A symbolic capsule marking the start of construction of a “Leopard 2A8” tank assembly and repair plant was buried at the Kaunas Free Economic Zone (FEZ). The start of construction of the modern facility marks a significant step in strengthening the development of Lithuania’s defence industry. Investment in the establishment of NATO-standard tank assembly capabilities will help expand the country’s defence industrial capacity and technological self-reliance.
Under an industrial cooperation agreement, German companies “Rheinmetall Landsysteme” and “KNDS Deutschland” plan to invest in and develop the tank assembly and repair facility through their joint venture, UAB “Lithuania Defense Service” (LDS). LDS is expected to be responsible not only for the assembly of “Leopard 2A8” tanks and the maintenance of military equipment, but also, in the future, to service a broader range of armoured vehicles from other Allied countries.
“Epso-G Invest”, managed by UAB “Valstybės investicinis kapitalas”, plans to acquire approximately 25% of the shares in LDS. This would be the second investment in a company operating in the defence industry.
“Investment in the development of Lithuania’s defence industry not only strengthens the country’s military resilience, but also contributes to technological self-reliance and the creation of long-term investment value,” says Vaidas Daktariūnas, CEO of UAB “Valstybės investicinis kapitalas”.
In the future, the joint Lithuanian-German company is expected to be able to service not only the armoured vehicle fleet of the German Brigade stationed in Lithuania but also accept orders from other countries in the region.
The new plant is expected to assemble the first “Leopard 2A8” tank ordered by the Lithuanian Armed Forces in 2028. The remaining tanks are expected to be assembled and delivered to the Lithuanian Armed Forces by the end of 2030. Lithuania has ordered more than 40 “Leopard” tanks in total.
Under the agreement signed by Lithuania with the German Federal Ministry of Defence in 2024 and implemented under the “Cooperative Procurement Arrangement” (LEOPARD 2 CPA) initiative, the tanks were originally scheduled to arrive in Lithuania between 2029 and 2034. However, the planned production capacity will enable all equipment intended for the Lithuanian Armed Forces to be assembled and delivered by 2030.