In a significant development in the defense sector, Italian vehicle manufacturer Iveco has secured a role in the expansive contract involving Leonardo and Rheinmetall to construct advanced fighting vehicles and tanks for the Italian army. The company announced that its defense division, Iveco Defence Vehicles (IDV), will undertake between 12% and 15% of the development and production activities associated with this substantial contract, valued at approximately €23 billion ($24 billion).
Iveco emphasized its intent to contribute its expertise in advanced propulsion and drivetrain systems, combined with specialized protection technologies, to the project. The agreement came shortly after Leonardo and Rheinmetall revealed their plans to establish a 50-50 joint venture aimed at producing 1,050 new infantry fighting vehicles for the Italian military. These vehicles will be based on Rheinmetall’s Lynx design, with the first expected delivery slated for two years from now.
In addition to the infantry fighting vehicles, the venture includes the development of a new main battle tank derived from Rheinmetall’s Panther KF51 model, intended to replace Italy’s current Ariete tanks. The contract includes a deliverable of 132 units, with the initial tank anticipated to be ready within the next two and a half to three years.
Leonardo’s role in the joint project will include responsibility for mission systems, electronic configurations, and weaponry for the vehicles. The establishment of the Leonardo-Rheinmetall alliance follows failed negotiations for a partnership with the Franco-German manufacturer KNDS to construct Leopard tanks for Italy, which fell through due to design disagreements and scheduling conflicts.
The inclusion of Iveco in this significant defense initiative comes in the wake of previous concerns that the firm might be sidelined, despite its historical collaboration with Leonardo through a joint venture known as CIO. Prior to the recent alliance with Rheinmetall, CIO had been solicited by the Italian army to devise proposals for a new fighting vehicle; however, this effort was rendered obsolete once the Rheinmetall Lynx was selected as the project’s foundation.
In addition to the new contract, there have been rumors regarding Leonardo’s interest in acquiring IDV, although the recent agreement to appoint it as a supplier in the joint venture may impact those discussions. This collaboration represents a vital step in enhancing Italy’s defense capabilities while fostering industrial cooperation between leading European defense contractors.
