Volkswagen's revived plan to produce military equipment at its Osnabruck factory with Israel's Rafael has drawn fresh opposition after reports that the state of Lower Saxony could step in to help overcome objections that had stalled the project.
The proposal comes as Volkswagen undergoes a sweeping restructuring amid falling profits, weaker demand in China and growing competition from lower-priced Chinese brands in Europe, with vehicle production at the Osnabruck plant set to end after 2027.
Thorben Peters, co-chair of the Left Party in Lower Saxony, said thousands of jobs at the factory, along with its industrial expertise and know-how, must be preserved without a shift to arms production.
"Replacing civilian production with military production cannot be the answer to the automotive industry's current crisis," Peters told Anadolu.
"The state of Lower Saxony, in particular, should not use public funds to participate in an arms-related joint venture. We reject the false claim that the only alternatives are unemployment or arms production."
Volkswagen confirmed in March that it was in talks with several defence contractors about the Osnabruck plant.
A blocked plan and a new workaround
The proposal has faced opposition from peace groups, labour movements and opposition parties for months, particularly over potential cooperation with Israel's state-owned defence firm Rafael.
In July, Qatar's sovereign wealth fund, Volkswagen's third-largest shareholder, blocked the plan.
Now, management has revived the idea with a structure that could overcome that obstacle.
According to recent German media reports, Volkswagen would transfer parts of the Osnabruck site to the state of Lower Saxony, which could then form a joint venture with Rafael to manufacture military equipment.
The project could manufacture key components for Israel's Iron Dome air defence system, including launchers, transport vehicles and power generators.
The Hannoversche Allgemeine Zeitung reported that Lower Saxony could invest at least €200 million ($232 million) in the project.
The Left Party argues that if the state is prepared to spend public money to preserve production and jobs at the site, it should instead invest in civilian alternatives.
Peters said those could include special-purpose and environmentally friendly vehicles for public transport.
Volkswagen's supervisory board is due to meet on September 4.
Peters said his party opposes converting civilian industrial capacity to military production as a matter of principle, regardless of the nationality of the company involved.
In the case of Israeli defence company Rafael, however, he said the war in Gaza raises additional concerns.
"Given the massive human rights violations and serious allegations regarding breaches of international law in connection with the war in Gaza, there must be particularly rigorous scrutiny,” he said.
"The guiding principle for public investment must be that human rights and international law are non-negotiable."
'City of Peace' pushes back
The debate has particular resonance in Osnabruck, a city that has long promoted itself as a "City of Peace" because of its role in the negotiations that led to the Peace of Westphalia in 1648, ending the Thirty Years' War.
The prospect of military production at the Volkswagen plant has sparked repeated protests in recent months, bringing peace activists, anti-war groups and local initiatives onto the streets.
The Osnabruck Peace Initiative argues that Lower Saxony should use any public money earmarked for the plant to support a socially responsible and environmentally sustainable transition rather than subsidise weapons production.
"Production for an Israeli arms company amounts to de facto support for the wars the state of Israel is waging against the Palestinians, Lebanon and Iran," Marie Dominique Guyard, spokesperson for the initiative, told Anadolu.
"Defence equipment for the Iron Dome plays a role in Israel's aggressive, offensive military activities, as it provides the protective shield enabling Israel to act aggressively toward its neighbours."
Speaking on behalf of the Osnabruck Peace Initiative, Guyard said the group's position is also informed by international legal proceedings concerning Israel's conduct.
She pointed to a 2024 International Court of Justice advisory opinion that found Israel's continued presence in the Occupied Palestinian Territory unlawful and said states must not provide aid or assistance in maintaining the situation created by that presence.
She cited International Criminal Court arrest warrants for Israeli Prime Minister Benjamin Netanyahu and former Defence Minister Yoav Gallant on war crimes and findings by a UN commission of inquiry and Amnesty International accusing Israel of genocide in Gaza.
But she also pointed to Osnabruck's own history to explain the depth of local opposition.
The city was repeatedly bombed during World War II, when it was home to arms-related industry. About 65 percent of Osnabruck was destroyed, including 95 percent of its historic old town.
For Guyard, the prospect of military production returning to the city some eight decades later makes the debate about more than the future of one Volkswagen factory.
"When arms factories are once again established in the city some 80 years after the last war, one can only despair at the decision-makers' disregard for history," she said.
“We do not wish to support such a disastrous development and will continue to build opposition to ensure that work in the city serves peace rather than war.”
