Italy’s new MBT will be based on the KF-51 Panther tank from Germany’s Rheinmetall

The Italian Army will significantly augment its armoured capability over the coming years through the Armoured Infantry Combat Systems (AICS) and new Main Battle Tank (MBT), programmes that could offer hundreds of millions of euros in revenue during their lifetime.

Detailed in the updated Industrial Strategy of Italian defence prime Leonardo, published on 11 March, the AICS and new MBT programmes could generate an “estimated upside” of €1bn ($1.1bn) over the course of the acquisition, the company stated.

In total, the programmes will see the delivery of 1,050 AICS units and 272 MBTs by 2040 to the Italian Army. The AICS will be derived from the Rheinmetall’s KF41 infantry fighting vehicle (IFV), with the new MBT basing itself on the company’s KF51 Panther tank.

Italy is looking to replace its Ariete MBT, which has been in service since 1994. Credit: US DoD

In October 2024 Rheinmetall and Leonardo determined to form a joint venture (JV) to create a European hub to develop and produce military combat vehicles, which followed the signing of a memorandum of understanding earlier the same year. The new JV was planned to be operational by Q1 2025.

Known as Leonardo Rheinmetall Military Vehicles (LRMV), the JV will have headquarters in Rome, an operational base in La Spezia, and focus on the industrial development and marketing of Italy’s new MBT and AICS requirements.

JV created amid “considerable movement” in defence sector

In January 2025, Germany’s Federal Cartel Office (Bundeskartellamt) approved the establishment of a JV between Rheinmetall and Leonardo to develop and produce military armoured vehicles.

Understatedly, Bundeskartellamt president Andreas Mundt said: “Given the current geopolitical situation, there is considerable movement in the defence industry.”

It was determined that individually, the two companies lacked the capacity to meet the Italian Ministry of Defence’s anticipated procurement demands.

Italy will replace its Dardo IFV, among other armoured mobility platforms, with the new AICS. Credit: US DoD

The evaluation considered Leonardo’s absence of suitable platforms for manufacturing MBTs and Rheinmetall’s inability to fulfil the requirement that 60% of the value-added work be conducted within Italy.

Rheinmetall and Leonardo will each hold a 50% share in LRMV, with the former providing expertise in amoured vehicles, while the latter will specialise in defence electronics.

Hungary Lynx
The Lynx KF41 is being adopted by several militaries, including Hungary. to the Hungarian. Credit: Rheinmetall AG

The new KF51-based MBT will replace the current Ariete tanks, while the KF41 derived IFV will assume the role of the incumbent, and ageing, armoured platforms like the VCC-80 Dardo and M113.

Italy had earlier seen talks to acquire Leopard 2A8+ MBTs from Rheinmetall fall through, with Rome opting instead to develop the KF51 through the new JV.

The JV will also develop and produce additional vehicles for various support roles, including recovery, engineering, and bridge-laying functions, for a total of 16 variants in the AICS.