Volkswagen’s (VW) Osnabrück plant could become a defense hub under a planned takeover by Aurelius Capital and the German state of Lower Saxony, with Rafael Advanced Defense Systems lined up as an initial industrial partner.
Talks between VW and Rafael to possibly repurpose the Osnabrück site, where vehicle production is targeted to end by 2027, into a facility for producing Iron Dome components were first reported in March.
However, a direct deal between the two companies was reportedly blocked after Qatar — VW’s third-largest shareholder — vetoed a planned joint venture involving the Israeli defense firm.
A workaround emerged with VW selling the site to a partnership between the German state of Lower Saxony — the company’s second-largest shareholder — and the Tel Aviv-based investment firm Aurelius Capital.
In September, Rafael signed a joint Statement of Intent with the German-Israeli partnership, with Aurelius identified as the majority owner.
Future of the Osnabrück Site
Under the latest agreement, the three parties will establish a strategic partnership that aims to develop the VW site “into a center of excellence for innovative security and defense solutions.”
While the preliminary deal does not identify Iron Dome or another specific Rafael system, Rafael stated that the collaboration’s initial focus will be on the “potential development and production of components for air defense systems” for Germany and Europe.
Further projects could also emerge from the collaboration, possibly including converting VW Amarok pick-up trucks into military vehicles, according to Reuters.
“With this agreement, we are unlocking a genuine industrial opportunity for Osnabrück. The site boasts a highly-skilled workforce, well-established structures, and extensive experience in handling demanding tasks,” said Olaf Lies, Minister-President of the State of Lower Saxony.
Transforming the Osnabrück plant into a defense hub would secure about 1,400 jobs.
Detailed negotiations, assessments of regulatory requirements, and internal decision-making processes will follow.
