Volkswagen Group, undergoing a major restructuring, has decided to sell one of its factories in Germany to convert it into a defense production facility.
According to Yonhap News on September 7, Volkswagen Group announced that it has reached an agreement with Israeli investment firm Aurelius Capital and the government of Lower Saxony, the group's second-largest shareholder, to acquire the Osnabrück plant and utilize it as a "security and defense sector specialist center."
Local media reported that Aurelius plans to launch its first project at the facility in collaboration with Rafael Advanced Defense Systems, an Israeli state-owned company that produces the Iron Dome air defense system.
Rumors about Volkswagen transferring the Osnabrück plant to a defense contractor had circulated previously. Volkswagen had approached Rafael for the acquisition, but the Qatar Investment Authority, the group's third-largest shareholder, opposed the move. The joint acquisition by the Israeli investment firm and the German state government is seen as a way to circumvent the objections from Qatar.
The union agreed to the sale of the Osnabrück plant on the condition that approximately 1,400 of the 1,800 employees would retain their jobs until 2029, and efforts would be made to ensure employment for the remaining staff.
Volkswagen currently assembles the T-Roc Cabriolet model at the Osnabrück plant but has agreed with the union to cease automobile production there next year. The Dresden plant, which also had its production halted, is being repurposed by the Technical University of Dresden to create an artificial intelligence and robotics research campus.
Volkswagen's management submitted a restructuring plan that includes reducing its workforce by an additional 50,000, on top of the previously agreed 50,000, with the Emden, Zwickau, Hanover, and Neckarsulm plants seeking new utilization strategies. This plan was approved on September 3.
* This article has been translated by AI.
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