East Tennessee lands $1B VW assembly plant
Thursday July 17, 2008
Volkswagen production to begin in 2011
CHATTANOOGA - Volkswagen picked Chattanooga for its U.S. assembly plant that will employ about 2,000 workers and make a new, midsize sedan as part of a plan to triple its U.S. sales by 2018.
Sites in Alabama and Michigan also were considered by Europe's biggest automaker that plans to invest about $1 billion in the plant.
The announcement came on a day that the euro soared to a new high against the dollar and General Motors executives in Detroit announced planned layoffs. It also comes about 20 years after VW closed its last U.S. plant.
Stefan Jacoby, president and CEO of Volkswagen Group of America, received several standing ovations as he told Gov. Phil Bredesen and hundreds of people at a news conference that VW picked Chattanooga for the plant.
Jacoby said the company's selection of Chattanooga is part of a strategy aimed at "connecting more with U.S. customers."
Volkswagen said the new sedan will be designed specifically for the North American consumer.
The company statement said the plant near the Georgia and Alabama borders would create 2,000 direct jobs and "add a significant number of jobs in related sectors."
Parent Volkswagen AG said the company approved up to $991.4 million to build the facility, aiming for a capacity of 150,000 cars a year. It plans to start production in 2011.
VW picked Tennessee 25 years after Nissan Motor Co. became the first foreign automaker in the South at Smyrna, a Nashville suburb.
The 1,350-acre site at Enterprise South Industrial Park near Interstates 75 and 24 between Nashville and Atlanta has long been seeking an auto assembly plant.
Volkswagen executives said the new plant in the United States, in addition to factories in India and Russia, is part of the company's strategy to become the world's No. 2 automaker.
Also, the South offers ample highway and rail connections and hundreds of existing suppliers, but its main attraction is a pool of workers who have shown at other European and Asian assembly plants that they can live without the United Auto Workers union.
Foreign auto assembly plants closest to Chattanooga are Honda in Lincoln, Ala.; the plant Kia Motors Corp. is building at West Point, Ga., and Nissan at Smyrna, all about 100 miles away. Tennessee also is corporate home to Nissan North America, which dedicates a new headquarters July 22 in the Nashville suburb of Franklin.
Source: Knoxville News Sentinel
