The Chattanooga Area Chamber of Commerce's purpose is to build a thriving Chattanooga. In 2008, we worked alongside our partners at the city and county to recruit Volkswagen to Chattanooga in pursuit of that purpose: creating thousands of well-paying jobs and attracting billions of dollars in investment to Southeast Tennessee during the depths of the Great Recession. Volkswagen unquestionably improved the economic trajectory for its workers and our community, but the pending union vote puts this success at risk.
We believe that workers have every right to vote in a secret ballot election determining if they should be represented by the United Auto Workers (UAW). And we hope that every eligible worker will vote in the election. However, we hope that VW's workers and the community understand the risks that go along with a permanent UAW presence in Chattanooga.
The UAW talks a lot about solidarity — but solidarity with whom? Unionized VW employees cannot be in "solidarity" with their fellow unionized workers at other foreign auto assembly plants in the U.S. for one simple reason: Every time the UAW has entered a foreign automotive assembly plant in the U.S., that plant has eventually closed. Mitsubishi in Illinois; Toyota in California; Mazda in Michigan; and VW in Westmoreland County, Pennsylvania — the last time the UAW made an American Volkswagen plant unprofitable.
History could repeat itself. Today, more than 10,000 families in our community are employed directly by VW or indirectly by VW's local supply chain.
VW-Chattanooga is constantly competing with VW-Mexico for new investment. In February, VW announced a $1 billion investment in Mexico to manufacture electric vehicles, following an investment of more than $700 million in 2022. While we cannot compete on costs, VW-Chattanooga's ability to maintain a flexible and efficient manufacturing operation will be critical for the Chattanooga plant's future economic success.
Does the UAW help create flexible and efficient manufacturing operations?
These concerns are not theoretical. Ford's CEO recently stated that his company will need to review its manufacturing footprint based on the new UAW contract — a telling sign that Ford will consider increasing its manufacturing capacity in Mexico over the U.S. because of the UAW.
We expect to see increased opportunities to grow white-collar engineering and design jobs, but blue-collar jobs are the most at risk. The UAW contract with the Big Three automakers is impacting blue-collar jobs. Less than two months after signing new contracts with the UAW, Ford, GM and Stellantis announced more than 7,000 permanent layoffs in Michigan and Ohio. Additionally, more than 11,000 workers were impacted by temporary layoffs caused by the UAW's Stand-up Strike. While some UAW members received raises, thousands lost their jobs.
Volkswagen has a long legacy of unionization in Germany with IG Metall, the union tied to the automotive industry. But IG Metall does not operate like the UAW. In Germany, unions and their members collaborate with industry to develop apprenticeship programs, education curriculums and take part in management-worker collaboratives known as "works councils," which create positive, coordinated relationships between management and employees. In this way, unions in Germany operate more like the International Brotherhood of Electrical Workers, providing training and apprenticeship opportunities that help create economic opportunity for workers and companies. The UAW is something entirely different. It pits workers against their companies. The UAW's president made this explicit last year when he said the large employers he negotiates with are the "one and only true enemy."
One of the Chattanooga Chamber's guiding principles is collaborative leadership. Collaboration has been a hallmark of Chattanooga's comeback story that has turned a dying city into a thriving region. Collaborative leadership has helped us create an unlikely success story, bridging outdoor recreation and environmental stewardship with advanced manufacturing and innovative entrepreneurship.
The UAW may offer "solidarity" with workers of the world, but does it share Chattanoogans' belief in working together? Without collaborative leadership, we will not be successful in achieving the Chamber's other two guiding principles: increasing economic inclusion and economic mobility — something that VW has done in Chattanooga for 15 years.
The UAW risk is not worth it. We encourage all VW workers to vote in this election, but we hope they will consider these risks before they vote to send their hard-earned membership dues north to Detroit.
Charles Wood is president and CEO of the Chattanooga Area Chamber of Commerce.