Volkswagen's Osnabrück plant to switch from cars to defence

Volkswagen has reached a preliminary deal to sell its Osnabrück plant in Germany to Israeli investor Aurelius Capital and the state of Lower Saxony. The plant, currently producing cars, will switch to manufacturing defence equipment for Rafael Advanced Defence Systems, the company behind the Iron Dome missile defence system, from mid-2027. According to Investing.com, the deal could preserve around 1,400 of the site's 1,800 jobs.

The agreement is part of Volkswagen's efforts to restructure its plants and address overcapacity in the European market. The company has been struggling with weak demand, high costs, and growing competition from China. As reported by Malay Mail, Volkswagen CEO Oliver Blume said the deal was an important step towards opening up a new industrial future for the site, and that the company stands by its responsibility for Osnabrück.

The Osnabrück plant is currently set to end vehicle production in 2027. The long-term future of four other German factories is also uncertain, with Volkswagen warning that they could face closure or repurposing unless alternative uses can be found. According to Expansion ES, Aurelius Capital will be the majority shareholder in the new venture, with the state of Lower Saxony also participating.

Brief written by urgent.news from France 24 Business, Expansion ES, Investing.com, Bangkok Post Business, Malay Mail — 5 reports on this story. Machine-written — may contain errors; check the original before relying on it.