Antitrust Alarm Sounds Over Rheinmetall's Market Grip as Bundeswehr Recovery Vehicle Deal Lands

German watchdog warns Rheinmetall's market dominance stifles competition and inflates costs, even as a new Bundeswehr order highlights deepening reliance.

Germany's competition watchdog has raised the red flag over the country's growing reliance on Rheinmetall, warning that the defence giant's dominance is stifling competition and inflating costs. The warning came just as the Düsseldorf-based group secured a fresh Bundeswehr order for 23 modernised recovery vehicles, a contract worth a mid-three-digit-million-euro sum that was announced on 23 June 2026.

The Bundeswehr's decision to award Rheinmetall the contract follows the earlier transfer of 21 Bergepanzer 2 and two Bergepanzer 3 vehicles to Ukraine, which depleted Germany's own stocks. Under the new deal, Rheinmetall will deliver the modernised Bergepanzer 3 A2 variant, with the first vehicle scheduled for December 2027 — roughly 18 months after signing. The final unit is due in June 2029. To meet the tight timeline, the company has already started production, having pre-financed the work.

Yet the order's arrival has drawn renewed scrutiny from the Monopolkommission, the independent advisory body on competition. Chairman Tomaso Duso argued that the bulk of Germany's defence spending flows to a handful of dominant players, sharply limiting competitive pressure. Commission member Rupprecht Podszun went further, warning explicitly of a "system dependency" on Rheinmetall. The criticism echoes concerns from the Bundesrechnungshof, which recently accused the group of price gouging on major projects and lamented the lack of market alternatives.

Rheinmetall's financial trajectory underscores the unease. Revenue has doubled over the past five years to nearly ten billion euros, and its order books are bulging. At the same time, the stock has taken a battering. Shares closed at €1,169 on Tuesday — roughly 27% below their year-to-date start and 41% off the 52-week high of €1,995. The relative strength index stood at 42.4, suggesting no clear momentum in either direction. The 200-day moving average of €1,577 is about 26% above the current price, reinforcing the medium-term downtrend despite the company's packed order book.

To insulate itself from over-reliance on the German military, Rheinmetall is pushing into new technological fields. The group has formed a joint venture with Finnish specialist ICEYE, aiming to develop satellite-based reconnaissance systems. A separate cooperation with VR developer Varjo will digitalise training in driving simulators. Finland is backing such dual-use technologies with €120 million in funding, signalling a broader shift from pure hardware manufacturing to integrated tech provision.

For now, the Bundeswehr contract secures production capacity through the end of the decade and deepens ties with Rheinmetall's most important client. But the antitrust warnings pile pressure on the defence ministry to put future contracts out for international tender. The group's vast order backlog provides near-term stability; its partnerships in space and virtual reality point to a long-term strategic evolution. The market, however, has yet to be convinced.