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Gov. Bill Haslam, R-Tenn., discusses several issues at a Times Free Press editorial board meeting.

Tennessee Gov. Bill Haslam said Friday that some auto suppliers considering moving closer to Volkswagen's Chattanooga plant may balk if the United Auto Workers succeeds in unionizing the factory.

"[VW] wants more suppliers closer to them. We've worked really hard to do that. A lot of those suppliers are saying, 'If the UAW comes into the plant, I don't know if we'll be as close as we would,"' the governor said.

Haslam, speaking to Times Free Press reporters and editors, said business recruitment to the state is being hindered by the UAW's organizing efforts at the plant.

"I've had several folks recently say that if the UAW comes, that would dampen our enthusiasm for Tennessee," he said. "They feel like, 'We're looking at Tennessee because it's a right-to-work state.'"

VW and the UAW said this week they're continuing to talk about a collaborative German-style works council setup. Each said that it will be up to the workers to decide whether they want the labor board and for the UAW to represent them.

The UAW, in a statement on Friday, said if Chattanooga workers choose to have representation and a works council, the union is committed to engaging with VW in "open, fair and respectful dialogue to create an environment where Tennessee workers can participate in VW's global work council system."

According to the union, VW workers in Chattanooga have an opportunity to introduce a new model of labor relations to the United States in partnership with the UAW.

"Such a labor relations model would give workers the job security that would accompany their having an integral role in managing the company and a vehicle to provide input on workplace improvements that will contribute to the company's success," the statement said.

The UAW said every major VW assembly facility in the world, except Chattanooga, has worker representation and a seat on the automaker's global works council.

Haslam said he has talked with VW officials in Chattanooga and in Germany who tell him that the works council under consideration at the local plant should not be "an ultimate concern."

But, he said, state officials have been clear with VW that its works councils and Tennessee's history with the UAW "we feel like are two very different things."

Haslam said people compare the General Motors assembly plant in Spring Hill, Tenn., which already has UAW representation, to Nissan's Smyrna, Tenn., factory that started just before GM built its Middle Tennessee facility.

"They compare the results -- look at what Nissan has grown to and look what GM has done," the governor said. "That's what we hear back from companies."

However, the UAW says the auto companies and their employees represented by the union are prospering.

This summer, GM unveiled a new $167 million infusion into Spring Hill, which coupled with an earlier plan to invest $187 million, could lead to production of a pair of new SUVs. GM also said the investment will create or retain 1,800 jobs at the factory that now employs about 2,000 people.

At the time, Bob King, the UAW president, talked in a telephone interview of "the value of collective bargaining," adding that "there wouldn't be a Spring Hill without the UAW."

"Today it's Spring Hill, but we work just as hard for our members and communities in all of the places where we represent workers," King said.

Nissan, meanwhile, this summer announced it is adding more than 900 manufacturing jobs in Smyrna to support future production of its compact crossover SUV, the Nissan Rogue.

The Smyrna plant, which has fought off multiple UAW efforts, is expected to have more than 7,000 workers by the end of this latest round of hiring.

In addition, Haslam said the state has had conversations with Hyundai, which is reportedly scouting for another assembly plant in the Southeast.

The Birmingham News, citing a South Korea report, said this week that Alabama and Georgia are trying to attract such a Hyundai facility. The automaker already has a plant outside Montgomery, Ala., and its sister company, Kia, operates a factory near West Point, Ga.

Haslam declined to comment further on Hyundai, but he said Tennessee has "pretty good momentum" regarding economic development projects.

"We have several more to come," he said.

The governor did link business recruitment efforts with an initiative the state is undertaking to increase the number of Tennesseans who hold college degree or education certificates.

"As we recruit business, I hear it everywhere -- 'We'd build more and do more in Tennessee if we were confident of the workforce you have,'" Haslam said. "I probably hear that four times a week, and I'm not exaggerating."

Contact Mike Pare at mpare@timesfreepress.com or 423-757-6318.