KNDS will establish a new assembly plant in Kaunas, Lithuania, marking a significant expansion of Leopard 2A8 main battle tank production within Europe. Under an agreement signed with the Lithuanian Ministry of Defense, the facility will assemble up to 41 tanks, with Lithuania Defense Services supporting the project as a subcontractor. The move represents one of the most substantial defense industrial investments in Lithuania to date and positions the country as a direct contributor to Europe’s heavy-armor manufacturing base.
A separate support arrangement guarantees long-term availability of the Leopard 2A8 fleet once deliveries begin. This includes training Lithuanian personnel in both production and maintenance, as well as providing logistics support for a five-year period following the handover of the first vehicle. By linking training, sustainment, and supply chain support to the initial production contract, Lithuania aims to build a more self-reliant capability for managing its future tank fleet.
The new plant follows Lithuania’s 2024 decision to procure 44 Leopard 2A8 tanks through the Common Procurement Agreement, a multinational framework coordinated by the German government. Lithuania was the first country to join the CPA, and the establishment of domestic assembly capacity illustrates how the program is evolving beyond procurement into shared industrial development. Deliveries of the tanks to the Lithuanian Armed Forces are scheduled for 2028 through 2030.
This development carries strategic importance for both Lithuania and NATO. By hosting its own assembly line, Lithuania reduces dependence on external production bottlenecks and contributes to strengthening Europe’s overall armored vehicle supply chain. The project also improves the country’s ability to sustain heavy units deployed along NATO’s eastern flank—a region where readiness and rapid reinforcement are central to alliance planning. As Europe continues to expand its defense industrial output, Lithuania’s role in Leopard 2 production highlights a broader shift toward more distributed, resilient manufacturing across the continent.
For KNDS (a holding formed by Germany’s Krauss-Maffei Wegmann and France’s Nexter), this move represents a decentralization of the European defense industrial base. Rather than solely exporting finished goods from Germany, KNDS is integrating local partners like Lithuania Defense Services into the supply chain. This model not only speeds up delivery but also satisfies political demands for local workshare and technology transfer in client nations.
A military history enthusiast, Richard began his career at Forecast International as editor of the World Weapons Weekly newsletter. As the Internet became central to defense research, he helped design the company’s Forecast Intelligence Center and now coordinates the FI Market Recap newsletters for clients. He also manages two blogs: Defense & Security Monitor, which covers defense systems and international security issues, and Flight Plan, focused on commercial aviation and space systems.
For more than 30 years, Richard has authored Defense & Aerospace Companies, Volume I (North America) and Volume II (International), providing detailed data on major aerospace and defense contractors. He also edits the International Contractors service, a database tracking all companies involved in programs covered by the FI library. Richard currently serves as Manager of the Information Services Group (ISG), which develops outbound content for both Forecast International and Military Periscope.
