Instead of cars, components for the Israeli missile defense system “Iron Dome” could soon be produced by Volkswagen.
03/25/2026, 04:0403/25/2026, 04:04
According to information from the Financial Times, Volkswagen (VW) is in talks with the Israeli defense company Rafael Advanced Defense Systems about a deal in which production at one of the VW plants will be converted from cars to missile defense.
The Iron Dome in action: An interceptor missile fires an Iranian projectile over Tel Aviv.Image: keystone
According to two people familiar with the plans, the two companies want to convert the factory in Osnabrück so that components for the Israeli state-owned company’s “Iron Dome” air defense system will be manufactured there in the future. According to the Financial Times, both companies hope that all 2,300 jobs at the plant in Lower Saxony could be retained.
They are also hoping to sell the systems to European governments. «The potential is enormous. But it is also an individual decision of the employees whether they want to be part of this project,” said one of the people in the know. According to a second person, the German federal government is also actively supporting the project.
VW already produces military vehicles through a joint venture between its subsidiary MAN and the German defense company Rheinmetall. According to current plans, the Osnabrück factory will produce various parts of the “Iron Dome” system – including heavy-duty vehicles that transport the rockets, as well as launchers and power generators. However, the rockets themselves are not intended to be manufactured there.
According to one of the sources, the conversion would only require comparatively little additional investment. “Some money is needed for the change, but it is relatively uncomplicated,” it said. The idea is to “combine proven defense technology with German industrial production”. Production could start within 12 to 18 months – assuming workers agree to the switch to defense production, according to another person familiar with the matter.
VW before historic conversion: car factory becomes armaments factory
Rafael also plans to set up a separate production facility in Germany for the system’s missiles, as they need to be manufactured at a specialized location. The company hopes to sell the “Iron Dome” system to governments across Europe, including Germany. The background is the massive armament of many countries as a result of the Russian war of aggression against Ukraine. Rafael chose Germany as the production location because the country is considered one of Israel’s strongest supporters in Europe, a third person familiar with the plans told the Financial Times.
The move comes as Germany plans to invest more than 500 billion euros in defense by the end of the decade. Air defense is considered one of the most important priorities.
Israel attributes the success of its air defense – a complex interplay of multiple systems – to the fact that more than 90 percent of the missiles fired at the country are intercepted. However, some experts doubt that the “Iron Dome” system, which has a range of around 70 kilometers and was used primarily against rockets from the Gaza Strip, is suitable for protecting European countries against more far-reaching threats.
Volkswagen, for its part, has been looking for a solution for the factory in Osnabrück for some time, where vehicle production is to be stopped next year as part of an austerity program from 2024. Around 50,000 employees are expected to leave the VW factories by 2030 – but exclusively on a voluntary basis.
However, the partnership with Rafael would mark a significant return to weapons production: During World War II, VW manufactured military vehicles and the V1 flying bomb for Hitler’s Wehrmacht. When asked, Volkswagen did not initially comment on the reports.
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