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Arms group Rheinmetall and satellite producer OHB are in talks to launch a joint bid to build an equivalent to Elon Musk’s Starlink internet service for the German armed forces.
Talks over the partnership, which would give the groups a slice of Berlin’s €35bn budget for military space technology, are in the early stages, according to three people familiar with the matter.
The proposed joint venture would bid for a multibillion-euro contract to create a secure, military-grade satellite communications network in low Earth orbit (LEO) for the Bundeswehr, the German armed forces. Officials have likened the network to a military “Starlink for the Bundeswehr”.
The discussions between Düsseldorf-based tank maker Rheinmetall and Bremen-headquartered OHB, come as European defence and space companies jostle for lucrative contracts after Berlin last year promised to pour €35bn into military space technology. The EU’s largest nation is seeking to rapidly expand its military capabilities and reduce reliance on the US.
Starlink, owned by Musk’s SpaceX group, is the world’s biggest space-based broadband provider, with more than 9,000 satellites delivering connectivity to millions of customers from LEO — a region roughly 2,000kms above the Earth.
Initially a commercial service, Starlink’s high speeds and easily transportable terminals became critical to Ukrainian defence forces after Russia’s full-blown invasion. It offered highly resilient battlefield communications when other networks were destroyed or degraded.
Starlink has since launched an LEO satellite service for defence and intelligence customers known as Starshield. But many countries, nervous of relying on Musk or the US, want to develop their own secure and sovereign networks.
Germany’s plans to pour money into the sector will make it the third-biggest spender worldwide on space technology after the US and China, according to the space consultancy Novaspace.
Armin Fleischmann, a space co-ordinator for a division of the German military, told business daily Handelsblatt last week that the Bundeswehr network would be built “over the next few years, primarily with German companies”.
He said the priority would be to focus on Nato’s eastern flank, where Germany is building up a 5,000-strong permanent brigade in Lithuania, and that “everything else will follow”.
The military had finished drawing up the specifications and procurement authorities were working on issuing a tender, he added.
Rheinmetall has traditionally made tanks, artillery and ammunition but has been expanding rapidly into other domains as Germany has boosted its defence budget.
It won its first space contract — worth up to €2bn — at the end of last year, which will see it partner with Finnish space tech company Iceye to build satellites at a former car factory in Germany.
The companies will produce a constellation for radar reconnaissance — a technology well suited to surveillance through cloud cover, adverse weather or at night.
The proposed venture with Rheinmetall comes as OHB, which has supplied satellites for the EU’s Galileo navigation constellation, faces a competitive challenge from a potential merger of the space divisions of Airbus, Thales and Leonardo.
OHB chief executive Marco Fuchs has warned that the combination, which would bring Europe’s two biggest satellite manufacturers into a single entity, could be anti-competitive.
As Europe’s third biggest satellite manufacturer, OHB could struggle to compete on its own, but Germany’s desire for a new network could present an opportunity to expand its range of small- to medium-sized satellites.
The company, which has supplied radar reconnaissance satellites to the German armed forces, is seeking to expand its military business. Last week it lifted earnings and turnover forecasts for this year and next, in part thanks to expectations of a boom in military space spending.
OHB and the defence ministry and defence procurement agency declined to comment. Rheinmetall did not respond to a request for comment.
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