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IDV and Leonardo Partner to Provide Key Components for Italian Army in LRMV Modernization Program.
On November 11, 2024, Iveco Defence Vehicles (IDV), a division of the Iveco Group specializing in defense and civil protection equipment, signed a preliminary agreement with Leonardo, a leading aerospace, defense, and security entity. This agreement aligns with the Leonardo Rheinmetall Military Vehicles (LRMV) joint venture, recently established between Leonardo and Rheinmetall. Headquartered in Rome with operations in La Spezia, LRMV aims to become a key European player in the production of next-generation military vehicles, focusing on developing a new main battle tank and the Armoured Infantry Combat System (AICS) for the Italian Army, both central to Italy’s land forces modernization program.
The new Panther Evo Upgrade combines the chassis of the Leopard 2A4 with the turret of the KF51 Panther, which includes a 130mm gun (Picture source: Army Recognition)
This comprehensive Italian military modernization project, approved on October 29, 2024, by the parliamentary committee, has a budget of €8.2 billion, set to be allocated from 2025 to 2038. The initiative is led by Prime Minister Giorgia Meloni’s government to enhance national defense capabilities amid increasing regional tensions in Europe, aligning with NATO and EU security priorities. With €5.4 billion dedicated to the initial phase, Italy signals a strong commitment to bolstering national capacities, with an additional €2.7 billion in financing planned for later stages.
The project centers on developing a new main battle tank to replace the aging Ariete tanks, in service since the 1990s, of which around 200 are operational but only 50 fully functional. The Rheinmetall Panther KF51 is expected to serve as the base for this next-generation platform, offering advanced features that meet modern requirements for mobility, firepower, and protection. The Italian Ministry of Defense has proposed a plan to Parliament for replacing Leopard 2 tanks with Panthers, initially ordering 132 tanks and 140 support platforms. Part of the production will take place in Germany and Hungary, while final assembly will occur in La Spezia, ensuring a significant domestic production footprint in Italy.
IDV’s participation in the joint venture will represent approximately 12 to 15% of LRMV’s overall activities. Leveraging its specialized expertise in propulsion, transmission systems, and advanced vehicle protection technologies, IDV will ensure that critical components are manufactured in Italy, supporting the local defense industry and workforce. With a 2023 order portfolio exceeding €4 billion, IDV is well-positioned to strengthen its role in Italy's defense sector. IDV’s involvement in developing these vehicles will also help maintain local production capabilities for future joint venture projects, contributing to European defense autonomy.
Beyond national defense, this German-Italian alliance could also benefit other European nations looking to modernize their combat systems. Responding to the continent's growing demand for defense solutions, this collaboration offers export prospects for next-generation platforms. LRMV’s modular design approach enables multiple vehicle configurations, including anti-aircraft, reconnaissance, and anti-tank versions, meeting the diverse operational needs of the Italian Army and potential international clients. This partnership with Rheinmetall and Leonardo opens new avenues for a more integrated and autonomous European defense sector, addressing increasingly complex security challenges facing Europe.
This joint venture between IDV, Leonardo, and Rheinmetall marks a strategic advancement for both the Italian and European defense industries, enhancing Italy’s capacity to produce and assemble critical components for advanced defense platforms. Through this ambitious program, Italy establishes itself as a key contributor to European defense, ensuring an effective response to current and future security challenges.