Islam Times – German auto giant Volkswagen has agreed on plans to sell one of its factories and convert the site into a military production hub, with “Israeli” arms manufacturer Rafael Systems set to become its first major industrial partner.Volkswagen announced on Monday that it had reached an agreement with the state of Lower Saxony and the “Israeli” investment company Aurelius Capital on key terms for the sale of its Osnabruck plant. Under the plan, Aurelius would become the majority owner, while Lower Saxony would also take a stake in the facility.
The factory would then be gradually transformed from car manufacturing into what Volkswagen described as a “competence center for security and defense solutions.” Its first anchor project would involve cooperation with Rafael on the manufacture of air-defense systems and components for Germany and other European customers.
Rafael is the “Israeli”-military company behind the Iron Dome missile system. The Osnabrück factory is expected to manufacture equipment including military vehicles, launchers and generators used by the system, although its Tamir interceptor missiles themselves will not be produced there, according to “Israeli” media.
The Osnabruck site has a history of military production dating back to Nazi Germany. The factory originally belonged to coachbuilder Karmann, which produced aircraft components for the German war effort and used forced labor during World War II.
Volkswagen took over the company’s Osnabruck operations following Karmann’s insolvency in 2009 and decided in 2024 to end vehicle production by the summer of 2027. The new arrangement is expected to provide employment to more than 1,200 workers, while Volkswagen Group CEO Oliver Blume said the agreement would open up a “new industrial future” for the site.
The deal had reportedly faced resistance from Qatar’s sovereign wealth fund, one of Volkswagen’s largest shareholders. The eventual structure keeps Rafael out of the ownership of the plant, with Aurelius and Lower Saxony taking it over instead.
The conversion comes as Volkswagen undertakes one of the biggest restructurings in its history. Last week, the company confirmed plans to eliminate as many as 100,000 jobs worldwide by 2030 as it struggles with weak European demand, high energy costs following the loss of cheap Russian supplies, US tariffs and growing competition from Chinese manufacturers.