As Europe moves from peacetime complacency to a new era of defence readiness, budgets across the continent have surged. According to recent data from the Stockholm International Peace Research Institute, global military spending reached $2.7 trillion in 2024, a 9% increase year on year. Europe outpaced all other regions, expanding defence outlays by 17%, driven by the war in Ukraine and the urgent need to rebuild its industrial base.

 

Brussels has responded by launching the SAFE (Security Action for Europe) financial instrument in May 2025, capable of providing up to €150 billion in long-maturity loans to EU member states for urgent defence investments under the ReArm Europe / Readiness 2030 framework, which aims to mobilise more than € 800 billion in total defence spending. In this environment of rapidly expanding budgets and increasingly strict local-content requirements, Turkey’s leading land platform manufacturer and export leader, operating worldwide with more than 80 end users Otokar is deepening its engagement in Romania’s ATBTU (4×4 light tactical armoured vehicle) programme and plans to acquire its sub-contractor, Automecanica SA.

 

From contract execution to industrial anchoring

Otokar already plays a central role in Romania’s defence modernisation. In 2025, the company secured an €857 million contract to supply 1,059 Cobra II 4×4 armoured vehicles to Romtehnica. Under the terms of the agreement, 781 vehicles will be produced locally. To meet this requirement quickly and efficiently and in line with its full commitment to the Romanian defence industry, Otokar established Otokar Land Systems SRL and formed a 50-50 joint venture with Automecanica (SAROM S.R.L.) to assemble the vehicles in Mediaș.

Managing a large-scale defence programme—meeting the national interest of Romania and positioning the country for future European tenders—require long-term industrial capability.

In the frame of above status and long-term strategy and to operate in the most efficient way in line with the national interest of Romania, in January 2026, Otokar filed a disclosure with the Turkish Public Disclosure Platform (KAP) announcing its intention to acquire Automecanica’s shares. The memorandum of understanding values the price about €85 million with completion targeted by the end of April 2026 pending due diligence and regulatory approvals.

The acquisition aims to streamline the industrial structure by eliminating intermediaries and enabling direct engagement of Otokar with the Romanian defense industry. This approach ensures full flexibility in investment and technology transfer decisions to Romania in strict compliance with EU regulations, leveraging the advantages of operating as a Romanian legal entity. Beyond anchoring the program domestically, the transaction reinforces Romania’s position as a reliable European manufacturer, holding the requisite licenses and capabilities.

In comments to Turkish media, Otokar CEO Aykut Özüner’s assessment of the matter is as follows: “Otokar initiated this project with the strong commitment and objective of ‘establishing a modern, NATO-standard land platform manufacturing facility in Romania’. This objective remains as our strongest priority. In line with our strong commitment to the Romanian Government and our desire to show our best NATOrts to fulfill our obligations under the project, we are proceeding with great care on our efforts to make Romania a NATO supplier in land platforms.”

Aykut Özüner, CEO Otokar

 

A long-term European strategy

For Otokar, the move goes well beyond the current contract. Mr. Özüner has emphasised that the investment in Romania serves both the ATBTU programme and the company’s broader European ambitions. Owning a production facility inside the European Union would allow Otokar to participate more effectively in EU-funded defence programmes and to operate fully within Europe’s regulatory and industrial ecosystem.

Through this transaction, the Automecanica facilities in Mediaș will become Otokar’s first manufacturing site within the European Union, strengthening both the company and Romania’s position, as initiatives like SAFE increasingly favor locally based production and limit the use of non-EU components, marking a shift from short-term contracts to long-term industrial integration.

Last but not least, the General Manager Aykut Özüner has also underlined that Romania is considered by them not just as a customer but also a strategic hub for European markets using NATO-standard technologies and production infrastructures along with a wide product range.

 

Managing short-term strategy

The ATBTU programme has recently faced compensation claims from Romtehnica totalling 191.85 million Romanian lei (approximately EUR40 million), linked to alleged delays in meeting interim milestones. Otokar has paid and will continue to pay the notified amounts on their due dates. The company has challenged the claims in court while reserving the right to settle if required, stressing that such disputes are not uncommon in large international defence projects and do not reflect deficiencies in technical capability or production capacity.

Notably, Otokar announced its intention to acquire Automecanica after these claims emerged, reinforcing the message that the company remains confident in the programme and committed to Romania despite short-term contractual tensions. While the negotiations between Otokar and Automecanica continue, the vehicle deliveries and production preparations are currently ongoing. 240 units Cobra II has been delivered to Romanian Armed Forces.

 

Broader picture

Recent public debate in Romania has focused heavily on penalties and disputes, often obscuring the strategic context. Europe is entering its most significant defence rearmament cycle since the Cold War, and EU initiatives increasingly favour production rooted within member states. By hosting a local manufacturing and support hub for the Cobra II, Romania stands to strengthen its industrial base, create skilled jobs and enhance its role on NATO’s eastern flank.

For Otokar, the acquisition of Automecanica represents a decisive step in embedding itself within the European defence market. Full control of a Romanian production base will help the company meet localisation requirements, integrate local suppliers and workforce, and compete more effectively in future EU defence programmes. While challenges remain, the shift from a joint venture to a majority acquisition signals a clear, long-term commitment to Romania and to Europe’s evolving defence landscape.