Volkswagen Group has reached an agreement with the State of Lower Saxony and Aurelius Capital on the possible sale of the Volkswagen Osnabrück site.
The aim of the transaction is to preserve the site over the long-term. The plan provides for Aurelius, as the majority owner, to take over Volkswagen Osnabrück GmbH together with the State of Lower Saxony.
Under the sale plan, the site will be converted for the manufacture of defence equipment. The annlouncement comes as Volkswagen Group sets a strategy for major restructuring of its operations to address the global challenges it faces.
GlobalData forecasts that this year the Osnabrück plant will build around 10,000 units of the outgoing first-generation T-Roc SUV (factory code VW276) before phase-out in 2027. The second-generation T-Roc (VW386) is in production in Portugal at VW's Setubal plant.
VW said that Aurelius and the State of Lower Saxony intend to develop the site over the coming years into a competence centre for security and defence solutions. As an initial anchor project, Aurelius and the State of Lower Saxony are planning to cooperate with Rafael Advanced Defense Systems. These plans involve the potential manufacture of systems and components for air defence systems for Germany and Europe.
While Rafael would contribute its technological expertise and long-standing experience in the field of modern air defence systems, the workforce in Osnabrück would play a central role in establishing manufacturing operations and industrialising production. The cooperation is also intended to pave the way for further partnerships and projects under the umbrella of the new company.
Volkswagen decided in 2024 to phase out vehicle production at the Osnabrück site in summer 2027. The company will support the transition to the new corporate structure and contribute its industrial experience, expertise in development and industrialization, as well as the existing infrastructure, to the further process.
Oliver Blume, CEO of the Volkswagen Group said: “Volkswagen stands by its responsibility for Osnabrück. With today’s agreement, we are taking an important step towards opening up a new industrial future for the site. Time and again, the employees in Osnabrück have demonstrated just how much expertise, flexibility and commitment this plant has to offer. The site can build on these strengths in the future as well.”
Olaf Lies, Minister-President of the State of Lower Saxony highlighted the importance of the skilled workforce and the broader context of changed defence needs in Europe: “With this agreement, we are unlocking a genuine industrial opportunity for Osnabrück. The site boasts a highly-skilled workforce, well-established structures, and extensive experience in handling demanding tasks. At the same time, there has been a fundamental change in our security situation and our need for protection. Germany and Europe must strengthen their capabilities and become more independent. Lower Saxony wants to help ensure that this creates value and secure employment. Osnabrück can play an important role in this context.”
Daniela Cavallo, Chairwoman of the General and Group Works Councils of Volkswagen AG said: “We have reached an important milestone for our colleagues in Osnabrück. More than 1,200 people now have a prospect for their future at their site. The local workforce has worked tirelessly towards this goal over the past two years. It has proven its extensive expertise and made a compelling impact. The result is their success.
“This is where we can see just how important it was that, as employee representatives, we secured a commitment from the Volkswagen Board of Management during collective bargaining negotiations at the end of 2024 to ensure a viable future for the Osnabrück site. Moving beyond the points that have now been agreed, we will continue working on a solution to ultimately ensure that the entire core workforce has a future perspective at the site.”
