Ammunition Production Capacity Increasing Várpalota Ammo Plant Continues to Grow

Date: Issue 128 - March 2024

The new Rheinmetall ammunition plant in Várpalota, Hungary, currently being built by the Hungarian holding company N7 on behalf of the joint venture company Rheinmetall Hungary Munitions Zrt., is now poised to expand as planned. The second phase of construction started in January 2024. The concept for a multi-phase expansion of the plant existed prior to February 2022 and the Russian invasion of Ukraine. The project constitutes a strategic Hungarian investment in cooperation with Rheinmetall in response to the shortfall in ammunition already apparent at the time, given the anticipated increase in demand in Europe and NATO. Furthermore, it has the added aim of reducing Europe’s dependence on overseas imports.

Now set to begin, the “Várpalota 2.0” expansion will increase the size of the plant by 20 hectares to approximately 120 hectares. The number of employees will grow to up to a total of 200. In addition, the product range will expand to include new types of ammunition, principally 155mm artillery shells for the PzH 2000 self-propelled howitzer and 120mm ammunition for the Leopard 2 main battle tank and its potential follower, the Panther KF51 EVO. Production is slated to begin in early 2026. Furthermore, Rheinmetall also plans to carry out development and acceptance testing at Várpalota.