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VW to Build New $1B Plant in Tennessee
15 July 2008
Volkswagen Group of America, Inc. announced that it will build a US automotive production facility in Chattanooga, Tenn., where it will produce a mid-sized sedan designed specifically for the North American market.
VW plans to sell 800,000 units in the US by 2018, and the new plant will play a key role, according to Prof. Martin Winterkorn, CEO. Volkswagen sold 230,572 total units in the US in 2007. Initial production capacity for the facility is anticipated to be 150,000 vehicles, including the new mid-sized sedan. Production is scheduled to begin in early 2011.
Last year, Volkswagen outlined a new strategic direction in the US 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.
Volkswagen of America received an attractive, comprehensive package of incentives for the new facility from Tennessee Governor 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.
July 15, 2008 in Brief | Permalink | Comments (3) | TrackBack (0)
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Posted by: gr | July 16, 2008 at 06:58 AM
Chattanooga is the best fit for VW. They should have a great workforce that they can develop. Michigan, and now Alabama (with Hyundai and Mercedes), have established manufacturing bases now that are set in their ways - much more difficult to mold into the VW operating system (especially Michigan).
I truly hope that VW produces a dynamite, genuinely relevant vehicle for the US market.
Posted by: ejj | July 16, 2008 at 06:15 PM
>> VW plans to sell 800,000 units in the US by 2018, and the new plant will play a key role, according to Prof. Martin Winterkorn, CEO. Volkswagen sold 230,572 total units in the US in 2007. <<
Considering VW's percieved quality issues (some of which I've personally experienced), and lack of ability to hit the market in the US, doesn't this seem like rediculous estimates?
Posted by: Sasparilla | July 17, 2008 at 09:56 AM
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For positioning Volks-America should consider building their Golf or Jetta PHEVs at this plant. As electrification expands, building new technology cars with domestic labor will reinforce the entire brand. This is a good opportunity for German engineering to lead domestic production.