Rheinmetall, Hesse Sign EUR 285 Million Letter of Intent — Boxer Output to 500 a Year From 2029
Kassel, 27 August 2026
Key points
- Rheinmetall and Hesse signed a letter of intent worth about EUR 285 million — roughly EUR 260 million from Rheinmetall, EUR 25 million from Hesse
- The plan covers expanding the Kassel plant, a logistics and training centre at Calden airport, and a drone test centre; only the logistics centre carries a date, operating by end-2027
- Kassel, which builds about 120 vehicles a year today, becomes the main Boxer production site from 2029 at more than 500 vehicles a year
- More than 1,000 new jobs are planned across the two sites; Papperger: Kassel "is, and for the foreseeable future will be, Europe's largest tank factory"
- A letter of intent commits neither party to a contract, site plan or date; the 500-a-year line is built around Berlin's expected Boxer order, not yet placed
Rheinmetall and Hesse's minister-president Boris Rhein signed a letter of intent worth about EUR 285 million to expand the Kassel plant and build a logistics centre and drone test site at Calden airport — a commitment that would take Boxer output from roughly 120 to more than 500 vehicles a year from 2029.
The three elements are not equally dated: the Calden logistics centre is due by end-2027, the drone test centre and plant expansion carry no timeline. Fixed is the production target — Kassel, which builds Panzerhaubitze 2000, Büffel and Kodiak variants today, becomes Rheinmetall's main Boxer site from 2029, workforce growing toward roughly 3,500. Papperger's claim that Kassel "is, and for the foreseeable future will be, Europe's largest tank factory" describes Rheinmetall's own plant in a city where KNDS Deutschland builds Leopard 2 and RCH 155 at its own — Boxer itself is built by ARTEC, the two firms' joint venture. A letter of intent commits neither party to a signed order; the 500-a-year figure is built around a roughly EUR 12.4 billion Boxer contract Papperger has treated as effectively certain since 6 August, but which has not yet reached the budget committee.
Kassel's expansion is a capacity bet placed ahead of the vote it depends on. Signal No. 133 set the letter against roughly 100 further procurement submissions the ministry plans before year-end, of which the Boxer order would be among the largest; the figures to check in autumn are the number the Vorlage carries at committee, and how the 500-a-year target splits between Rheinmetall and KNDS across ARTEC — a division Thursday's letter does not specify.
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