German arms maker Rheinmetall and Finnish satellite manufacturer ICEYE announced a joint venture last week to manufacture Synthetic Aperture Radar (SAR) satellites and other space-defense products in Neuss, Germany.
The new venture, called Rheinmetall ICEYE Space Solutions, will split ownership 60/40 between Rheinmetall and ICEYE, respectively, and expects to begin production of SAR sats in the second quarter of next year.
Blank checks: The partnership kicks off as Germany’s newest chancellor, Friedrich Merz, settles into his new office.
Much of Europe’s leadership already called for an increase in sovereign military spending to counter Russian activities in Ukraine and reduce reliance on the US. In the runup to taking office, Merz proposed that Germany exempt military spending from the country’s constitutional debt limits—essentially ballooning the country’s defense budget.
High ground: Rheinmetall, which has been manufacturing defense products across land, air, and sea domains since the 1880s, is positioned to gobble up the increased military spending.
Though new to the space defense market, the company has relied heavily on ICEYE to establish a toehold and integrate proven space capabilities into the rest of its portfolio.
- Rheinmetall detailed its space strategy for the first time in June 2024, when the company announced an investment in ICEYE through its subsidiary, Rheinmetall Nordic.
- In September, ICEYE granted Rheinmetall exclusive rights to distribute ICEYE SAR sats in Germany and Hungary.
- In November, the two companies entered into an agreement to supply Ukraine with SAR data funded by the German Ministry of Defence.
The new joint venture expands ICEYE’s manufacturing capacity, while providing an avenue for Rheinmetall to begin manufacturing space defense hardware.
What’s next: SAR sats are only the beginning. Through its space cluster project, Rheinmetall signaled its commitment to incorporate space capabilities into the rest of its defense portfolio.
Rheinmetall’s focus so far has been on integrating space-based intelligence, reconnaissance, and surveillance capabilities, by working on customized integrations for its tactical vehicles, for instance. The company also suggested that more partnerships with space-based defense companies may be on the horizon.
