Leonardo, Oto Melara towards the program of the European tank MGCS?

3 March 20222 years ago babelfish

Here are the first hypotheses of membership for Italy with Leonardo's Oto Melara in the European tank program MGCS

Is Leonardo with Oto Melara moving towards the European MGCS tank ?

The announcement of Germany's rearmament plans, which set aside $ 100 billion to bolster the military in response to the Russian invasion of Ukraine, boosted shares of European defense companies this week .

According to the Financial Times , the new German defense engagement is also likely to accelerate plans for the Franco-German next-generation tank program, MGCS. The latter is led by a consortium made up of the German Rheinmetall, Kmw and the French Nexter.

At the same time, "the need of the Defense industry not to remain within the borders of individual countries but to have a European dimension is manifested and the chessboard of companies in the sector is moving, while the possibility of creating a pole becomes more and more concrete. European defense industrialist ”notes Il Sole 24 Ore . "Polo on which the Leonardo group has been thinking for some time and of which the defense systems division of the Italian company could be a partner, composed of Oto Melara from La Spezia and Wass (Whitehead Alenia Sistemi Subacquei) from Livorno, who could participate in the creation of a large European group in weapons systems ”, speculates the Confindustria newspaper.

Thesis also supported by the Center for European Policy Analysis (Cepa) . In an article in early February, the Washington-based think tank argues that “the MGCS project could benefit from the involvement of other European countries. A country with a close interest in this is Italy, a European power with a strong defense industrial base ”. Italy is also looking to replace its main tank, the Aries, around 2035, which coincides with the MGCS timeline.

All the details.

LEONARDO'S ENTRY INTO THE EUROPEAN DEFENSE POLE WITH OTO MELARA AND WASS

In a possible European industrial center, "Leonardo, instead of merely selling the two companies and their respective technologies, could participate in the project, together with the French and Germans, with a minority share, which could reach, according to market rumors, up to 15 % ”Highlights Il Sole 24 Ore .

“Among other things, with the conflict in Ukraine, the share values of Leonardo's two subsidiaries have grown and would allow the group to obtain a valuation from the sale without completely selling the shares of Oto Melara and Wass”, the Confindustria newspaper pointed out.

THE FRANCO-GERMAN MGCS PROGRAM

In fact, the Franco-German program for the new generation MGCS tank is advancing (slowly).

German-led, MGCS is one of two defense collaborations between France and Germany, which aims to replace the French Leclerc and the German Leopard 2 by 2035. The program is the result of the cooperation between Rheinmetall, KMW and Nexter Systems, launched in 2017. The second program is the Future Combat Air System ( FCAS ), led by France, to which Spain has also joined.

Both Italy and Poland have repeatedly asked to join the MGCS program, but Paris and Berlin wanted to keep the project exclusively bilateral until the development of a prototype.

Currently, the program has completed the first two phases and France and Germany have so far allocated identical budgets to cover the initial studies.

THE BENEFITS OF AN ITALIAN MEMBERSHIP

But the war in Ukraine could revive the options of a maxi alliance.

According to Cepa, “on an industrial level, Italy can offer technological capabilities to strengthen the next European tank. The possible entry of Oto Melara and Wass into the project, providing sensors and electronics, could bring Italian skills directly into the project, also giving a voice to Italy in the development phase. Both Italy and Europe would benefit in two ways ".

First of all, the analysts of the American study center underline, “Italy's entry into the project with the IOC (the consortium between Leonardo with Oto Melara and Iveco Defense Vehicles) would benefit from decades of experience in the development of land vehicles. Secondly, it further strengthens the European character of the project by adding Italy as another political and industrial contribution ”.

Furthermore, like all multinational projects, it would share the development costs, estimated at 1.8 billion dollars until 2028.

THE INTEGRATION OF THE SUBSIDIARIES OTO MELARA AND WASS DI LEONARDO WITH KNDS

Without forgetting that the Franco-German giant Knds made an offer for the subsidiaries of Leonardo, Oto Melara and Wass. ( Here the in-depth analysis by Startmag on Oto Melara, Wass and more. All the possible synergies between Italy and Germany).

For Il Sole 24 Ore , "an integration of Oto Melara and Wass with Knds would go precisely in the direction of creating that large integrated European group mentioned above, a leader in weapons systems and with a strong industrial, technological and corporate presence in the three major markets (Italian, French and German). A pole that would, among other things, have the ability to meet the requirements for the construction of the new land vehicles of the Italian army and, at the same time, to lead the program of the new European tank ”.

And Leonardo is registering increases on the stock market with consequent enhancement of Oto Melara and Wass. Therefore, the group headed by Alessandro Profumo could be a partner of the group without having to sell its subsidiaries, but simply a share. We recall that Fincantieri also made an offer for Leonardo's subsidiaries according to press sources.

ENTRANCE ALSO FOR IVECO DEFENSE

Finally, "Italy, by maintaining plants, technologies, specialized personnel and the intellectual property of its products, would gain a role in the program for the European wagon and could carve out, at the same time, a specific industrial mission, with design and development responsibilities for new products, in the field of land combat vehicles and in their marketing ”underlines the Confindustria newspaper.

Thus, for Italy, through Leonardo, participation in the MGCS program with a share of 15% is outlined. And thus a European defense pole would come to life.

“The European hub could also become the center of attraction for other realities such as, for example, Iveco Defense” concludes Il Sole 24 Ore .

This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/leonardo-oto-melara-verso-il-programma-del-carro-armato-europeo-mgcs/ on Thu, 03 Mar 2022 07:28:31 +0000.