![\"Volkswagen\u2013Rafael](\"https:\/\/www.europesays.com\/germany\/wp-content\/uploads\/2026\/06\/1781772915.webp\" "\\"Volkswagen\u2013Rafael")
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Credit: Sean Gallup \/ Staff \/ Getty Images<\/p>\n
Volkswagen\u2019s plan to partner with Israeli defense firm Rafael to produce weapons at its underused Osnabr\u00fcck plant is facing complications due to opposition from Qatar\u2019s sovereign wealth fund, the company\u2019s third-largest shareholder. <\/p>\n
Three people familiar with the matter told\u00a0Reuters\u00a0that Qatar, which holds 17% of voting rights in Europe’s biggest carmaker via the Qatar Investment Authority, has raised concerns about the talks between the two companies, citing the Gulf state’s complicated relationship with Israel, News.Az<\/a> reports, citing The New Arab.<\/a><\/p>\n That risks delaying one of Volkswagen’s<\/a> key projects in its ongoing turnaround, including attempts to offload idling plants via deals with defence firms as low auto sector demand across the continent bites.<\/p>\n Spokespeople for Volkswagen, the group’s supervisory board and the QIA all declined to comment on the matter, which has been previously unreported.<\/p>\n Volkswagen has been in talks with defence companies about the future of Osnabrueck, where production is currently scheduled to end next year.<\/p>\n State-owned Rafael is interested in manufacturing components for Israel’s Iron Dome missile defence system at the plant, and has signed a letter of intent to buy the site, sources told\u00a0Reuters\u00a0in late April.<\/p>\n The prospect of Qatar’s sovereign wealth fund facilitating a deal with an Israeli defence company would place Doha in an uncomfortable position at a time of escalating conflict in the Middle East.<\/p>\n Qatar has no formal diplomatic relations with Israel and has instead carved out a distinct role as a back-channel mediator between Israel and Hamas, which maintains a political office in Doha.<\/p>\n There is also deep and widespread public support in\u00a0Qatar\u00a0for the Palestinian cause, and Doha has long made any normalisation of relations with Israel conditional on a credible pathway to Palestinian statehood.<\/p>\n The QIA is Volkswagen’s third largest shareholder after the Porsche SE investment vehicle of the family owners and the state of Lower Saxony. It has two seats on the carmaker’s supervisory board.<\/p>\n Two sources said that Lower Saxony, home to Osnabrueck and Volkswagen’s headquarters in Wolfsburg, could be brought on board via a joint venture between Volkswagen and Rafael in order to reach a solution.<\/p>\n State premier Olaf Lies, who sits on Volkswagen’s supervisory board, declined to comment directly on the\u00a0Qatar\u00a0issue, urging Volkswagen to find a long-term solution for the Osnabrueck plant, which employs 2,300 workers.<\/p>\n “I expect the company to live up to this responsibility and present the announced decisions in a timely manner. The state will provide constructive support wherever it is appropriate and possible,” he told\u00a0Reuters.\u00a0<\/p>\n