Rheinmetall’s Space Venture and Tank Troubles Collide as Stock Struggles to Find Floor

Rheinmetall shares fall 25% year-to-date, 40% below all-time high. A new satellite JV with OHB contrasts with France’s expected MGCS budget cuts, pushing the Leopard 3 alternative.

Rheinmetall closed the trading week at €1,196.60, shedding 3.11% on Friday and leaving the stock nursing a 25% loss since the start of the year. The shares now sit 40% below their all-time high and more than a quarter below the 200-day moving average of €1,603.84. A modest 9% rebound from the 52-week low of €1,099.80 touched on May 13 has done little to change the technical picture; the relative strength index of 42.6 points to a market waiting for direction rather than panicking.

Two headline events are pulling the company in opposite directions. On one hand, Rheinmetall has formalised a joint venture with OHB to build a military satellite communications network for the German armed forces. On the other, the future of the Franco-German Main Ground Combat System (MGCS) tank project looks increasingly uncertain after France reportedly plans to slash its budget by more than half.

The new entity, OHB Rheinmetall Space Networks GmbH, is headquartered in Bremen and was cleared by antitrust authorities in mid-April before being entered into the commercial register. Its goal is to provide the Bundeswehr with a secure, permanently available communication architecture covering voice, data and real-time information across all command levels, including a dedicated cyber operations centre. The joint venture is structured as a long-term network operator rather than a one-off equipment supplier, and the partners see potential for NATO and Framework Nations involvement down the line.

The space venture is tied to the SATCOMBw programme, which envisions a constellation of hundreds of low-Earth-orbit satellites operating by the end of the decade. A first batch of 40 satellites is targeted for 2029, with the official contract award expected around the turn of the year. The management team combines deep space expertise: Dennis Winkelmann, who has over 25 years of experience in the sector including 19 at OHB, and Alexander Beyer, a former Bundeswehr officer who most recently led satellite communications at Rheinmetall.

Meanwhile, on the ground, the Leopard 2 replacement project MGCS is in jeopardy. Chief executive Armin Papperger has openly questioned France’s commitment, noting that only €25 million has flowed to the participating defence companies in nearly a decade. Paris is reportedly weighing a cut of more than 50% to its MGCS allocation. To fill the gap, Rheinmetall is pushing ahead with an alternative: the Leopard 3, developed jointly with KNDS Deutschland. That tank is expected to be operational by the early 2030s and would serve as a bridge solution for the German army.

The two narratives converge at a time when Rheinmetall is also preparing for a major marketing push. The Eurosatory defence exhibition opens in Paris on 15 June, where the company will showcase systems spanning land, air, sea, space, cyber and information domains. A key highlight is the debut of the Containerized Missile Launcher for the FV-014 Loitering Munition System, scheduled for presentation at the Rheinmetall stand on Monday at 16:15. Whether the combination of a new space partnership, a tank contingency plan and a strong exhibition presence can lift the stock back above the 50-day moving average of €1,322.40 will become clear in the first trading sessions of the coming week. But with the French budget decision on MGCS still pending and the satellite contract award months away, the market has plenty of unknowns to digest.