Chattanooga Mayor Andy Berke, Christian Koch, VW Chattanooga CEO and president, and Hamilton County Mayor Jim Coppinger
Construction is underway at the Volkswagen Chattanooga manufacturing facility in preparation for production of an all new Midsize SUV. The first phase of construction started in early January and will continue for the next two years.
Despite the snow, Volkswagen Chattanooga CEO and President Christian Koch gave a site tour to Chattanooga Mayor Andy Berke and Hamilton County Mayor Jim Coppinger on Tuesday, highlighting the expansion of the production areas in the body shop, paint shop and assembly areas.
“This is a very exciting time in the history of Volkswagen Chattanooga,” said Mr. Koch, CEO and president of Volkswagen Chattanooga, “A lot of hard work is going into adding this second vehicle line to the plant, but it is crucial to our efforts to move forward in America.”
A total of 512,886 square feet will be added to the already existing plant. The assembly, body and paint shops will each undergo a major expansion to accommodate the new SUV line.
“The all-new midsize SUV is a vital component in Volkswagen’s growth strategy for the U.S. market, meeting the demands of the customer and dealer network,” said Michael Horn, president and CEO, Volkswagen Group of America. “We’re thrilled that work has begun on the expansion of our US manufacturing home, Volkswagen Chattanooga, the facility that will be responsible for building the midsize SUV and home of the award winning Passat.”
The body shop will add additional space on the north and south sides of the plant, the assembly shop will expand to the west, and the paint shop will add a complete second automated production line. A new warehouse will also be built at the east side of the plant.
“We’re excited to see the construction under way,” said Hamilton County Mayor Jim Coppinger. “This means jobs and opportunity for construction workers and vendors over the months to come. Ultimately this brings us closer to the day when Volkswagen will be hiring 2,000 workers to produce their new SUV."
“Not only will Volkswagen's expansion create thousands of new jobs, it will strengthen their roots in our city,” said Chattanooga Mayor Andy Berke. “From the construction at the plant to the development of a visitors center, there is no doubt that Volkswagen is invested in Chattanooga,” Berke said.
Soon the National Engineering and Planning Center will take up temporary residency in a building adjacent to the factory, as hiring for the more than 200 engineers is now underway.
Headed by Dr. Matthias Erb, the engineering and planning center will serve as a high-level research and development hub and will house product-related functions such as technical scouting, innovation management, and product management.
Also in the planning stages is the Volkswagen Visitor Center, which will be located 18 miles from the factory in Downtown Chattanooga and is set to open in Summer 2016.
Production of the facelifted Passat is scheduled to start in the summer of 2015. The new Midsize SUV, which was assigned to be built by the Chattanooga plant in the summer of 2014, is scheduled to be in production at the end of 2016.
Akshay Anand, analyst at Kelley Blue Book’s KBB.com, said, “Volkswagen's newest SUV can't come soon enough, so it's good they're preparing appropriate production capacity for the vehicle. If the market is in a similar state next year, the SUV should sell well, as Volkswagen always puts out quality product such as the new Golf. The Tiguan and Touareg could definitely use revisions to keep them relevant in this hot utility vehicle marketplace as well, though each vehicle still has plenty of merits despite their product age.”
Michelle Krebs, senior analyst at AutoTrader.com, said, “This was expected. This vehicle will help Volkswagen some as it has been largely frozen out of the fast-growing utility one. Hopefully a smaller one is not far behind. Volkswagen really needs is a small, competitive utility to battle against the likes of the Honda CR-V.”