Rheinmetall Explores Selling Off Its Power Systems Unit Amid Booming Arms Business
Discussion ensues regarding potential sale of Rheinmetall's civil power division.
In an exciting turn of events, the Rheinmetall group, renowned for its booming arms business, might be parting ways with its civil business Power Systems. During his virtual annual general meeting speech on May 13, CEO Armin Papperger announced, "Rheinmetall has been receiving inquiries from potential buyers for some time and is engaged in discussions with them. All inquiries are being seriously considered."[1]
The Power Systems division, which churns out parts for the struggling automotive industry, no longer appears to be a core business for Rheinmetall. With a focus on converting individual plants of the division to arms production, Rheinmetall aims to secure a future for its employees within the security and defense sector.[1] Sites in Neuss and Berlin already demonstrate this shift, as they have moved towards arms production.[1]
The Neuss plant, traditionally a hub for civil production and employing around 1,500 people, is gradually aligning with Rheinmetall's ambitions. The company has recently formed a joint venture with the Finnish firm ICEYE, set to manufacture satellites at the Neuss plant starting from the second quarter of 2026.[1]
Despite the potential sale of Rheinmetall Power Systems not yet being official, this shift aligns with the company's surge in the defense sector. Rheinmetall's strong performance in Q1 2025, with a 46% increase in group-wide sales and a 73% increase in its defense business, showcases the division's significance.[2][3] This growth, credited primarily to contracts with the German government, has bolstered the company's spirits, leading to increased confidence in their full-year 2025 growth targets.[1][3]
Whether Rheinmetall Power Systems will find a new owner remains to be seen. If discussions were to begin, potential buyers might include companies eyeing expansions within the power systems sector or those seeking strategic acquisitions to strengthen their technological capabilities.[4] Only time will tell as discussions continue. Keep an eye out for more updates on this developing story!
[1] ntv.de[2] rts.de[3] Rheinmetall Annual Report Q1 2025[4] Based on industry analysis and market trends, enrichment data
- Rheinmetall's employment policy might undergo significant changes as the company deliberates potential sales of its Power Systems unit, given its thriving arms business and the focus on converting individual plants to arms production.
- Amid discussions with potential buyers, Armin Papperger, the CEO of Rheinmetall, has confirmed the receipt of inquiries for the Power Systems division, indicating a possible shift in the company's employment policy.
- The finance and business sectors may take notice as the Power Systems unit, which currently employs around 1,500 people in the Neuss plant, could attract strategic acquisitions by companies looking to bolster their technological capabilities.
- As Rheinmetall's defense policy continues to grow, with a 73% increase in Q1 2025, community policies may adapt to accommodate the potential influx of employees from the Power Systems division, should it be sold to another company.
