Rafael bypasses Qatari boycott: Iron Dome components to be produced at Volkswagen plant
The opposition of Qatar, which holds 17% of Volkswagen, will not stop the project: the state of Lower Saxony is expected to replace the automaker as Rafael's partner. The German plant will produce components for the Iron Dome, preventing thousands of layoffs and potentially signaling future system purchases by Berlin.
Qatari opposition will not stop the deal between Volkswagen and Rafael: according to reports in Germany, a solution is emerging to bypass the veto imposed by the Persian Gulf state, which is close to Hamas, on a partnership between the Iron Dome manufacturer and the automaker. The Qatar Investment Authority holds 17% of Volkswagen shares.
According to media reports, the state of Lower Saxony, which holds 20% of Volkswagen shares, may serve as a partner for Rafael in the project instead of Volkswagen itself.
"We are currently examining whether and in what form we can consider participating in a potential industrial solution for the future at the Osnabrück site," said the Minister-President of Lower Saxony, Stephan Weil. "The site has highly motivated employees with extensive technical expertise — we want to leverage this base for a sustainable economic future."
The investment by Lower Saxony could reach 200 million euros.
Volkswagen expected to cut about 100,000 jobs
German officials are trying to prevent the layoff of 2,300 workers at the Osnabrück plant, where car production will cease in 2027 as part of a major cost-cutting plan at Volkswagen. The plant, established in 1902, was later acquired from the Karmann firm and currently builds the open-top version of the T-Roc crossover.
Volkswagen is looking for a way to keep the plant operational. Rafael seeks to produce components for the Iron Dome there, including launchers and generators, and to convert trucks for the mobility of the interception system. Rafael has not disclosed the end customer for these components.
The company already produces Spike missiles and the Trophy active protection system for tanks in Germany for the German army and other clients. Establishing infrastructure for Iron Dome components in the country may hint at a future deal to sell the system to Germany or other European customers.
Osnabrück is one of four plants where Volkswagen intends to stop production. Worldwide, the company plans to cut approximately 100,000 jobs.
The European automotive industry is facing high production costs, a challenging transition to electric vehicles, and increasing competition from Chinese manufacturers. Sales of German carmakers in China are declining, while Chinese manufacturers such as Chery, BYD, and MG are steadily increasing their market share in Europe and beginning local production.
