Hungary finances the development of the KF51 tank Panther from Rheinmetall, but without buying it…

The German industrial group Rheinmetall has just announced the signing of an agreement with Hungary, to lead the KF51 tank Panther from demonstrator status to industrial production. However, the €288 million that will be spent by the Hungarian state industrial holding company N7 in this adventure will profoundly transform the German industrialist's program, as will its potential ambitions, particularly in Europe.

In terms of defense equipment contracts, the most classic case for countries with a defense industry is to turn to their own manufacturers to conclude a contract. When the equipment is not within its industrial or technological reach, it is then common for a country to turn to one of its partners or allies to acquire it, or possibly, to produce it on site, with certain technology transfers.

Sometimes, countries participate in a research and technological development program without intending to acquire the equipment, simply to advance their own skills (case of NEURON). In even rarer cases, a country may decide to turn to a foreign manufacturer to develop new equipment of its own and equip its armies.

What is very unusual, however, is that a country turns to a foreign industrialist to finance the development of equipment that it does not plan to acquire, or at least, without it made an announcement to this effect. However, this is precisely what Hungary and the German Rheinmetall have just done, regarding the new KF51 battle tank. Panther.

The journey of the KF51 tank Panther from Rheinmetall, from Eurosatory 2022 to today

Presented for the first time at the Eurosatory 2022 show, the Panther had the effect of a bomb. According to its designer, Rheinmetall, the tank presented then, was functional, and could even fulfill the function of a prototype, it was so accomplished. Facing it, the new EMBT presented by KNDS naturally looked pale, more like a model than a technological demonstrator at that time.

KNDS EMBT
Presented jointly with KF51 Panther during the Eurosatory 2022 exhibition, the KNDS EMBT seemed much less technologically and conceptually accomplished

The official presentation of the KF51 was accompanied by an intense media communication campaign and powerful political lobbying towards the Bundestag. Rheinmetall's goal, as its CEO Armin Papperger later admitted, was to derail the Franco-German MGCS program (which did not need that at that time), to seize the juicy market of replacing Leopard 2A4 and A5 in Europe and beyond.

Unfortunately for Rheinmetall, things did not develop precisely as they should have. First of all, the Bundeswehr announced that it would order Leopard X, and not Panther, to replace the Leopard 2A6 sent to Ukraine. The final blow has arrived in April 2023, when KNDS presented its new Leopard X, an evolution of Leopard 2A7HU sold to Hungary four years ago, and that it was immediately ordered by the Bundeswehr in place of the A7s initially planned.

From then on, everything was a succession of disappointment and disillusionment for Rheinmetall, while Norway, the Czech Republic et Italy followed in the footsteps of the Bundeswehr to acquire the A8, that the Polish and Romanian markets seem destined for the South Korean K2 and the American Abrams, and that even the EMBT seems to be regaining color, being officially proposed by France to Egypt.

Hungary will finance the technological maturation of Panther, without committing to order it

In fact, Rheinmetall found itself, until then, close to an impasse, unable to continue to develop its own funds. Panther, to make it a real battle tank, without the beginnings of an export order. This is particularly the case after the semi-failure of the KF-41 Lynx, which also claimed to be revolutionary when it was released a few years ago, but which has so far only been ordered by Budapest, after being beaten in several competitions by the Swedish CV90 and the South Korean AS21.

CV90 VCI
Slovakia and the Czech Republic preferred the Swedish CV90 Mk4 to the KF41 Panther from Rheinmetall.

Salvation for the Panther will come, it seems, once again from Hungary. Indeed, Rheinmetall has just announced the signing of a €288m contract with Budapest, to continue the technological maturation of the tank through a joint venture founded with the state industrial holding company N7.


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