€10 billion for communications: how Germany plans to reduce its dependence on SpaceX
26 January 20:23
German defense contractor Rheinmetall and aerospace company OHB are in talks to jointly develop a satellite system for the German armed forces. The project is in its early stages, but its potential cost could reach around €10 billion, according to Spiegel, as reported by "Komersant Ukrainian".
The project involves the development of a military communications system, which the media compares to SpaceX’s Starlink network.
What the companies are planning
According to German media reports, Rheinmetall and OHB are considering a joint bid for a large-scale government contract. The system is intended to provide secure satellite communications for the Bundeswehr and reduce Germany and Europe’s dependence on American commercial operators.
Neither company has officially commented on the details, but they confirm that negotiations are ongoing.
Why this is important for Germany
Last fall, German Defense Minister Boris Pistorius announced plans to invest €35 billion in military space applications. The priority is to create Germany’s own satellite infrastructure and expand access to space for defense purposes.
Europe currently relies heavily on Elon Musk’s SpaceX for both rocket launches and satellite communications.
What role does Rheinmetall play?
Düsseldorf-based Rheinmetall positions satellite technology as a market of the future. The company expects that digitalization, which includes satellite solutions, will generate €8-10 billion in revenue in the long term.
Rheinmetall has already begun to expand its presence in this area:
- it is cooperating with Finnish satellite manufacturer Iceye;
- at the end of 2025, it received its first satellite order from the Bundeswehr for approximately €1.7 billion.
Who is OHB and why is it important?
The family-owned company OHB from Bremen is the third-largest satellite manufacturer in Europe. It also owns the start-up Rocket Factory Augsburg, which is working on the development of a small launch vehicle for putting cargo into orbit.
OHB CEO Marco Fuchs has previously expressed public concern that large European alliances could squeeze smaller players out of the market. The partnership with Rheinmetall could be a way for the company to maintain its position.
European competition
Rheinmetall and OHB’s plans intersect with another major initiative: last fall, Airbus announced the merger of its space business with France’s Thales and Italy’s Leonardo. The goal is to create a powerful European space technology center.
Thus, competition is forming in Europe between two large defense and space blocs.
