The Qatar Investment Authority (QIA) vetoed a deal between Volkswagen and Rafael — an Israeli defense technology company — to utilize one of the auto company’s struggling plants that is at risk of closing, according to Bild, a German newspaper.
In late April, a prospective solution to save Volkswagen’s Osnabrück plant emerged when Volkswagen signed a letter of intent with Rafael to manufacture Iron Dome components for missile defense systems at the facility, with production scheduled to end next year, according to Reuters.
Qatar’s sovereign wealth fund opposed Volkswagen’s deal with Rafael to repurpose the plant, which has around 2,300 employees who are at risk of losing their jobs.
The QIA holds major influence as Volkswagen’s third-largest shareholder, with 10.4% of the total share capital and 17% of Volkswagen’s voting rights, The Jerusalem Post reported.
The QIA vetoed the deal due to the hostility between Israel and Qatar, which would complicate Doha’s position in the Middle East’s conflict. Qatar has extensively supported Palestine and has no diplomatic ties to Israel. Instead, Qatar became a mediator for Israel and Hamas, where Hamas has a political office, according to Reuters.
In an attempt to find a solution, Lower Saxony, a German federal state and major Volkswagen shareholder, could join the collaboration between Volkswagen and Rafael, two sources told Reuters.
Olaf Lies, the State Premier of Lower Saxony and a member of Volkswagen’s supervisory board, declined to comment on QIA’s move but implored the auto company to find a long-term solution for the Osnabrück branch.
“I expect the company to live up to this responsibility and present the announced decisions in a timely manner,” Lies told Reuters. “The state will provide constructive support wherever it is appropriate and possible.”
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