German defense company Renk is turning to the struggling auto sector for skilled workers as it expands to meet the rising demand for military equipment. This comes after Germany passed a major defense spending package and amid heightened tensions due to the war in Ukraine.

Renk, which makes gearboxes for tanks, has seen its stock value triple in 2025 and its order book grow by 164% in the first quarter alone. To support this rapid growth, Renk and other companies like Rheinmetall and Hensoldt are hiring engineers and specialists from the automotive industry — a sector that’s been hit hard by Germany’s slow economy, competition from China, and U.S. tariffs.

Renk’s CEO Alexander Sagel, who has worked at Daimler and Rheinmetall, told CNBC the company is benefiting from this transfer of knowledge. Chief Operating Officer Emmerich Schiller, formerly with Mercedes-AMG, said they’re looking for engineers who bring with them automotive practices like continuous improvement and efficiency methods.

Germany’s largest trade union IG Metall noted that while this shift creates jobs and supports collaboration between sectors, there’s concern over too much focus on rearmament. The union emphasized that long-term peace should remain the goal.

Analysts at Deutsche Bank pointed out that many auto plants are underused and about 100,000 jobs are at risk. They said there’s a rare chance to use Germany’s auto expertise to boost its defense sector and make it more profitable.

The German Association of the Automotive Industry (VDA) supports these cross-industry collaborations, saying it could help maintain jobs and strengthen Germany as a manufacturing hub. Monika Schnitzer from the German Council of Economic Experts said that with job cuts in the auto industry likely, helping workers move into defense roles through training and company transitions is crucial.