Porsche mulls output on continent

Volkswagen's $1 billion Chattanooga plant can assemble 150,000 vehicles a year but capacity could grow to 250,000, according to VW.

photo 2010 VW Site Construction, Courtesy of volkswagengroupamerica.com

While Volkswagen's new Passat is slated for assembly soon in Chattanooga, a report says Porsche's chief executive is mulling North American production.

Porsche, soon to be VW Group's 10th brand, has no plants in North America. If Porsche used VW capacity in the region, that would mean either the Chattanooga or Puebla, Mexico, plants.

A Porsche spokesman said Wednesday the company is looking at expanding production in Germany first, but assembly in North America could occur in the future.

"We're really focusing on Germany and its production capacities. The capacity seems to be there, but import restrictions could lead us to North America," said Tony Fouladpour, a spokesman for Porsche Cars North America.

Matthias Mueller, Porsche's CEO, told the German news magazine Focus that officials this year will discuss whether to start assembly in Asia or North America.

"The main thing is that the car has 'engineered by Porsche' on it. Where it is produced is no longer so important," he said.

Fouladpour said Porsche officials are eyeing VW and other production facilities in Germany to make more vehicles.

"But you never know," he said, adding that producing in North America "is a question for the future."

Mueller said at the North American International Auto Show in Detroit earlier this month the United States is still Porsche's largest and most important market.

Porsche grew sales nearly 29 percent in the U.S. in 2010 to 25,320 units.

In addition to VW's midsize sedan, analysts and observers have mentioned a potential sport utility vehicle could be assembled in Chattanooga in the future.

Jonathan Browning, CEO of VW Group of America, said in an interview leading up to the auto show that VW is only scratching the surface of the SUV market.

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"We don't do as well as we should," he said. "Crossovers and SUVs are one of those opportunity areas."

VW officials have set a goal of nearly tripling U.S. sales to 1 million vehicles by 2018. That's part of the automaker's strategy to dethrone Toyota as the world's No. 1 car company by sales by 2018.

VW's Chattanooga plant is slated to produce 150,000 vehicles a year.

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

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