The German defense company wants to have a greater presence in the USA. Rheinmetall has now taken over an American supplier for a large sum.

The Düsseldorf-based arms company Rheinmetall wants to do more business with the American military by taking over the US supplier Loc Performance. Rheinmetall is spending 950 million dollars (870 million euros) on the company from Plymouth in the state of Michigan, the DAX-listed company announced on Tuesday evening. “By taking over Loc Performance, the company is expanding its business with the US military, increasing its industrial base in the USA and creating further access for its technologies in North America,” the statement said.

Rheinmetall hopes that this will open up more opportunities for orders in the world's largest defense market. With Loc and its approximately 1,000 employees, it will be able to expand both its product range for military vehicles and its local production capacity – which is important to the US government. Loc operates four plants in the states of Michigan and Ohio and, according to its own information, manufactures drive trains, suspensions, track systems, rubber and armor products, and structures for vehicle platforms. In addition to the military, Loc's customers also include the construction and agricultural industries.

The takeover is expected to give Rheinmetall an advantage in the battle for two major contracts in the USA: the company is one of two participants in the prototype phase of the XM30 program to build a new generation of infantry fighting vehicles. The project involves 4,000 infantry fighting vehicles for 45 billion dollars. Rheinmetall is also hoping to win the contract for the approximately 16 billion dollar “Common Tactical Truck (CTT)” program for 40,000 military trucks.

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