Defense Giant KNDS Launches in Ukraine: Why It Matters

KNDS leadership officially announced the opening of its local branch in Ukraine on October 1. This is not the first such move since Russia’s full-scale invasion, as foreign defense companies have been establishing operations in Ukraine to get closer to their customers. However, given KNDS's scale, this event is significant.

What is KNDS?

KNDS is a joint venture between two major European weapons manufacturers: Germany’s Krauss-Maffei Wegmann and France’s Nexter Systems, specializing in armored vehicles. Talks began in 2014, with the merger finalized by early 2016, forming KNDS (KMW+Nexter Defense Systems).

The goal? Boost efficiency and maximize scale. Joining forces allowed for more effective use of resources and the advantages of operating in Germany and France.

Each company brought its own expertise, producing different types of weapons that complemented rather than competed with each other:

• Germany focused on tanks (Leopard 1, Leopard 2)

• France focused on artillery (CAESAR)

Today, KNDS ranks among the largest defense companies in the world.

Production in Ukraine

KNDS first announced its intention to open a subsidiary in Ukraine in the early summer of 2024. The business will focus on two main areas:

1. Maintenance of CAESAR self-propelled howitzers

2. Production of spare parts for the company's equipment

The facility, set to begin operations in Ukraine in October, will handle a much wider scope of tasks, with equipment maintenance being the top priority.

A variety of KNDS-manufactured equipment is actively used in Ukraine, including Leopard 1 and 2 tanks, CAESAR and PzH 2000 howitzers, and AMX 10RC armored vehicles. With the new facility, all of this equipment can now be repaired locally in Ukraine, handling everything from minor fixes to major overhauls, even in cases of severe damage.

This development is critical as it will dramatically cut repair times. Previously, damaged equipment had to be shipped to Poland or other countries, with logistics alone often taking weeks. Now, repairs can happen directly in Ukraine, slashing maintenance time significantly.

Another key focus is the production of spare parts within Ukraine. KNDS will manufacture the most in-demand components, allowing for stockpiling and enabling faster repairs. This will speed up the return of equipment to the front lines when needed.

A third crucial aspect of cooperation is ammunition production. KNDS has announced plans to manufacture 155 mm shells—one of the most scarce types—within Ukraine. With its extensive ammunition production facilities across Europe, the company is well-positioned to expand, meaning future announcements for other types of munitions are likely.

KNDS’s entry into Ukraine is about speeding up critical processes. Conducting repairs, maintenance, and ammunition production locally will save weeks in logistics. Moreover, it sends a strong message to other companies and the global market: investing in Ukraine and setting up operations here is not only feasible but essential.