The Rheinmetall arms manufacturer opened a new factory at its existing site in Unterlüss in northern Germany on Wednesday, boasting that once it reaches capacity it could become Europe's biggest munitions production factility.

CEO Armin Papperger said that the production of 155 mm caliber artillery shells would be progressively ramped up, to reach 350,000 units per year by 2027. These artillery shells are in particular demand and short supply in Ukraine, and Europe and NATO members have been scrambling to replenish their stockpiles and increase production capacity.

"So I think next year we would be able to give a minimum of 100,000 [155 mm shells] to Ukraine, and then the next year maybe 200,000 to Ukraine. The rest is for other partners," Papperger told DW on Wednesday.

Rheinmetall plans to increase unit production at several facilities as well as the new one in Unterlüss, near Hanover.

NATO's Rutte, German ministers attend ceremony

NATO Secretary General Mark Rutte, German Defense Minister Boris Pistorius and Finance Minister Lars Klingbeil toured the facility with Papperger and other officials on Wednesday. 

Pistorius acknowledged that no factory could meet Ukraine's requirements single-handed, but lauded the speed of construction of the new facility and the increased capacity per employee thanks to automation. He said this change of approach would help "supply Ukraine and replenish the stocks of NATO partners."  

"The crucial thing is that we were able to open such a plant in a very short time," Pistorius told DW. "In the past, something like this would have taken two to four years. But here it was achieved in 14 months. That's what matters: sending the signal that we can do it faster, we want to do it faster, and production is ramping up." 

According to Rheinmetall, the company invested roughly €500 million (roughly $580 million) in this new facility and another that will focus on rocket motors.

The company's site in Unterlüss already includes other smaller areas for artillery production and for the production of Puma tanks, as well as a large firing range. 

"With this we're opening a new chapter both in our company's history and that of our site at Unterlüss with regard to artillery production," Papperger said.

Earlier this month, the company reported rising turnover and profits, as well as record order figures — turning orders into deliveries and revenues can take some time in this sector — for the year to date.

Last July, Papperger was even alleged to be the target of a foiled Russian assassination plot, in a sign of the company's importance to Kyiv's military.

Rheinmetall stock up roughly 2,000% since Russia invaded Ukraine

Investors have been flocking to Rheinmetall stock in recent years, and particularly since Donald Trump's election to a second term as US president.

Stagnant at or below €100 for decades, it doubled in just a few months after Russia's February 2022 invasion of Ukraine. 

It continued to climb steadily as the previous German government pledged a new era in matters of defense spending and as the conflict in eastern Europe dragged on, reaching around €500 in time for last year's US presidential eletions.

Then in the first half of this year it went into overdrive, peaking at almost €1,900 in late May. 

Investors seeking the next fashionable stock to inflate have evidently decided that even if Germany and other European NATO members have no idea how they will spend 5% of GDP on defense, or when, pouring taxpayer money into the coffers of companies like Rhinemetall will play a part.