Volkswagen announced this morning that it would build a manufacturing plant in Chattanooga, Tenn. where it will build a vehicle specifically for the North American market. The plant will employ 2,000 workers from the tri-state area and is expected to invest $1 billion in the local economy.The plant is an integral part of Volkswagen's plan for expansion in the N.A. market, with sales expected to crest 800,000 units by 2018. The 1,350-acre site will produce 150,000 vehicles annually – specifically a midsize sedan – in 2011.
Make the jump for the full press release.
PRESS RELEASE
VOLKSWAGEN GROUP OF AMERICA ANNOUNCES IT WILL PRODUCE CARS IN CHATTANOOGA; DECISION MARKS COMPANY'S ONGOING COMMITMENT TO NORTH AMERICAN MARKET
Company will invest $1 billion and bring about 2,000 direct jobs to tri-state area
HERNDON, Va. (July 15, 2008) - Volkswagen Group of America, Inc. announced today that it will build a U.S. automotive production facility in Chattanooga, Tenn., where it will produce a car designed specifically for the North American consumer and invest $1 billion in the economy. The announcement is an important element of the company's overall U.S. strategy of connecting with its customers, increasing its competitiveness and tripling its U.S. customer base in the next decade.
"The U.S. market is an important part of our volume strategy and we are now very resolutely accessing that market," said Prof. Martin Winterkorn, CEO of Volkswagen AG. "Volkswagen will be extremely active there. This plant represents a milestone in Volkswagen's growth strategy. We will be selling 800,000 Volkswagens in the U.S. by 2018, and this new site will play a key role. This, along with our growth strategy, is a prerequisite for the economic success of the company in the dollar region. We look forward to establishing an important mainstay for ourselves when we become the biggest European carmaker there."
"This is a significant step forward in achieving our goals in the U.S. market and a clear sign of the Volkswagen Group's commitment to the North American consumer. Today's decision is a fundamental part of our new strategic direction in the U.S. and our five-pillar strategy," said Stefan Jacoby, President and CEO of Volkswagen Group of America. "Chattanooga is an excellent fit for the Volkswagen culture, having an exceptional quality of life and a long manufacturing tradition."
The company will build the facility in the Enterprise South Industrial Park, located 12 miles northeast of downtown Chattanooga. The 1,350-acre site is 100 percent owned by the city of Chattanooga and Hamilton County and is certified as an industrial megasite by the Tennessee Valley Authority. Enterprise South is adjacent to Interstate 75. Initial production capacity for the facility is anticipated to be 150,000 vehicles, including a new midsize sedan designed specifically for the North American market. Production is scheduled to begin in early 2011.
"I'm enormously pleased by the announcement from Volkswagen Group of America and grateful for the company's investment in Chattanooga and in the people of Tennessee," said Tennessee Gov. Phil Bredesen. "I believe Volkswagen chose Tennessee because of our shared values, our commitment to innovation and our strong respect for the environment. This project will have a significant impact on the economy of Tennessee and the region for decades to come."
"I couldn't be more pleased that the spirit of partnership between the state of Tennessee, Volkswagen and the government and business leadership of Chattanooga and Hamilton County has resulted in this significant investment in Enterprise South," said Matt Kisber, commissioner of the Tennessee Department of Economic and Community Development. "Volkswagen's investment in this community means the hard work and dedication demonstrated by people at the state and local level to create one of the best business climates in the country is paying off."
"We started with a vision of transforming an idle Army facility into the source of thousands of family-wage jobs," said Hamilton County Mayor Claude Ramsey. "Over the last 14 years, I've worked with four different city mayors as well as county commissioners, city councilmen and countless others in overcoming barriers and objections to that plan. Today, we stand with our new friends from Volkswagen to make a historic announcement that will create new opportunities for our community for years to come."
"Volkswagen and Chattanooga have a lot in common," said Chattanooga City Mayor Ron Littlefield. "Both are serious about environmental sustainability and 21st Century manufacturing."
Environmental responsibility is a core value of the Volkswagen Group. The company's focus on sustainable mobility and environmentally responsible manufacturing are right in line with Chattanooga's strong environmental commitment. As an expression of this shared commitment, the state of Tennessee, Volkswagen and Chattanooga-area organizations are partnering to distribute two saplings for every tree displaced by the project. The new trees will be planted by local school children.
According to United States Sen. Bob Corker, who was mayor of Chattanooga when the city and Hamilton County acquired the land and established Enterprise South as an industrial park, the Volkswagen announcement represents a new chapter in Chattanooga's success story. "Through twists and turns, our community has maintained focus, invested wisely and exercised tremendous effort and energy in recruiting a major employer to Enterprise South. The breaking of this final barrier and the realization of the vision to which we have held true will take us to levels we can only begin to imagine," said Corker.
He continued, "Volkswagen is the very best manufacturer and partner we could possibly have in terms of our shared values, and as a result of their enormous investment, not only will Chattanooga be forever changed, but our entire state will reap great benefits from the new suppliers that this facility will attract to the region. I am proud to have been part of a dedicated team that has worked seamlessly on this effort and celebrate this outstanding achievement for our city and our state."
United States Sen. Lamar Alexander praised Volkswagen's decision to locate at Enterprise South, saying, "Volkswagen and Chattanooga, the ideal marriage: one of the world's most admired companies and one of America's most livable cities. This decision keeps Tennessee on the road to becoming the No. 1 state in auto jobs. Congratulations especially to Gov. Bredesen, Sen. Corker and Mayors Ramsey and Littlefield for their leadership," Alexander concluded.
"Over the past seven months, more than 100 Tennesseans at the local, state and federal level have worked odd hours on short deadlines to help us reach this day," said Trevor Hamilton, vice president of economic development for the Chattanooga Area Chamber of Commerce. "From this day forward, we dedicate ourselves to partnering with Volkswagen to move from construction to production as quickly as possible. We will unify our team with Volkwagen's to ensure long-term success for the company, our community and the state of Tennessee."
With the new plant, Volkswagen will bring about 2,000 direct jobs to the area, and will add a significant number of jobs in related sectors. It is expected that these jobs will come from the tri-state area, pulling from the labor force of Tennessee as well as Georgia and Alabama. Volkswagen of America received an attractive, comprehensive package of incentives for the new facility from Gov. Bredesen's office and the Tennessee Department of Economic and Community Development. The statutory incentives are tied to job creation and capital investment. Additional support includes assistance for public infrastructure and job training, each designed to ensure the local economy best leverages Volkswagen's investment to benefit the local work force and ensure the facility's success.
"This area has a deep base of well-trained labor, with excellent engineering and manufacturing programs at the universities and technical colleges," added Jacoby. "Thanks to the visionary leaders and people of Chattanooga, we're confident that the values of this area are compatible with our own, and we envision a long and productive partnership."
Last year, Volkswagen outlined a new strategic direction in the U.S. based on five pillars: product, brand positioning, dealer network, organization and local production. As it moved forward to assess the potential for local production, the company considered many other site options and earlier this year had narrowed its search to Alabama, Michigan and Tennessee.
"We reviewed three excellent sites, all of which had the specific qualities necessary to build a plant in the United States," said Jacoby. "Both Gov. Granholm and Gov. Riley were strong advocates on behalf of their states and the citizens they represent. This was a difficult decision, but we look forward to continuing our relationships with both states. I thank both governors and their staffs."
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Reader Comments (Page 1 of 2)
Avinash machado @ Jul 15th 2008 10:41AM
Poor Detroit. Once the auto capital of the world. Not even one new plant there of late.
jonathan charak @ Jul 15th 2008 10:47AM
they can blame themselves for letting the UAW f*ck them
The Other Bob @ Jul 15th 2008 11:18AM
Michigan has received the last two new GM assembly plants and numerous satmping and other component plants. They aren't in Detroit, but they are about an hours drive away.
The Detroit area has new engine plants and received numerous upgrades to exisiting plants in the last few years, which are essentually new plants.
GM will also be converting the Caddy/Lucerne plant into a small car plant, which will essentually be a new plant under and old shell.
Detroit could use a lot more help, but we still receive much, much more investment annually than the Tenn. plant.
cFoo @ Jul 15th 2008 11:32AM
I don't get it. Foreigners are moving in, while the domestic are moving to Mexico, China or India. How do they even have the balls to ask congress for money?
why not the LS2LS7? @ Jul 15th 2008 11:32AM
I'm sorry, how can Detroit blame themselves for letting the UAW f*ck them?
In this case it is VW, by your thinking VW could open a plant and simply not "let" the UAW f*ck them, right?
No, it's even simpler. Blame the UAW for f*cking any company who sets up shop in or near Michigan.
BlackCanary @ Jul 15th 2008 10:42AM
No sweet home Alabama? Too bad Alabma was starting to look like the new Michigan.
Alabama - MB, Toyota, Honda, Hyundai
Tenn - Nissan and now VW
Georgia - Kia
Mississippi - Toyota
Way to go southern states! SEC must be putting out something other than football players! Those states are starting to kick ass while attracting business and development.
BlackCanary @ Jul 15th 2008 10:49AM
oh and BMW in South Carolina.
Diss @ Jul 15th 2008 10:56AM
Don't forget Tennessee has a GM plant as well...the former Saturn plant in Spring Hill
Big_D @ Jul 15th 2008 11:05AM
Must be the cheap labor. Everything is cyclical my friend. The "SEC" is just a pitstop on the way to Mexico. The cost of living has risin in MI for so long due to inflated wages, that the pay scale became to bloated. It will happen in the "dirty" as well. Once people start making money, the cost of living will rise as a result.
--Ed @ Jul 15th 2008 11:08AM
Add one more...
South Carolina - BMW
Chris H @ Jul 15th 2008 11:24AM
Right to work states vs. union labor states maybe?
RobAFromNC @ Jul 15th 2008 11:37AM
The southern states are getting all the new factories because they are right to work states - no BS from the UAW. There are also plenty of workers that used to work in textiles, furniture, and tobacco. Most of those jobs are in China now...
jmazurak @ Jul 15th 2008 1:16PM
Mississippi's had Nissan since 2003. Also Tennessee has Saturn and don't forget BMW in South Carolina and Toyota in Texas.
Z @ Jul 16th 2008 12:54PM
And they win bowl games against the Big Ten!
Frank the Tank @ Jul 15th 2008 10:49AM
whoo-hoo! As a Chattanooga native I can say that it's about time that a major manufacturer take advantage of the property at Enterprise South. It's an ideal location that has sat vacant for much too long. Welcome VW!
nick @ Jul 15th 2008 10:53AM
FYI, NJ, NY, Conn is the tri state area....
BlackCanary @ Jul 15th 2008 11:12AM
or PA, WV, OH
It depends where your live retard.
Frank @ Jul 15th 2008 1:28PM
Uhh, where I grew up it was PA, NJ, and DE.
KCurtis @ Jul 15th 2008 10:54AM
Pardon me, boys. Is that the Chattanooga choo-choo?
Rocketboy @ Jul 15th 2008 11:04AM
Yes sir..