He is the man arguably at the centre of Germany’s rearmament in the wake of Russia’s invasion of Ukraine, and at the heart of that country’s military industrial complex.
As chief executive of German arms giant Rheinmetall, Armin Papperger has gone from leading a relatively unknown business outside Germany to now being at the head of one of the most high-profile companies in Europe.
Under the 62-year-old’s watch, Rheinmetall’s shares have jumped from just over €90 three weeks before Russia launched its full scale invasion of Ukraine to more than €1,500 today, as that war triggered a panicked investment in defence across Europe.
In Germany this historic shift has earned its own name – the Zeitenwende – and Rheinmetall is the chief profiteer of Berlin’s effective blank cheque approach to defence spending. Whatever Rheinmetall can make, Berlin will buy.
RM Block
In the last three years the listed Düsseldorf-based firm has agreed so many new contracts, plants and partnerships – from Finland to Bulgaria – that it expects its turnover to grown tenfold in the coming decade to around €120 billion.
Rheinmetall is profiting not from war, Papperger argues, but a realisation around Europe that many overdid it with the post-Cold War peace dividend and invested “almost nothing” in defence and security.
“What we want is peace on earth,” said Papperger in conversation with the Berlin foreign press. “But we need a certain level of security and deterrence potential so that no one attacks us. One aggressor or the other views this lack of investment as a weak spot.”
In recent decades Rheinmetall – with a century-old history that includes arming Germany in two world wars – operated discreetly away from the spotlight.
But Russia’s invasion of Ukraine in 2022 changed the lighting drastically. Even traditionally pacifist-leftist parties here accept that, with a war going on a train-ride away from Berlin, pacifism in 2025 requires investment in security, too.
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So is defence – not attack – once again the best form of defence?
“What we all want is that we aren’t attacked but the terrible thing is we have a situation where many in politics and in intelligence services say that in all likelihood there will be attempts to play with fire on the Nato outer border,” said Papperger. “We want to be an essential part of making Nato ready to defend itself.”
He is referring to Nato risk assessments that, after its war with Ukraine, Russia may turn its attentions to smaller Nato members in the Baltics.
German foreign minister Johann Wadephul went public with those concerns this week, saying “at the very least, Russia is creating the option for itself to wage war against Nato by 2029”.
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Not everyone in Germany is happy that one future option is being hyped up as the most likely scenario. Over 100 MPs from the centre-left Social Democrats (SPD), junior coalition partners in Berlin, have signed a manifesto demanding as much effort and investment in diplomacy as cash for arms.
Pushing the worst-case-scenario means even more business for Rheinmetall, of course, but Papperger insists his firm is only a recipient – not author – of such Nato risk assessments.
It is up to states to place orders they feel appropriate but, given the recent rush, he thinks capitals should “think more strategically rather than in day-to-day, operative, do-gooder terms”.
“Sadly many people are dying in Ukraine because of this negligent thinking,” he said.
Rheinmetall’s biggest divisions are weapons, ammunition, vehicles and artillery and Papperger disputes the argument that Ukraine shows the need to invest less in conventional arms and more in drones.
Their rise, Papperger argues, merely reflects the static nature of the Russian-Ukraine conflict. Even now, he said, 95 per cent of drones there are shot down with conventional equipment such as its Skyranger. The real race, he thinks, is to make such equipment cheaper to make drones uneconomical.
In either case, a potential Russian attack on a Nato state would look very different from the Ukrainian invasion, says Rheinmetall’s salesman-in-chief.
Any full-scale invasion would require traditional armoured systems to push back any invader, backed with lots of artillery “because that’s cheaper than anything else”.
All this profit has come at a personal cost for Papperger. A reported Russian assassination plot means he and his family now live with permanent police protection, at state expense.
Looking to the future, Papperger sees greater potential for closer European defence co-operation – once, that is, the deals are lead by Rheinmetall. He brushes off criticism of dominance from, in particular from France, as sour grapes from cumbersome state-run firms faced with more agile privately-held operations like his.
“Rheinmetall reacts like a start-up and grows like a start-up,” he said, “and has profitability of a blue-chip.”
So far Papperger has steered Rheinmetall’s share price from €40 to around €1,600 now. Ever the salesman, he suggests a recent dip means firm is now, if anything, undervalued.
“I am a major investor in this firm,” he said, “and I am very relaxed.”
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