Apartment buildings in flames and clouds of smoke over the Ukrainian capital, Kyiv: Almost every day, Russia attacks the country with drones and rockets. In response, Ukraine is defending itself, including by striking targets deeper inside Russia. It’s quite possible that in these long-distance attacks, drones produced with German funds are being used.
“This is the beginning of a new form of military-industrial cooperation between our countries, one that has great potential,” German Chancellor Friedrich Merz said in late May when Ukrainian President Volodymyr Zelenskyy visited Berlin.
The two countries’ defense ministries signed an agreement back then: Germany would finance long-range weapons but they are to be produced in Ukraine. Two months later, not many details about the arrangement have become public. “The process is ongoing,” Mitko Müller, a senior spokesperson for Germany’s Ministry of Defense, told DW in late July.
In June 2024, Denmark became the first NATO member state to get involved in the Ukrainian arms industry.
German arms manufacturers are represented in Ukraine, with Rheinmetall, an arms manufacturer headquartered in Düsseldorf, likely the most visible. The industrial giant is expanding its presence there and is engaged in a number of joint ventures. For example, tanks are being manufactured and repaired there and an ammunition factory being built.
‘Huge change’ in German attitudes
“We are seeing a huge change in Germany’s approach toward Ukraine, a complete opening up,” Ihor Fedirko, the chief executive of the Ukrainian Council of Defense Industry (UCDI= told DW.
Direct investments by the German government into Ukrainian drone and missile production are still a relative novelty. According to Die Welt, a German newspaper, Germany intends to fund around 500 An-196 Liutyi drones, one-way attack, unmanned aerial vehicles. Ukrainian media reports suggest that each drone costs around $200,000 (€175,000).
The drone was developed as a result of previous cooperation between Turkey and Ukraine. The An-196 Liutyi “was already quite advanced in its development and testing,” military expert Gustav Gressel, formerly a senior policy fellow with the European Council on Foreign Relations, explained. A very high proportion of these drones are shot down though, Gressel continued, because they fly fairly slowly, at similar speeds to comparable Russian models.
Apart from funds, Ukraine is also hoping for German know-how. “We lack deep-tech technologies,” Fedirko explains, referring to cutting-edge engineering. “This affects the component base. Equipped with this kind of knowledge, we could modernize more thoroughly and become more efficient,” he said. Germany has these technologies.
Currently Ukraine is asking all of its allies for technology that would enable long-range weapons, Fedirko continued.
“We’re talking about a range of between 500 and 1,000 kilometers,” he explains. “Some of them [the weapons] — for example, the deep-strike Liutyi, can already get to targets more than 2,000 kilometers away.”
Producing German drones in Ukraine
Many German defense companies getting more active in Ukraine are startups, mostly based in Bavaria. One example is Quantum Systems, a firm specializing in aerial data and making unmanned aerial systems to collect it.
Fedirko describes this as a “best-case scenario” of the kind of cooperation Ukraine wants.
Founded in 2015, Quantum Systems has been supplying its Vector reconnaissance drones to the Ukrainian army since 2022. A special feature of the Vector is its ability to take off and land vertically.
“We are the only Western company producing reconnaissance drones where they are most urgently needed: on-site in Ukraine,” says Sven Kruck, co-chief executive at Quantum Systems. His company employs around 200 people in Ukraine, and it’s growing; a second production plant is scheduled to open in September.
In mid-July, Quantum Systems announced that it would also acquire a 10% stake in Frontline, a Ukrainian drone manufacturer. It will have the option to increase that stake to 25% over the next year.
“Frontline specializes in technical solutions for reconnaissance and strike operations. Its systems are currently used by 41 military units in Ukraine,” Kruck explained. “We see potential for cooperation, especially in the development of drone defense.” However, he added, his company doesn’t plan to get into combat drones.
Combat drones are being made by another German company, Helsing. The Bavarian firm has already delivered thousands of drones to Ukraine and, last February, announced a new contract for over 6,000 HX-2 strike drones. According to online publication Defense industry Europe, the HX-2 is “an electrically propelled X-wing precision munition with a range of up to 100 kilometers.”
Its use of advanced computing also makes it more resistant to electronic warfare. Helsing did not respond to DW’s enquiries asking for further details.
However, as much as the Ukrainians might be pleased about German funding and investments into drones, demand still far outstrips supply.
Ukraine a testing ground for weapons
Gressel argues that Ukraine needs bulk supplies of good quality. These can only be produced cost-effectively inside Ukraine itself.
The same argument applies to missiles, such as the Taurus cruise missiles, a weapon the Germans are currently unwilling to supply. However, Gressel suggests that cooperation with German companies might enable some parts to be supplied. That could increase the range of Ukraine’s own Neptune cruise missiles, with more energy-efficient engines that could fly further on the same amount of fuel and more accurate sensors, which would help land-based targeting. However, a decision on supplies like that has yet to be made.
Germany is not only more willing to invest in Ukraine but also to share knowledge. At the start of the war, there were fears that modern German technology could fall into Russian hands and doubt about the reliability of the Ukrainian military personnel, Gressel explains. That’s one of the reasons why Ukraine initially received older weaponry.
But that’s changed. This is partly due to the fact that Ukraine now produces modern weapons itself and can compete with other manufacturers.
“German companies are learning things here that you never get to simulate in peacetime,” Gressel notes. For example, Ukraine’s combat zone is absolutely packed with jammers, jamming devices and air defense systems, the sort of thing you’d never get anywhere else, not on a NATO training ground, in simulations in Germany, nor in the US.
The defense industry recognizes this, Gressel says.
Quantum Systems’ Kruck can confirm that. “Drone development is a game of cat and mouse,” he told DW. “Only those who are on site can adapt to all the constant changes. Our insights from Ukraine flow directly into our product development, which we make available to all our customers worldwide.”
He sees his company’s work in Ukraine as a “flagship project” and wants to encourage others to emulate it.
The UCDI’s Fedirko would like to see this kind of cooperation go even further. “Germany is a country with typical European bureaucracy,” he admits. “So it takes time to get things done. But when the Germans say they’re doing something, we Ukrainians know it will get done.”
This story was originally published in German.
