Lockheed Martin (NYSE: LMT) and Rheinmetall signed a memorandum of understanding to co-produce ATACMS missiles in Europe, the companies announced July 7 at the NATO Summit Defense Industry Forum in Ankara, Türkiye.

The agreement, backed by the U.S. and German governments, is a step toward establishing a joint venture to create what the companies describe as the first European center of excellence for manufacturing, integration, and distribution of ATACMS missiles for NATO and allied European forces.

Rheinmetall's Unterluess facility in Germany is designated as the production site. Rheinmetall CEO Armin Papperger said the facility would be "the world's first and only production facility for ATACMS guided missiles outside the United States." Production of rocket motors and guided missile components at the site is scheduled to begin as early as 2027. The Unterluess facility employs approximately 4,000 people and hosts what the company describes as the largest privately owned firing range in Europe.

Lockheed Martin stated it will continue operating its existing ATACMS production line in Camden, Arkansas, until the transition to European co-production is complete.

Jay Pitman, president of Lockheed Martin International, said the partnership would "deliver combat-proven capabilities faster and more efficiently to our allies." Dennis Goege, Lockheed Martin's chief executive for Europe, said the arrangement "combines proven U.S. technology with European manufacturing strength, creating industrial value in Germany."

Rheinmetall's Unterluess site has been in operation for over 125 years. The company opened a new artillery ammunition production facility there last year, and a rocket motor factory is nearing completion.