Hanwha Aerospace Co., South Korea’s leading defense manufacturer, is set to build a precision missile production facility in Germany, marking a key step in its strategy to expand across the fast-growing European defense market.

The move reflects the company’s broader ambition to establish a strong industrial presence in Europe, driven by the region’s historic levels of defense spending and its strategic shift toward localizing arms production.

At a recent investor and stakeholder briefing in Berlin, Hanwha’s European subsidiary announced plans to scout multiple sites in eastern Germany for its first manufacturing plant in the country. Sources familiar with the matter said this marks the first time the company has publicly confirmed plans for a German production base.

Over 100 representatives from German government agencies and defense industry partners attended the event.

Historically, Hanwha relied on German technology to power its flagship K9 self-propelled howitzer. That dependency was reduced in 2023 after the company began using domestically produced engines from South Korea’s STX Engine Co., enabling smoother exports, especially to the Middle East.

The planned German plant will serve as a production hub for advanced weapons systems, including guided missiles and ammunition. Hanwha Aerospace has already partnered with more than 60 German suppliers and plans to pursue joint R&D initiatives, develop integrated supply chains, and invest in local talent.

“We are committed to building cutting-edge defense capabilities in close cooperation with our German partners,” said Bae Jin-kyu, head of Hanwha Aerospace’s European operations.

Germany is a centerpiece in Hanwha’s broader European strategy, which also includes projects in Poland and Romania. In Poland, Hanwha has formed a joint venture with WB Group to manufacture Chunmoo rocket launchers and guided missiles. In Romania, the company has selected a site for a new plant to produce K9 howitzers and K10 ammunition resupply vehicles, with construction expected to begin this year and operations starting by 2027.

In July 2024, Hanwha signed a 1.4 trillion won ($1 billion) deal with Romania to supply 54 K9 howitzers and 36 K10 ARVs. These systems are powered by engines from MTU Aero Engines and transmissions from Renk Group AG—both German companies.

Previously, Hanwha’s reliance on German technology hindered its global ambitions. In 2020, the company had to withdraw from a major K9 export deal with the United Arab Emirates after Berlin blocked arms sales to the Middle East.

Now, Hanwha’s German expansion aligns closely with the European Union’s push for defense self-sufficiency. In May, the European Commission announced a €800 billion ($903 billion) defense industry strategy through 2030, prioritizing European-made military systems.

To support its global growth, Hanwha Aerospace plans to finance its overseas ventures through a 2.3 trillion won rights offering announced in April. About 1.6 trillion won will be allocated to international defense projects, the company said.