Rafael’s German factory plan faces a new twist as Volkswagen weighs exit
The carmaker could reportedly abandon its Osnabrück plant, opening a possible route for Rafael to establish production there through a new ownership structure.
Volkswagen is preparing to withdraw completely from its Osnabrück plant, potentially clearing the way for Rafael to establish defense production at the German factory under a new ownership structure.
The German carmaker could announce its exit as early as Monday, according to WirtschaftsWoche. Lower Saxony and private investor Aurelius are expected to take over the site and create conditions for companies including Rafael to begin production.
Volkswagen has not confirmed the move. A company spokesperson told WirtschaftsWoche that no decision had yet been made on the plant's future.
The development would mark a major shift from the original plan, which called for Volkswagen to cooperate directly with Rafael on producing equipment for the Iron Dome air-defense system. That proposal ran into opposition from Qatar, Volkswagen's largest foreign shareholder, because of its ties to Israel.
By leaving the plant, Volkswagen would remove itself from the proposed defense project while potentially allowing Rafael's plans to move forward.
Rafael is expected to produce military vehicles, launchers, generators and other equipment at the site. The Tamir interceptor missiles themselves are not expected to be manufactured in Osnabrück.
The factory currently employs around 2,300 people and is scheduled to lose its existing automotive production. Volkswagen is seeking to reduce excess capacity as part of a broader restructuring of its German operations.
Aurelius, a Munich-based financial investor specializing in corporate carve-outs, is expected to play a central role in the new structure. The investor would take over the industrial site together with Lower Saxony and seek to develop new business there.
That could include other defense companies. KNDS has been discussed as a potential user of the factory, while Rheinmetall has also inspected the site but reportedly ruled out taking over the entire plant.
The biggest challenge will be filling a factory built for the automotive industry. Rafael's planned production would use only part of the site's capacity, meaning additional companies would likely be needed to sustain a large portion of the workforce.
The plan remains subject to negotiations and has not yet been formally announced by Volkswagen.
