German carmaker Volkswagen Group may repurpose its Osnabruck plant for defence use after ending vehicle production in 2027, a spokesperson told Argus, as uncertainty over the outlook for electric vehicle (EV) demand reshapes Germany's auto base.
The phase-out was agreed late last year under Volkswagen's "Future Volkswagen" plan, with the firm now in talks with defence companies to use the Osnabruck site and retain jobs. The firm declined to comment on specific reports but said it may deploy industrial capacity where it supports wider economic needs.
Osnabruck, in northwest Germany, is one of several German sites facing cuts as Volkswagen trims roughly 40pc of domestic capacity by 2028. It currently builds the T-Roc Cabrio, a niche combustion model rather than an electric vehicle, leaving it exposed as the firm pivots its line-up.
But electric vehicle supply has outpaced demand in Europe, leaving some plants underused and forcing closures, production pauses or repurposing. Volkswagen has already ended production at sites such as Dresden and is shifting models across its network to cut costs.
The defence angle points to a deeper shift. EV demand remains policy-led and uneven, while recent moves — such as Volkswagen halting ID.4 production in the US — show how volatile the transition has become.
Redirecting capacity could help address the problems caused by the slower than expected transition to EVs. But it also underlines how Europe's carmakers are starting to hedge beyond passenger vehicles as electrification proves slower, less profitable and more uneven than planned.
