VIENNA — In a significant development, Lockheed Martin has teamed up with Rheinmetall to begin the manufacture of the U.S. Army Tactical Missile System (ATACMS) at the Rheinmetall facility in Unterlüß, northern Germany. This marks the first instance of the ballistic missile being produced outside the United States.
The collaboration was formalized through a memorandum of understanding during the NATO Summit Defense Industry Forum in Ankara. With support from both the U.S. and German governments, the initiative is seen as a move towards establishing a European “centre of excellence” for the production, integration, and distribution of ATACMS to NATO and its allied forces.
Armin Papperger, CEO of Rheinmetall, highlighted that choosing Unterlüß as the site for this venture strengthens Germany’s defense industrial base in modern systems. Meanwhile, Lockheed Martin’s European head, Dennis Goege, described the agreement as a blend of “proven U.S. technology with European manufacturing prowess.”
The Unterlüß site, which has been operational for 125 years and currently employs about 4,000 workers, is undergoing significant expansion. Just last year, a new plant dedicated to artillery ammunition was inaugurated, and a rocket-motor factory nearing completion is expected to start producing motors and guided-missile components by as soon as 2027. According to Papperger, full-scale missile production is anticipated to commence in 2027 and increase steadily in 2028 and 2029, aiming to fulfill the estimated annual demand from European and Ukrainian forces for 600 to 800 ATACMS units.
This expansion comes at a crucial time. Lockheed Martin has been gradually decreasing production of the ATACMS at its Camden, Arkansas, facility as it shifts focus to the newer Precision Strike Missile, intended to eventually supplant ATACMS in the U.S. military’s inventory, despite continuing high demand for the older missile model in Europe and Ukraine.
Upon completion, the German site will become the first location outside the U.S. to produce the ATACMS missiles. Lockheed Martin has confirmed it will continue operations at the Arkansas facility until the full transfer of production capabilities to Europe is achieved.
The partnership between Rheinmetall and Lockheed has been developing for over a year. The companies initially signed a missile-cooperation memorandum in 2024, which was expanded in April 2025 to include a broader “Center of Competence” for missiles and guided weapons. By last August, discussions had already turned to specific provisions for ATACMS and Hellfire missiles at Unterlüß. Whether the current memorandum will evolve into a fully approved joint venture remains contingent on the approval of the U.S. government, which must authorize any transfer of ATACMS technology.
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Jamal Peterson reports on defense, aerospace, and tech policy. With a military background and a strategic mind, he dissects complex subjects with clarity, offering readers sharp, reliable insights.
