On 13 August 2024, the Düsseldorf-based Rheinmetall Group signed an agreement to acquire all equity interests in Loc Performance Products, LLC, a vehicle specialist based in Plymouth, Michigan.
This acquisition will expand Rheinmetall’s business with the US military, increase its industrial base in the USA, and provide further access to North American markets. Additionally, Rheinmetall aims to strengthen its production capacities in the USA, targeting high-volume orders for U.S. Army vehicle programmes with a potential value exceeding USD 60 billion.
Rheinmetall is one of two remaining participants in the prototype phase of the XM30 programme, which aims to introduce a new generation of infantry fighting vehicles. This programme is estimated to be worth around USD 45 billion for approximately 4,000 vehicles. Rheinmetall is also involved in the CTT (Common Tactical Truck) programme, valued at around USD 16 billion for approximately 40,000 trucks.
The acquisition of Loc Performance is expected to benefit both Rheinmetall’s American and global operations. The integration of Loc Performance’s experienced workforce, known for their expertise in the maintenance, repair, and enhancement of military combat vehicles, will strengthen Rheinmetall’s internal supply chains.
The agreed purchase price for Loc Performance, based on an enterprise value of USD 950 million, will be due upon closing, subject to regulatory approvals.
Armin Papperger, CEO of Rheinmetall AG: “We are making this investment because we have a clear strategy for growth and the United States will be an important core market for us in the coming years. The acquisition of Loc Performance proves that we are consistently focussing on success in the USA and want to expand our share of the large market volume. Everything speaks in favour of this acquisition: Loc Performance is already pursuing a sustainable business model there with robust organic growth, has a highly qualified workforce and offers us significant capacity reserves for the orders we are targeting in the USA.”
Matthew Warnick, CEO of American Rheinmetall Vehicles: “In the USA, we have a promising position in two major military projects, both in the XM30 infantry fighting vehicle program and in the CTT project. The acquisition of Loc Performance gives us the manufacturing readiness that will enable us to realise the major orders we are aiming for. This puts us in a position to realise 100% local value creation in the USA.”
Jason Atkinson, CEO of Loc Performance: “The significant engineering capabilities of American Rheinmetall Vehicles and the next-generation technologies that are part of the exceptional global Rheinmetall Group are a great fit with Loc Performance’s 53 years of manufacturing experience in the United States. I am excited about this combination, which represents a powerful end-to-end solution that will bring even better products to our customers and even more growth to our combined company.”
The company will contribute directly to Rheinmetall’s fast-growing US military vehicle business, managed by American Rheinmetall Vehicles based in Sterling Heights, Michigan.
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