Rheinmetall Agrees Takeover Of US Vehicle Specialist

German defence giant Rheinmetall has announced plans to acquire American firm Loc Performance Products as it seeks to bolster its position in the world's largest defence market.

The Düsseldorf-based multinational provider of land vehicles for military customers worldwide has made the move with an eye to expanding its North American production base.

The purchase price agreed by Rheinmetall for Loc Performance Products is based on an enterprise value of $950 million. The U.S. firm employs in the region of 1,000 employees and is based in Plymouth, Michigan, with manufacturing bases in Michigan and Ohio.

Alongside General Dynamics Land Systems, the German firm is one of two companies shortlisted for the XM30 programme to supply the U.S. Army's new Mechanized Infantry Combat Vehicle (MICV).

The XM30 is now at the prototype phase and will replace platforms such as the M2 Bradley. The total anticipated volume for the new generation of infantry fighting vehicles is estimated at around 4,000 vehicles, with an anticipated order value of roughly $45 billion.

Rheinmetall's American arm is also part of a team participating in U.S. Army's CTT (Common Tactical Truck) programme, eventually expected to generate orders for about 40,000 trucks at a cost of roughly $16 billion.

Its vehicle, the HX3, was developed with GM Defense and in January 2023 it won a contract for the first phase of the CTT programme, alongside rivals Mack Defense, Navistar Defense and Oshkosh Defense.

Evaluation of the initial delivered prototypes is ongoing, with a decision expected in the 2026 fiscal year.

Matthew Warnick, CEO of American Rheinmetall Vehicles, commented: "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."

Jason Atkinson, CEO of Loc Performance, said he was excited about the planned acquisition and described Rheinmetall's expertise as "a great fit with Loc Performance's 53 years of manufacturing experience."

Read more on the story on Rheinmetall's website