Munich defence tech booms as Europe rearms

Munich is growing as a centre for defence technology startups as Europe increases military spending and the war in Ukraine drives demand for drones, software and autonomous systems.

Companies including Quantum Systems, Helsing and Tytan Technologies are among dozens of military technology firms operating in and around the German city. Industry figures say the region benefits from aerospace and defence experience, technical universities, skilled workers and political support.

Martin Karkour, chief revenue officer of drone maker Quantum Systems, said the Munich area combines engineering, software, artificial intelligence and robotics skills. Quantum Systems, founded in 2015, supplies drones to Ukraine's armed forces and other militaries and has expanded into unmanned systems on land and at sea.

Tytan Technologies makes interceptor drones designed to counter hostile unmanned aerial vehicles. The company was founded in 2023 by two graduates of the Technical University of Munich after they took part in a Ukraine hackathon on lower-cost ways to fight hostile drones.

Tytan has worked with Germany's armed forces on a drone to protect installations from hostile UAVs and is also present in Ukraine. The company has increased its staff tenfold and is due to open a new production site.

The local Chamber of Commerce and Industry says the number of pure defence startups around Munich has doubled to about 60 in recent years. Munich mayor Dominik Krause said cooperation among companies, universities and state authorities had helped the sector grow.

Startups still face obstacles. Maximilian Epp, a defence expert at the chamber of commerce, said companies can struggle to expand production because permits for warehouses and production sites have not come through.

Germany's defence technology boom comes as the country backs Ukraine and reports suspicious drone sightings at sensitive sites. The sector also faces security risks. The chief executive of Bavaria-based drone maker Donaustahl has reportedly gone into hiding because of a Russian assassination plan, and a plot to kill the head of Rheinmetall was foiled in 2024.