Rheinmetall Takes Over Ammunition Factory in Varpalota, Hungary

Rheinmetall officially took ownership of its new 30mm ammunition factory in Várpalota, Hungary, on July 29.

The inauguration ceremony was attended by Hungarian Minister of Defence Kristóf Szalay-Bobrovniczky and Rheinmetall AG CEO Armin Papperger.

The Várpalota facility is scheduled to begin production in October 2024. The factory will manufacture 30mm ammunition for the KF41 Lynx infantry fighting vehicle, which will be assembled in Zalaegerszeg and supplied to the Hungarian armed forces. In its second phase, the factory will also produce ammunition for battle tanks and artillery, as well as igniters. The final expansion will cover approximately 150 hectares.

While Hungary has ruled out supplying weapons, including ammunition, to Ukraine, it remains unclear whether Rheinmetall, one of Ukraine’s largest ammunition suppliers, will send ammunition produced in its Hungarian factory to the conflict zone.

“The country has made a clear political value choice by not sending ammunition and weapons to the Russo-Ukrainian war that is raging in our neighborhood,” Hungarian Defense Minister Kristóf Szalay-Bobrovniczky said on July 29 during an event marking the start of a test run for a production line designed to manufacture 30mm ammunition in Várpalota.

Last week, Rheinmetall secured its first order from the Ukrainian government for the construction of an ammunition factory, following an announcement in February 2024. The first Lynx Infantry Fighting Vehicle from Rheinmetall is expected to be delivered to the Ukrainian armed forces by the end of the year, with local production to start soon.

Earlier this month, Western media reported that U.S. intelligence had thwarted plans by the Russian government to assassinate Rheinmetall CEO Papperger due to the company’s support for Ukraine.

Rheinmetall has been supplying artillery shells and military vehicles to Ukraine, besides also opening a facility to repair Leopard and Marder battle tanks.