Rheinmetall to expand satellite business, citing Ukraine support deal

THE HAGUE, Netherlands — Rheinmetall and Finnish satellite manufacturer ICEYE signed a memorandum of understanding on Thursday, establishing a joint venture focused on satellite production.
The new company, named 'Rheinmetall ICEYE Space Solutions,' represents a significant step in the German defense giant's expansion into the space domain and a continuation of Germany's and Europe's broader rearmament efforts.
Under the agreement, Rheinmetall will hold a 60% majority stake in the venture, with ICEYE owning the remaining 40%. The joint venture will focus initially on manufacturing Synthetic Aperture Radar (SAR) satellites before expanding to other space capabilities.
Defense companies jack up Germany's auto industry to make weapons fast
SAR technology allows surveillance satellites to see through clouds and can increase the resolution of the output image. It has been ICEYE's area of specialization, with Rheinmetall describing its partner as a 'globally leading SAR satellite manufacturer' in its press release.
Production is scheduled to begin in the second quarter of 2026, with Rheinmetall's Neuss facility in western Germany serving as one of the primary manufacturing sites. The factory was previously focused on automotive manufacturing.
This satellite-building initiative is part of a broader 'Rheinmetall Space Cluster' being created by the German defense company.
'With the establishment of the new joint venture, we are making further inroads into the space domain,' said Armin Papperger, CEO of Rheinmetall AG. 'We are thus not only responding to the increased demand for space-based reconnaissance capabilities among armed and security forces worldwide, but also contributing to the preservation and expansion of Germany as a centre of technology.'
The partnership builds on an existing collaboration that reached a significant milestone in November 2024, when Rheinmetall and Ukraine signed a contract – with German government support – to provide critical SAR satellite data to Ukraine's Ministry of Defence. The arrangement extends the satellite reconnaissance capabilities that ICEYE has been providing to Ukraine since 2022, helping inform operational planning as Ukrainian forces face the continued onslaught of Russian troops in the third year of Moscow's full-scale war.
Also in 2024, Rheinmetall secured the exclusive rights to market SAR satellites to government and military users in Germany and Hungary.
Thursday's move aligns with Rheinmetall's ambitions of grabbing market share amid skyrocketing demand for military hardware in Europe, with an aggressive Russia to the east and an increasingly unpredictable United States to the west.
As part of this effort, Rheinmetall has started to repurpose some of its automotive manufacturing capacity. 'Our highly qualified colleagues at the Neuss site are being given a promising new perspective for the future,' said the arms maker's CEO of the pivot.

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