Chattanooga to Become Home of $1B VW Plant

After considering locales in Alabama and Michigan, Volkswagen Group of America Inc. has just decided to develop its new U.S. manufacturing facility in Chattanooga, Tenn. As the likes of Ford Motor Co. and General Motors Corp. continue to struggle, Volkswagen will shell out $1 billion to complete its new production plant. The 1,350-acre Enterprise South Industrial Park, owned by the City of Chattanooga and Hamilton County, will be the site of the new facility. The park sits just 12 miles from Downtown Chattanooga and is just a stone’s throw from I-75. While specific details of the project have not yet been disclosed, environmental sustainability will be a key factor in its design. From the city to the state level, officials competed fiercely to bring the project to Tennessee, providing a desirable list of incentives, some of which are linked to job creation and capital investment. With completion of the project, Volkswagen will create approximately 2,000 new jobs and spur the creation of additional positions in associated business sectors. The automotive company cited Chattanooga’s coveted quality of life, advantageous infrastructure, well-trained labor pool and admirable engineering and manufacturing programs at local educational institutions as reasons for its decision to build in the city. Volkswagen anticipates commencing production at the new plant in early 2011. Headquartered in Herndon, Va., Volkswagen Group of America is a subsidiary of Wolfsburg, Germany-based Volkswagen AG. As for the product that will be churned out at the new locale, Volkswagen, a division of Wolfsburg, Germany-based Volkswagen AG, is planning a new vehicle that will accommodate growing demand in the U.S. for efficient and affordable cars. “It will be a new mid-size sedan, and it is currently in the design phase,” a Volkswagen spokesperson told CPN today. Despite the nation’s turbulent economy, the company contends that the timing is still right for expansion. “Volkswagen AG has a very aggressive agenda,” the spokesperson said. “One of its top priorities is to increase sales in the U.S. and, as part of the new strategy, be more responsive in the marketplace. Volkswagen, however, is not alone in its bid to expand in an economic climate where other automotive manufacturers are suffering. Munich, Germany-based BMW Group announced in March that it would increase the size of its Spartanburg, S.C. manufacturing campus with the $750 million development of a 1.2 million-square-foot assembly plant. Additionally, Tokyo-based Toyota Motor Corp. is building a $1.3 billion facility in Tupelo, Miss., and Seoul, South Korea-headquartered Kia Motors Corp. is in the midst of constructing a 2.4 million-square-foot manufacturing center with a price tag of $1.2 billion in West Point, Ga . Volkswagen anticipates commencing production at its new plant in early 2011, but first things first. “Now we will begin the hard work of getting into the necessary permitting and construction processes,” the spokesperson said. Blog Comments