Bulgaria Sets 30-Month Target for Rheinmetall Ammunition Plant

Bulgaria has set a target of up to 30 months to establish a planned Rheinmetall ammunition and energetic materials plant as Sofia and the German defense group continue restructuring one of the country’s largest defense-industrial projects.

Deputy Prime Minister and Minister of Economy, Investments and Industry Alexander Poulev said on October 4 that the government has held a series of meetings with Rheinmetall on the main parameters of the project. Bulgaria is also seeking full technology transfer as part of the revised arrangement.

The project originated in an agreement announced in October 2025 between Rheinmetall and Bulgaria’s state-owned VMZ. Rheinmetall said at the time that the joint venture would invest approximately €1 billion in production capacity for artillery ammunition and energetic materials, with Rheinmetall holding 51% and VMZ 49%.

The planned industrial complex was originally expected to cover around 100 hectares in the Sopot region and create approximately 1,000 jobs. Rheinmetall initially expected production to begin in 2027.

Those assumptions are now being revisited.

Poulev said the final site remains subject to additional negotiations and inspections. According to the minister, previously considered locations lacked sufficient electricity, water and other basic infrastructure required for an energetic materials production facility.

The Bulgarian government is therefore evaluating alternative sites it believes could support faster implementation.

The current administration has also questioned parts of the original project structure. In July, Poulev said authorities had identified several problems with the mechanism proposed for the Rheinmetall-VMZ project and that a broader restructuring process would be required. Rheinmetall representatives at the time reiterated their intention to continue working with Bulgaria.

Earlier this month, the government said it would continue actively structuring the proposed investment with Rheinmetall.

The proposed facility remains strategically important for Bulgaria because it would establish new domestic capacity for NATO-standard artillery ammunition and energetic materials at a time when European governments are expanding ammunition production.

For Sofia, however, the negotiations have increasingly shifted toward the industrial terms of the investment, including infrastructure, financing, technology transfer and the future role of VMZ.

The 30-month target should therefore be viewed as a government objective rather than a confirmed construction schedule. No new final site or revised implementation agreement has yet been announced.