MGCS Project Company Formed by KNDS, Rheinmetall & Thales

Four of Europe’s biggest land-systems players have set up a single company in Cologne to develop the Franco-German successor to the Leopard 2 and Leclerc — yet the hardest design choices still lie ahead.

KNDS Deutschland, KNDS France, Rheinmetall Landsysteme and Thales have formally established the MGCS Project Company GmbH (MPC), the joint venture that will steer the next phase of Europe’s Main Ground Combat System (MGCS). The four partners incorporated the company in Cologne on 10 April 2025, once Germany’s Federal Cartel Office cleared the deal.

In effect, the move turns years of political intent into an industrial structure. Moreover, it hands a single prime contractor responsibility for a programme that aims to replace the Leopard 2 and Leclerc main battle tanks in the 2040s.

Key points

KNDS Deutschland, KNDS France, Rheinmetall Landsysteme and Thales each hold a 25% stake; Germany and France split the workshare 50/50.
The partners signed the shareholder agreement in Paris on 23 January 2025 and incorporated the company on 10 April 2025.
MGCS is a “system of systems” — a networked family of crewed and uncrewed platforms, not a single tank.
The main-gun calibre (Rheinmetall 130mm versus Nexter 140mm) and the 2040s timeline remain the biggest open questions.

Inside the MGCS Project Company

The four firms own the company equally, at 25% each, while Germany and France share the industrial workload on a 50/50 basis, according to Thales. Notably, because KNDS owns both KNDS Deutschland and KNDS France, the group effectively controls half of the venture — a quiet reflection of its dual Leopard and Leclerc heritage.

To run the new entity, the partners named Stefan Gramolla — a graduate engineer and reserve colonel — as managing director. From here, the company will negotiate a contract with Germany’s defence procurement office (BAAINBw), which acts for both nations through a Combined Project Team (CPT). After that, MPC will serve, in KNDS’s words, “as industrial project manager, for the execution of the MGCS program.”

From letter of intent to incorporation

The programme itself is not new. France and Germany launched MGCS back in 2017, in parallel with the Future Combat Air System (FCAS), as the land counterpart to a joint next-generation fighter. For years, however, the effort struggled to move past concept studies amid industrial rivalry over workshare and weapons.

Momentum returned in spring 2024, when the two defence ministers signed a letter of intent setting out the system’s capabilities. Subsequently, the four partners signed a shareholder agreement in Paris on 23 January 2025, with French Defence Minister Sébastien Lecornu and German Defence Minister Boris Pistorius present. Finally, after the Federal Cartel Office cleared the tie-up, they incorporated the company in April 2025 — completing a step that land programmes rarely reach as smoothly as their aircraft and naval equivalents.

A system of systems, not just a tank

Crucially, MGCS does not describe a single vehicle. Instead, the programme spans eight technological pillars: chassis and automated navigation; cannon, turret and ammunition; C4; the simulation environment; sensor technology; protection and counter-UAV defence; secondary armament; and support, logistics and infrastructure.

As a result, the partners envisage a networked family of platforms — a high-calibre core tank teamed with heavy armoured vehicles, uncrewed ground systems, drones and a shared “combat cloud” for sensor fusion and AI-assisted decisions. The current phase, often described as Phase 1A, is expected to run for roughly four years and to deliver a prototype around 2030, ahead of fielding in the 2040s, as Army Recognition has reported.

The main armament question

The thorniest decision concerns firepower. Although the design is far from frozen, the core platform will likely carry a large-calibre smoothbore gun fed by an autoloader, allowing a three-person crew to sit inside a protected hull. Specifically, the German side backs Rheinmetall’s 130mm Rh-130 L/52, while the French side favours Nexter’s 140mm ASCALON. Both jump well beyond today’s 120mm NATO standard, and analysts at European Security & Defence note that a 140mm round could later open the door to gun-launched missiles and other natures.

Consequently, the calibre choice is more than an engineering question. It also sets the balance of industrial work between the two nations, which is precisely why it has proven so hard to settle.

Why it matters

Strategically, MGCS is about more than a replacement tank. By pooling money and engineering, Berlin and Paris want to cut their reliance on US platforms, tighten NATO interoperability and keep European industry at the leading edge of armoured warfare. Equally important, the programme is a test case: after the friction that has dogged FCAS in the air, a smooth MGCS would show that Franco-German cooperation can actually deliver heavy metal, not just headlines.

What the MGCS Project Company must settle next

For now, the immediate task is the BAAINBw contract that will fund the next phase. Beyond that, several risks loom. First, the partners must finally choose between 130mm and 140mm. Second, the four-firm, two-state governance model could slow decisions rather than speed them. Third, the turret architecture — crewed or uncrewed — remains unresolved, with knock-on effects for protection and crew layout.

Meanwhile, interim upgrades such as KNDS’s Leopard 2 A-RC 3.0 and the Leclerc Evolution will bridge the gap until MGCS arrives. Ultimately, the company’s formation gives the programme a backbone it has lacked for years — but the next two to three years of design decisions will determine whether Europe’s most ambitious tank project finally rolls forward.