And what was supposed to happen... happened! In an article from economic digital daily “La Tribune”, Defense industry specialist Michel Cabirol reveals that the German group Rheinmetall is currently blocking the Main Ground Combat System program or Franco-German MGCS program intended to design the future battle tank for the French and German forces. This program was entrusted by the authorities of the two countries to the KNDS group, formed equally by the French Nexter, manufacturer of Leclerc, and the German group Krauss Maffei Wegman, manufacturer of Leopard 2.
However, in November 2018, the industrial group Rheinmetall, involved in particular in the Leopard 2 and the Boxer, announced to enter into negotiations with the Baude family, owner of KMW, to acquire the rights, which obviously would pose significant problems in the industrial sharing around the MGCS, in the balance within the KNDS group, and which could even undermine all current Franco-German cooperation projects.
If the German government has remained evasive on the subject, considering the consolidation of the sector as relevant, because it gives rise to a Defense giant worth almost €10 billion, Paris, on the other hand, has clearly set the limits, whether concerning the KNDS group, of which he is a 50% shareholder, and the MGCS program: it will be 50% for Germany, and 50% for France. And there, this no longer suits Rheinmetall at all, which aims to take control of the project as well as the group, on the basis of its greater financial scale, a scale which has been further strengthened in recent weeks with the creation of a Joint Venture with the English BAe in the field of land weapons, and in which the German group holds the absolute majority.
In addition, if the French authorities agreed to give project management to Krauss Maffei Wegman, designer of the Leopard 1 and 2, on the MGCS as a counterpart to that of Dassault Aviation on the FCAS, they are not ready to entrust it to Rheinmetall, considered too inexperienced in the field by Paris. Above all, with the project management, Rheinmetall could easily favor your own network of companies and subcontractors, which represents the strength of the group, to the detriment of KMW subcontractors, but especially Nexter subcontractors. However, the latter represent 40% of the economic efficiency of Defense programs today in France, which, obviously, would place a significant weight on the sustainability of the program by the country's public finances.
The fact remains that the present situation was largely predictable, and even planned, and that it can jeopardize the entire industrial and budgetary balance created around the Franco-German defense programs launched since the arrival of President Macron at the Elysée. This risk was presented both by B. Meyer, the CEO of Nexter, and by E. Trappier, the CEO of Dassault Aviation, during their respective hearings by the Defense committee of the National Assembly. But, today, the French authorities, like the national industrialists, have no other choice than to hold firm to the positions defined, and to wait for the German authorities to restore order in their own BITD. That said, there is no guarantee that common sense will prevail in this matter...