With difficulties piling up from sluggish sales in China, falling productivity, and U.S.-driven tariff measures, the Volkswagen Group, which had said it would cut up to 100,000 jobs, will sell one of its plants in Germany.
According to German media and others, the Volkswagen Group said on the 7th (local time) that it has agreed for Israeli investment firm Aurelius Capital and the state government of Lower Saxony, the group's second-largest shareholder, to acquire its Osnabrück plant and use it as a "security and defense specialist center." Aurelius is reportedly planning a first project at the plant with Rafael Advanced Defense Systems, Israel's state-owned defense company.
Tensions had risen between labor and management after news in July that the Volkswagen Group was considering cutting 100,000 jobs and closing four plants, but the union agreed to the sale plan. The deal includes conditions to keep 1,400 of the 1,800 jobs at the Osnabrück plant through 2029 and to work to safeguard employment for the remaining staff.
Volkswagen assembles the T-Roc Cabriolet at the Osnabrück plant, but in 2024 it agreed with the union to halt car production there next year. The Dresden plant, which was also slated to stop production at the time, has been leased by the Technical University of Dresden to build an artificial intelligence (AI) and robotics research campus.
On the 3rd (local time), the Volkswagen Group's supervisory board unanimously approved the management board's "Future Plan 2030." The plan calls for workforce adjustments of about 50,000 across the group, including managerial positions. The Lower Saxony state government and worker representatives are also participating.