Volkswagen’s planned defense deal with Israel blocked by Qatari investors

Volkswagen’s plans for a defense partnership with Israel’s Rafael have been vetoed by the German automaker’s Qatari investors, media reported Friday.

Qatar’s sovereign wealth fund, Volkswagen’s third-largest shareholder, rejected management’s proposal to manufacture missile components and military vehicles at the company’s Osnabruck plant, the Bild newspaper reported.

The move comes after Volkswagen CEO Oliver Blume said in March that the company will stop manufacturing Volkswagen Group vehicles at Osnabruck starting in 2027 and confirmed talks with several defense firms about shifting the plant for military vehicles production. Blume provided no further details at the time.

The proposal has sparked significant controversy within Germany. Volkswagen employees, peace activists and opposition politicians have criticized the plan, arguing the automaker should focus exclusively on civilian production. The Osnabruck Peace Initiative (OFRI) has organized multiple protests in recent months urging Volkswagen to abandon any defense contracts.

Germany’s opposition Left Party called Volkswagen’s planned cooperation with Israel’s state-owned Rafael Advanced Defense Systems “unacceptable,” citing the Netanyahu government’s ongoing military campaigns across the Middle East, accusing it of war crimes and genocide against Palestinians in Gaza.