German frigate program halt undermines Hensoldt and Rheinmetall earnings

The German defence ministry stopped the F126 frigate programme at the end of June, cancelling the order for six ships. The decision, taken by Defence Minister Boris Pistorius (SPD), is estimated to have cost around €2.4 billion and eliminated radar contracts for Hensoldt worth roughly €200 million. Hensoldt’s share price recovered modestly, trading at €78.76 and up about 3.5 % in a week, with management reaffirming its 2026 targets and signalling confidence by buying shares at €65. The company now faces a shortfall of low‑double‑digit millions in revenue for the year and will be judged by its upcoming half‑year report. The cancellation also reverberated at Rheinmetall, described by analysts as a “frigate disaster”, though the broader impact on its earnings is seen as limited. The issue was debated on a television programme hosted by Markus Lanz, where CDU politician Roderich Kiesewetter defended the stop while Lanz highlighted the €100 million difference between €2.3 bn and €2.4 bn and questioned the value of the project. The discussion also touched on Germany’s reliance on US‑origin weapons such as the €10 bn F‑35 purchase.