The German government is reportedly reviewing a plan to scrap the construction of the F126 frigates, the largest naval vessel program since World War II. With delays and soaring expenses overlapping, it is expected to be difficult to recover the budget already invested, which amounts to several trillion won.
The Financial Times (FT) reported on the 24th (local time) that the German government is moving to halt the plan to build six F126 frigates and instead procure eight smaller Meko A-200 frigates. According to the FT, German Defense Minister Boris Pistorius and senior government officials conveyed this policy to defense industry figures and key lawmakers that day.
The F126 is the largest shipbuilding program pursued by the German Navy since World War II. The 166-meter-long, 10,000-ton displacement multipurpose frigate is designed for long-duration maritime operations, with anti-submarine warfare as a core mission. The program aligned with the North Atlantic Treaty Organization (NATO) strategy to check Russia in the Baltic Sea and the North Atlantic after Russia's invasion of Ukraine.
After signing a contract in 2020 with Dutch shipbuilder Damen Naval to build four F126 frigates, the German government expanded the program by ordering two more. However, the schedule was repeatedly delayed due to software issues and communication problems between Germany's procurement authorities and contractors. Expenses were also reported to have increased far beyond initial expectations.
The FT said the German government expects about €2 billion of the expenses already poured into the F126 program to be written off. At the current exchange rate, that amounts to about 3.5 trillion won.
The decision is also expected to hit Rheinmetall, one of Germany's largest defense companies. Rheinmetall has expanded into shipbuilding by acquiring Naval Yards Lürssen. In particular, Rheinmetall has sought to participate in the F126 program to leap from its existing focus on armored vehicles, artillery, and munitions to a comprehensive defense company spanning land, sea, air, and space. The company had proposed a €12.8 billion contract in return for becoming the program's prime contractor.
In March this year, while announcing a plan to procure four Meko A-200 frigates from German shipbuilder TKMS at about €1 billion per ship, the German government had also been considering pushing ahead with the F126 program in parallel. However, amid growing concerns among Bundestag members over program expenses and the timing of force introduction, the government reportedly moved to a review.
The decision comes as Germany pursues military modernization by investing about €780 billion by 2030. Although Germany is accelerating rearmament in response to the Russian threat, critics note that controlling the expenses of large-scale defense programs and improving procurement efficiency remain challenges.