Factory on 'fast track,' VW says

The carmaker's $40 million training center to open next week

Volkswagen's Chattanooga plant is on "the fast track" to start production at the start of next year, VW Group of America's chief executive said Thursday.

"The midsize sedan and the Chattanooga plant are an important part of our strategy for the U.S.," said CEO Stefan Jacoby at the Tennessee Valley Corridor Summit in Washington, D.C.

Next Friday, Mr. Jacoby said, VW will mark the opening of its $40 million training center at Enterprise South industrial park.

Mr. Jacoby said VW plans to spend $230 million in "construction projects" locally over the next 20 years.

Guenther Scherelis, general manager of communication for VW in Chattanooga, said new models made at the city's production plant will require upgraded equipment and processes and, therefore, need new investment.

Mr. Scherelis said the German automaker is a little ahead of schedule on some parts of the $1 billion plant's construction.

"All of it is completely on track," he said, adding the project is designed to go up "very fast."

Car company officials have said they want to triple U.S. sales to 800,000 units by 2018. The plant is to make 150,000 vehicles annually with a new midsize sedan aimed at the American market.

BY THE NUMBERS* $686 million -- Value of contracts awarded to companies within 150 miles of Chattanooga* $230 million -- Value of construction projects VW plans in the next 20 years to upgrade its local facilities* 50 -- Percentage of contracts for building VW's Chattanooga supplier park which have gone to companies in the region.Source: Volkswagen

This summer, Mr. Jacoby said, VW plans to unveil in New York its new compact sedan that will succeed the Jetta. The compact is expected to be made in Mexico.

"You will see the tangible results of our new product strategy in the just a few weeks," Mr. Jacoby said.

While VW plans for up to 30 percent of its new vehicles made in Chattanooga to have so-called "clean diesel" engines, Mr. Jacoby said the automaker also wants to lead the way in hybrids and electric vehicles for the mass market.

Soon, he said, the company will test fleets of electric vehicles in North America, Europe and China.

"By 2018, we expect that 3 percent of our cars will be electric vehicles," Mr. Jacoby said.

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