A major Italian acquisition of Leopard tanks is on the brink of collapsing after a cooperation deal between tank manufacturer KNDS and Italy’s Leonardo was scrapped on Tuesday due to a row over technology transfer. Announced in December 2023, the partnership between Leonardo and the German-French alliance was due to lead to an industrial role for the Italian defense giant in a large planned Italian purchase of Leopard tanks, including 130 combat versions. Leonardo aimed to add its own components and electronics to the tank, which was to be assembled at its facility in La Spezia, Italy, but the surprise announcement by KNDS on Tuesday indicated Leonardo wanted more input that KNDS was prepared to offer.
KNDS, the manufacturer of Leopard tanks, stated that it is no longer in talks with Leonardo regarding a potential partnership with the Italian company. Leonardo, in response, announced the interruption of negotiations with KNDS and expressed its commitment to meeting the Italian Army’s requirements for a Main Battle Tank program. The breakdown in talks may impact Italian plans for a new tracked fighting vehicle and Leonardo’s potential entry into KNDS as a stakeholder.
National interests in the defense industry remained paramount, despite the pressure for consolidation in the face of global competition. Talks between the companies broke down due to disagreements over technology transfer and tank configurations. Italy may now consider buying the Rheinmetall Panther KF51 tank instead of the Leopard. The rupture between KNDS and Leonardo could also affect Italy’s participation in the Main Ground Combat System program.
