Germany plans to reduce spending on ammunition procurement in 2027, directing additional funds to other areas of defense. This could create new challenges for one of the country’s largest arms manufacturers — Rheinmetall AG.

According to the draft budget for 2027 reviewed by Bloomberg, spending on ammunition could amount to about €9.6 billion versus €11 billion in 2026. At the same time, the document may still be amended by the government.

Germany’s overall defense funding is expected to increase significantly through 2030. However, the reallocation of funds could affect demand for artillery shells and other types of ammunition, the production of which has become one of Rheinmetall’s key growth areas amid the war in Ukraine.