Overview
- Germany’s Defence Minister Boris Pistorius notified industry and lawmakers on Wednesday that Berlin will abandon the six-ship F126 program and instead buy eight smaller Meko A‑200 frigates.
- The decision sent Rheinmetall shares down more than 15% and lifted TKMS by over 10% because TKMS already holds contracts to build Meko A‑200 ships.
- Officials expect roughly €2 billion of F126-related costs to be written off, reversing Rheinmetall’s earlier industrial bet after its €1.5 billion purchase of Naval Yards Lürssen this year.
- A first F126 hull has begun at the Wolgast shipyard and its fate is unclear, with sources saying it could be scrapped while legal and damage claims against Damen Naval are being reviewed.
- The move highlights persistent procurement problems — cost overruns, software delays and documentation disputes — and raises questions about how Germany will deliver on its wider, multi-year military overhaul.