Israel's Rafael to Produce Iron Dome Components in Germany

Israeli defense contractor Rafael Advanced Defense Systems has announced plans to acquire the Volkswagen factory in Osnabrück, Germany, in partnership with the state of Lower Saxony and a multinational investment fund founded in Israel. The facility will be repurposed to manufacture components for the Iron Dome missile defense system, among other defense products. This agreement follows months of complex negotiations and reportedly bypasses opposition from the Qatar Investment Authority, which holds a 10% stake in Volkswagen and had resisted collaboration with Rafael on defense systems.

The deal is expected to save thousands of jobs at the factory, which was slated for closure by Volkswagen next year. A memorandum of understanding has been signed, outlining a joint commitment to develop the Osnabrück site. Further detailed negotiations, regulatory reviews, and internal approvals are pending. Lower Saxony will actively support the process.

Olaf Lies, leader of Lower Saxony, stated that the agreement provides the Osnabrück site with a future and the necessary industrial infrastructure to re-establish itself in a strategic sector. He emphasized that Germany and Europe need to strengthen their defense industries and independence due to the changing security landscape, presenting both a responsibility and an economic opportunity for Osnabrück.

Rafael CEO Yoav Turgeman highlighted the partnership's foundation in "groundbreaking, proven technology" designed to counter current threats and prepare for future challenges. He added that the technology will be fully produced in Germany, contributing to the security of Germany and Europe. Notably, Germany has not yet purchased the Iron Dome system.

Tomer Yaakov, co-founder of the Aurelius investment fund, expressed pride in transforming the advanced automotive plant into a leading defense manufacturing hub. He stated the collaboration aims to enhance the security of Germany and Israel and create significant value for all parties, marking the first step in a growing strategic partnership.