Italian Army

What is the Main battle tank, the Italian army's new tank and who could build it

The tank emerged as an important strategic weapon with the war in Ukraine, after the relevance of land armaments had already been rediscovered in the war in Iraq (2003-2011).

by Gianni Dragoni

4' min read

4' min read

There is a battle over the 'main battle tank', the heavy tank for the Italian Army that is to replace the old Ariete, which entered service almost 30 years ago. The tank established itself as an important strategic weapon with the war in Ukraine, after the relevance of land armaments had already been rediscovered in the war in Iraq (2003-2011). As a result, many armed forces have put in place programmes to rejuvenate their fleets of war crawlers that date back several decades.

8 billion needed

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Even Italy, which for many years allocated a large part of the defence budget mainly to arms purchases for the air force and navy, skimping on resources for the army, has budgeted a first part of the sum needed to buy new tanks. The estimated financial requirement to buy almost 400 heavy tanks, including armoured fighting vehicles and special vehicles, is eight billion euro over a period of several years, but only half of the sum has already been financed. The new Italian tank is expected to enter service in 2035, 40 years after the Ariete.

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The role of Oto Melara

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Domestic industry does not have the capabilities to build the army's future Mbt. Oto Melara, the La Spezia-based company of the former Finmeccanica (now Leonardo) that produces land armaments, built the Ariete, while today its specialisation is turrets. Hence the need for Leonardo to seek a foreign partner to jointly produce the vehicles to be offered in the tender to be launched by the Army.

The negotiations with Knds

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For some time now, two large European groups have been interested in the Italian maxi-order. One is Knds, the Amsterdam-based holding company that controls the French company Nexter, manufacturer of the Leclerc tanks used by the French Armée, and the German company Krauss-Maffei Wegmann (Kmw), manufacturer of the Leopard, the 'bestseller' tank, the most popular in Europe, sold to 18 countries.

The Profumo management

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Under Leonardo's previous management, when the managing director was Alessandro Profumo until 13 months ago, the group was willing to sell a share in Oto Melara (at least 49%) to Knds. This would have been the first step towards the participation, in pole position, in the multi-billion dollar order for the army.

Contracts with Fincantieri

The Oto-Knds deal had been opposed by, among others, Fincantieri when it was led by Giuseppe Bono, who aspired to take over Oto Melara from Leonardo in order to directly make the Italian Mbt, seeking a partner that could have been another German group, Rheinmetall. But Fincantieri did not have the money to buy Oto Melara, and the differences between Bono (whose mandate ended two years ago) and Profumo added further complications to this option. Today, with new CEO Pierroberto Folgiero, Fincantieri no longer has any interest in Oto Melara, while it has signed an agreement with Leonardo to buy Wass's underwater systems, for a price of up to €415 million.

Breaking with Knds

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Leonardo's new management, led by CEO Roberto Cingolani and co-general manager Lorenzo Mariani, in office from 9 May 2023, has changed its approach. Leonardo no longer wants to sell shares in Oto Melara, but is looking for an industrial partner with which to participate in the construction of the new heavy tank for the Army and enter the game of the future European Mbt, a larger project promoted by France and Germany. For this, a preliminary agreement had been signed on 13 December 2023, a prelude to an alliance that was to be finalised by the end of this year.

Negotiation on Italian Leopard failed

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The basis for the future Italian Mbt was identified in the Leopard 2A8. But negotiations were unsuccessful. The Germans at Kmw did not want to give Oto Melara the space requested by the Italian group. Leonardo was basically asking for the 'Italianisation' of the tank, in order to divide the total order value of 8 billion into two parts, 50% each. Given Oto Melara's specialisation, the Italian group would have wanted to produce the turret, parts of the electronics and the targeting systems. But the work on the Leopard is already assigned to numerous companies in Germany and other European countries, because this tank has been in production for years. The Leonardo group was only offered the production of minor components. Negotiations failed and the hypothesis of a Leonardo-Knds joint venture fell through.

Rheinmetall in the field

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When the break-up between Knds and Leonardo was officially announced on 11 June, the focus went to Rheinmetall, Europe's leading land armament group and largest munitions manufacturer. The Duesseldorf-based group has already had contacts with Leonardo, while it is developing its own tank, the Panther Kf51. The hypothesis is that Leonardo could obtain from Rheinmetall the production of the turret for the Italian Mbt and also for the European one, what it did not get from Knds.

The Bae Systems alternative

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Another hypothesis would be for Leonardo to open negotiations with the British company Bae Systems, which makes the Challenger. A possible way forward, but the main route now is through Rheinmetall.

A total of 20 billion

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Rheinmetall is also thinking about another vehicle, the light armoured vehicle for the Army (Ifv or Aics) that is to replace the old Dardo. The Germans already have a vehicle of this type on the market, the Lynx, exported to Hungary. Calculating this order as well, the total value between Mbt and Aics would come to 20 billion. Money largely to be found, but that is what is at stake.

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  • Gianni Dragoni

    Gianni DragoniCaporedattore, inviato

    Luogo: Roma

    Lingue parlate: italiano, inglese, francese

    Argomenti: economia, finanza, industria aerospazio, difesa, industria ferroviaria, trasporto aereo, grandi aziende pubbliche, privatizzazioni, bilanci società di calcio, stipendi manager, governance società quotate, conflitti d'interesse

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