VDL to lease factory halls to Defence

Defence has signed a lease agreement with VDL for the halls to scale up the production capacity of the Dutch defence industry. “VDL has the experience and resources to set up production lines. In this way, we not only protect the safety of the Netherlands and our allies, but we also strengthen our economy and create more employment,” says Minister of Defence Ruben Brekelmans.

With the deal, Defence will soon have access to some 120,000 square metres of production halls. Military vehicles and drones can be maintained, upgraded and produced there. The exact use of the spaces will become clearer before the end of the year.

Outcome

For VDL, the deal is a favourable development. At the location in Born, cars were produced for BMW until early 2024. VDL has found a new partner in Defence. It is not clear to what extent VDL itself will also use the halls it rents out.

“The Dutch government is calling on VDL Groep to use our competences to scale up the Dutch defence industry,” says VDL CEO Willem van der Leegte. “Given the geopolitical situation, we see the urgency to take our responsibility. That is why we are committing ourselves to meeting the needs of the Dutch government.” It was previously announced that VDL may also want to build drones itself.

Trend

The agreement between VDL and the ministry fits into a broader trend in which the defence industry is increasingly seeking cooperation with companies from the Eindhoven region.

The Netherlands, under pressure from NATO and the United States in particular, is going to invest billions of euros in defence. The increase in weapons production must be paid for by increasing or cutting back on taxes for residents. For example, the current caretaker cabinet is cutting back on higher education.