Volkswagen is set to close a production facility in Germany, marking the first such move in the automaker’s 88-year history. The decision concerns the Transparent Factory in Dresden, where the final vehicle will roll off the production line on Tuesday, the company announced.
The last car produced at the Dresden plant is a red Volkswagen ID.3. Instead of being delivered to a customer, the vehicle will remain on display at the factory and has been signed by all employees. Since its opening, more than 165,500 vehicles have been manufactured at the site.
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From luxury sedan to electric pioneer
The Transparent Factory opened in 2001 and initially became famous for producing the luxury Volkswagen Phaeton. Production of the model ended in 2016. In 2017, the plant entered a new phase with the start of e-Golf assembly, becoming the first Volkswagen site to switch entirely to electric vehicle production.
From 2021 onward, the Dresden facility exclusively manufactured the ID.3, a core model in Volkswagen’s electric strategy. However, shifting market conditions and broader challenges facing the automotive industry have prompted the group to rethink the future of the plant.
Transition toward innovation
Starting in January 2026, Volkswagen will repurpose the Transparent Factory through a strategic partnership with the German state of Saxony and the Technical University of Dresden. The site will be transformed into an innovation hub focused on key technologies, including artificial intelligence, robotics, microelectronics, and chip design.
The Technical University of Dresden plans to use nearly half of the factory’s space for research and development activities. For now, the 230 employees at the plant will retain their jobs in Dresden, at least in the near term.
Volkswagen’s move highlights the deep structural changes reshaping the automotive sector, where traditional manufacturing is increasingly giving way to technology-driven innovation and research-oriented facilities.
Photo: Volkswagen Newsroom
