Concerns Over German Military's Dependence on American Technology

According to a report by Reference News on March 1, the French newspaper Le Monde reported on February 25 that the German Bundestag approved the procurement of combat drones for the Bundeswehr on the 25th, but the procurement amount was reduced. Two companies will provide these drones to Germany, and American investor Peter Thiel, who has close ties to Trump, holds shares in one of the companies, which has sparked controversy.

This is the largest drone procurement contract signed by the German Ministry of Defense to date. The resulting controversy highlights a recurring issue: the Bundeswehr's dependence on the U.S. defense industry.

The German Bundestag's Defense Committee and Budget Committee were originally scheduled to approve the procurement of combat drones worth over 4 billion euros from two German companies, Hensoldt and Rheinmetall. However, shareholders of Rheinmetall include American investor Peter Thiel. Unexpectedly, the order received only partial approval.

The initial order involves thousands of drones, with the first deliveries set to begin this fall, intended to equip the Bundeswehr combat brigade currently deployed in Lithuania. German Defense Minister Boris Pistorius hopes to make this brigade a symbol of the modernization of the German military.

In addition to the enormous amount, the contract has raised questions due to Peter Thiel's stake in Rheinmetall. It is reported that he will receive two-thirds of the contract amount, nearly 3 billion euros. Besides Thiel, shareholders of Rheinmetall also include the NATO Innovation Fund and IQT, a company created and managed by the CIA. Since the company is not publicly listed, its shareholder composition is not disclosed.

As one of Trump's earliest supporters, Thiel wields significant influence in the defense and security industry. His co-founded data analytics company Palantir Technologies has gained cooperation recognition from police in several German states.

Thiel is also a shareholder in the Munich-based drone startup Quantum Systems, which focuses on civil and military reconnaissance drones and has collaborations with the Bundeswehr.

However, Thiel's disparaging remarks about democratic institutions have caused unease among Green Party lawmakers, who are calling for a comprehensive review of his influence in Rheinmetall.

The Bundestag's Budget Committee rejected the contract submitted by the government. They believe the amount involved is too high to be reviewed all at once. Therefore, they set a procurement cap of 1 billion euros for each supplier and approved an initial investment of 269 million euros for each supplier, requiring the government to submit the matter to the Bundestag for further review.

This compromise has not quelled all doubts. Green Party lawmaker and defense and budget affairs expert Sebastian Schaefer expressed dissatisfaction, stating, “As of now, the government knows nothing about the actual controlling entity of the company that may receive billions of euros in drone contracts.”

He emphasized that in the defense and security sector, “it is particularly important to reduce external dependencies by procuring from Europe.”

Germany's defense sector is highly dependent on U.S. suppliers, especially after the outbreak of the Russia-Ukraine conflict.

According to data from the Kiel Institute for the World Economy, from 2020 to April 2025, Germany's total military procurement is approximately 150 billion euros, with nearly half flowing to foreign military enterprises, led by U.S. companies.

Economist Guntram Wolff, who collaborates with the institute, noted that about one-third of the contracts in this overseas procurement went to German-American joint ventures, and about 15% went to U.S. companies.

Within Europe, Germany primarily procures equipment from the European company Airbus, with very few purchases from French companies. (Translated by Wang Zhongju)