published Saturday, May 24th, 2014

Auto supplier to pay average wage of $44,500 a year at Chattanooga factory

Calling Volkswagen "a big customer," a French automotive supplier that plans to supply bumpers and fender parts for the Passat sedan also will eye work for a sport utility vehicle that VW wants to assemble for the U.S.

Marc Cornet, Plastic Omnium Auto Exterior's president for the Americas, said in Chattanooga on Friday the company is "targeting everything we can take."

"It's important to be close to our customer," he said about the $65 million factory that will locate in Enterprise South industrial park near VW's Chattanooga assembly plant and supply bumpers and fenders.

The new factory, on which work will start in July and open a year later, will initially employ 184 workers and reach 300 within three years, according to the suburban Paris, France-based company.

The average wage of the jobs will be $44,500 a year, said Patrick Raley, who directs human resources for Plastic Omnium in the U.S.

He said plans are to hire between 10 and 20 people within the next few months and then most of the production crew in the fourth quarter of this year.

The company, which also wants to supply other Tennessee auto plants, will buy 27 acres at Enterprise South for $55,000 per acre, said Charles Wood, the Chattanooga Area Chamber of Commerce's vice president for economic development.

He said Plastic Omnium is expected to seek from the city and Hamilton County a 10-year property tax break to pay only the school portion of the property tax levy for the first decade the factory operates. Similar to other incentive packages offered to new manufacturers, such an agreement would require Plastic Omnium to pay only about 27 percent of the property taxes it would otherwise pay for under the 10-year payment-in-lieu of taxes (PILOT) agreement with the Industrial Development Board of Chattanooga.

VW will swap some of the 1,250 acres on which it has an option at Enterprise South so Plastic Omnium can be nearby.

"It's important to [VW] as well," Wood said.

Christian Koch, chief executive of VW's Chattanooga operations, said it's "very pleased to work with the Chattanooga Area Chamber of Commerce and Plastic Omnium to make available the land that this new facility will occupy."

"We welcome the jobs for the community and another tier one supplier locating close to the factory, which we see as necessary to the continuing success of our operation," Koch said in a statement.

VW has 1,340 acres on which it used part of the parcel to build its factory. The automaker also has an option for about 1,200 more acres.

VW has called Chattanooga the front-runner to produce the new SUV as the local plant vies with the automaker's facilities in Mexico. VW officials have said they're trying to cut the cost of making each of vehicle, and having suppliers close by helps do that.

Ron Harr, the Chamber's chief executive, said the business group has been working with VW from a list of suppliers which it would like to attract to the area.

"VW was the driver," he said, noting Plastic Omnium has a contract with VW on the Passat and that "hopefully, there will be other opportunities in the Southeast."

Hamilton County Mayor Jim Coppinger said Chattanooga can offer a well-trained workforce to Plastic Omnium.

"Chattanooga State and UTC position us to do that," he said.

Chattanooga Mayor Andy Berke said the ultimate result of landing the company is more "good middle-class jobs."

"We are growing our middle class in Chattanooga," he said.

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

about Mike Pare...

Mike Pare, the deputy Business editor at the Chattanooga Times Free Press, has worked at the paper for 27 years. In addition to editing, Mike also writes Business stories and covers Volkswagen, economic development and manufacturing in Chattanooga and the surrounding area. In the past he also has covered higher education. Mike, a native of Fort Lauderdale, Fla., received a bachelor’s degree in communications from Florida Atlantic University. he worked at the Rome News-Tribune before ...

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