Senator Bob Corker at Volkswagen announcement
photo by Emmett Gienapp
Volkswagen Group of America, Chattanooga Operations, LLC (Volkswagen Chattanooga) and Gestamp, a company that designs, develops and manufactures metal components and assemblies for the automotive sector, announced on Tuesday that their partnership for metal parts stamping in Tennessee will grow and the commitment will lead to more than 500 additional jobs in Chattanooga.
This project will include an expansion of Gestamp’s existing Chattanooga facility and the construction of a new stamping facility in Enterprise South to accommodate stamping of Class A parts including external metals skin for the new mid-size SUV.
Gestamp will invest $180 million in the project that triples its capacity in Chattanooga.
Senator Bob Corker, Governor Bill Haslam, and Economic Development Commissioner Randy Boyd joined Volkswagen and Gestamp officials along with local business leaders for the announcement at the Chattanooga production facility that will build its 500,000th Passat next month.
“The importance of this expanded partnership for Volkswagen and Chattanooga cannot be overstated,” said Christian Koch, president and CEO of Volkswagen Chattanooga. “I am grateful for the hard work of Governor Haslam and Commissioner Boyd, and Senator Corker as well. They all worked tirelessly to make the impossible happen. We have put another crucial pillar into place for our future success and the benefits of this expansion will impact the community for years to come,” Mr. Koch said.
Currently Volkswagen uses press shops in several states to provide all the stamped metal parts for the award-wining Passat built in its Chattanooga facility. This new expanded partnership will allow all of the external sheet metal stamping and a majority of the structural parts to occur at or near Enterprise South, greatly reducing the cost of transportation.
Gestamp Chattanooga will offer for the first time hot stamping technology, in which Gestamp is a global leader. This state-of-the-art process allows the metal to become lighter, but harder, contributing to the reduction of greenhouse gas emissions while improving the occupant’s safety inside the car. Chattanooga’s new hot stamping line will become the 13th of its kind in Gestamp’s US footprint.
“Gestamp was an early believer in Chattanooga in 2009 and now we are taking a remarkable step forward with a macro-project that multiplies our size, adds Class A, introduces hot stamping technology and brings chassis for the first time into our North American operation,” said Francisco J. Riberas, president & CEO of Gestamp.
“Chattanooga is now a key component in Gestamp’s strategic growth roadmap in North America,” Mr. Riberas said. “It began with Volkswagen, with whom we share a strong and enduring bond globally, and has grown to include both government and civic organizations in Tennessee, which engaged with us at the highest levels to make this project possible. We believe this will prove to be a winning combination.”
Volkswagen has agreed to give up 59 acres under its control in a land swap with the city of Chattanooga and Hamilton County governments to provide space adjacent to the factory for the new Gestamp facility. The city and county will provide Volkswagen with land of similar value.
“We are grateful for Gestamp’s ongoing commitment to Tennessee and for the more than 500 new jobs that will be created in Chattanooga,” Governor Bill Haslam said. “The momentum of Tennessee’s automotive sector is strengthened not only when companies locate or expand here, but when they build strong partnerships and support one another. We congratulate Gestamp on today’s announcement and thank the company for bringing us one step closer toward our goal of making Tennessee the No. 1 location in the Southeast for high quality jobs.”
“Today’s announcement is yet another reminder that the Volunteer State is an outstanding place to do business, and I could not be more proud that Gestamp is deepening its commitment to my hometown,” said Senator Corker. “From day one, we knew that if Volkswagen decided to build its mid-size SUV in Chattanooga it would create a jobs multiplier effect that would be felt across our state and region for years to come. I am thrilled for the families in Hamilton County who will benefit from these new jobs, and I applaud Governor Haslam and his economic development team for their tireless work to build on this important partnership, which only further solidifies Tennessee as the premiere location for automobile manufacturing in the nation.”
Senator Corker commented prior to the announcement that these will be well-paying jobs in both line production and management. This development comes as Volkswagen is planning to begin production of a new Cross Blue mid-sized SUV.
Senator Corker said, “This is an exciting announcement. I cannot thank the company enough for making this huge investment and I think more and more is going to happen.”
He also said, “Our state is playing such a major role in the automotive industry. Volkswagen being here has made a tremendous difference in our community, yet today another announcement that will affect 500 families here in Chattanooga in a real way.”
Sen. Lamar Alexanderreleased the following statement:
“The expansion of Gestamp’s existing Chattanooga facility is good news for Chattanooga, and just one more example of Tennessee being the ideal place for the automotive industry to make in the United States what they sell in the United States. Today, one-third of Tennessee manufacturing jobs are auto related, and investment in automotive manufacturing is an important part of how our state will continue to attract good-paying jobs.”
“The automotive sector touches nearly every corner of the state with 88 of Tennessee’s 95 counties having automotive operations,” TNECD Commissioner Randy Boyd said. “When Gestamp located in Chattanooga in 2009, it was the company’s first greenfield project in the United States, and it’s great to see that another facility will soon be built in Hamilton County to aid in the company’s growth. I thank Gestamp for creating these new jobs in East Tennessee and look forward to our continued partnership.”
“This is great news for our area as we continue to see tremendous job growth in our automotive sector,” said Senate Speaker Pro Tempore Bo Watson. “I am not surprised. Tennessee, particularly Southeast Tennessee, is a great place to build cars, raise a family, and enjoy the scenic beauty of our community. Who wouldn’t want to do business here?”
“This is proof of the vision we had when Volkswagen came to Hamilton County. We believed other companies like Gestamp would also come to Hamilton County and invest in our community, creating great jobs and at some point expand," said Hamilton County Mayor Jim Coppinger. “That day has now come and we see through this announcement that Gestamp is continuing our relationship by increasing their workforce, creating more great, family wage jobs. We are proud and thankful for Gestamp’s investment in Hamilton County and believe their expansion is a model for other companies to follow.”
"Gestamp's announcement to expand their operation means more good, middle-class jobs for Chattanoogans," said Chattanooga Mayor Andy Berke. “Our area provides a significant advantage for automotive suppliers, and the company’s decision to expand here reinforces Chattanooga's position as a destination for high-quality jobs.”
"We are proud to welcome Gestamp to the Chattanooga and Hamilton County advanced manufacturing automotive sector. Gestamp is a globally diversified engineering company embracing leading technologies and world class practices. We're excited to have the chance to offer our workforce the opportunity to join this organization," said William B. Kilbride, president/CEO of the Chattanooga Area Chamber of Commerce.
House Majority Leader Gerald McCormick said, "I am thrilled with Gestamp's decision to expand their operation in Chattanooga with the construction of a new pressing facility. The addition of over 500 jobs will have a significant impact on our community, and it represents a continuation of the relationship between Volkswagen and the Chattanooga area. I am grateful for the hard work of Governor Haslam, Commissioner Randy Boyd and his economic development team along with the Chattanooga Area Chamber of Commerce at the local level in securing this commitment."