer to the question is armaments global, national or European.

So it would be more of a consolidation across national borders?

Consolidation only makes sense if we create internationality and build bridges across major borders.

Think Airbus.

But the question is: is this politically honored?

So far, the willingness to invest more in European partnerships than in national solutions has not been particularly pronounced.

But that means for the French, as uncomfortable as it is: Germany is the leading nation in Europe with KMW and the Leopard 2 in tank technology.

But the ownership structure at KNDS with Nexter and KMW on the one hand and Rheinmetall on the other doesn't make the task any easier?

Right.

On the one hand, KNDS belongs to the French state and, on the other hand, is in German family ownership.

Rheinmetall is a quarterly oriented stock corporation.

Finding a common ownership structure is quite a challenge.

KMW boss Ketzel: Banning the test track would have far-reaching effects

Ralf Ketzel: The KMW boss sees the further operation of the tank test track as a central building block for the future of the main plant in Munich.

© Marcus sleep

Let's look again at a more local topic: You are currently having a lot of trouble with your tank test track at the Munich Allach plant.

Local residents have filed a lawsuit.

According to you, the test track that has existed since 1964 has been built illegally.

The plaintiffs also deny grandfathering.

The Environment Agency of the City of Munich takes a similar view.

Now the matter is before the administrative court in Munich.

How do you see the prospects that the citizens' initiative will get through with your lawsuit?

We recently submitted all the documents for a building permit to the city of Munich.

From our point of view, all formal aspects that the citizens' initiative criticized have been eliminated.

In August, the city confirmed that the documents were complete.

I assume that we will receive the appropriate approval.

By when?

We hope for the coming spring.

However, everyone is free to take legal action.

So this is just a very rough schedule.

But it's important for us that with the test track in Allach we have a key competence that we shouldn't question.

And if the test track is still banned?

Would that have far-reaching repercussions?

Namely?

In the short term, we would then no longer be able to meet existing delivery obligations for the Leopard 2 or the Puma.

The Bundeswehr would initially only receive these vehicles with a delay.

In the medium term, the question would also be how we can maintain our competence here.

We can't just move assembly workers like that.

These are specialists here in Munich.

They won't move.

We would also have significantly less need for developers and engineers.

We would probably not be able to keep these positions in the long term either.

This would rapidly reduce the importance of the location.

The bottom line is about 500 jobs.

That would be almost a third of the workforce here at the site.

Linked to this would also be the fundamental question about the future of the competence center for armored technology.

You would then have to relocate the competencies completely, possibly to France?

We should then ask ourselves this question.

If the test track can no longer be operated, will they have to give up in Munich?

Yes, for a significant portion of the workforce.

 For the next five years we plan to add 50 to 100 employees per year.” 

KMW boss Ralf Ketzel on the personnel plans in Munich.

What would become of the remaining 1000 employees?

We have seen at Airbus that many jobs have migrated to the Airbus headquarters in Toulouse.

We want to prevent a similar development.

What then is left for Allach?

Possibly the German contract processing, i.e. the central acceptance point for the Bundeswehr and management.

And if the tank test track remains?

Then we would continue to build staff here.

On what scale?

We currently employ 1700 people here.

For the next five years, we plan to have 50 to 100 employees per year if possible.