Rheinmetall shares fell after the possible cancellation of the construction of the F126 frigates

The share price of the German defense concern Rheinmetall collapsed on the stock exchange after the German government decided to postpone a multibillion-dollar order for the construction of six frigates for the navy. This was reported on June 24 by Bloomberg, citing sources and analysts at Morgan Stanley investment bank.

"This is clearly negative news, and the possible cancellation of the contract came as a surprise, especially considering that Rheinmetall was confident of concluding it before the summer holidays," they noted.

According to undisclosed agency interlocutors, Rheinmetall shares have now collapsed by 17%, which was the sharpest drop in the last year. For this organization, the decision of the German authorities will result in a forced write-off of about € 2 billion (approximately $ 2.3 billion). It also threatens not only the manufacturer's current income, but also his long-term plans in the shipbuilding sector.

The affected party is actively creating joint ventures with corporations and start-ups engaged in the production of modern and especially relevant types of equipment. So, in December 2025, the German concern entered into an agreement with the satellite manufacturer ICEYE to establish a joint venture to produce space satellites for the needs of the Armed Forces of Germany.

In addition, in April Rheinmetall and the Dutch company Destinus signed an agreement on the joint production of modern missile systems. In May, the defense group agreed with the local telecom operator Deutsche Telekom to cooperate on the creation of a system of protection against drones and sabotage to protect the critical infrastructure of Germany.

Now one of his largest orders may go to ThyssenKrupp Marine Systems (TKMS), whose shares have jumped at least 12%.

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On the same day, Spiegel magazine learned about the plans of German Defense Minister Boris Pistorius to abandon the project adopted by former Chancellor Angela Merkel to build the latest F126 frigates (Niedersachsen class, Lower Saxony). It was noted that approximately €12.7 billion more will be spent on the acquisition of ships of another class. This step is supported by the leadership of the German Navy.