Volkswagen announced it was coming to Chattanooga 3 years ago today

Volkswagen announced it was coming to Chattanooga 3 years ago today

July 15th, 2011 by Mike Pare in Business Around the Region

Volkswagen officials unveiedl the 2012 Passat, the all-new Chattanooga made midsize sedan, during the first day of the North American International Auto Show in Detroit.

Photo by Dan Henry /Times Free Press.

Volkswagen's top local leaders were talking last week about the pace at which its $1 billion auto assembly plant came together the past three years.

"It's like a symphony orchestra," said Don Jackson, the plant's president of manufacturing, noting people and equipment from far-flung parts of the world worked as one to get the factory up and running.

On July 15, 2008, the German automaker changed the Chattanooga area's economic course when it picked the Scenic City for its first American plant in two decades.

Prior to that day, Chattanooga had little automotive industry presence, but now it's seen as an emerging carmaker hub.

VW officials said they're close to having 2,000 workers, and more hiring is expected. Suppliers in the area are slated to bring in 1,000 more, economic development officials said.

Even before the first all-new Passat made in the plant is sold at a dealership in late September, talk is swirling about more models made at the factory by both VW and premium sister company Audi.

But, VW officials said, first things first.

"So far we've not decided which other model to add and when to do it," said Frank Fischer, VW's chief executive in Chattanooga. "The board wants to watch the ramp up. How are we performing? How is the market receiving our vehicle? Is everything working as predicted?"


In April 2008, Wolfsburg, Germany-based Volkswagen AG said it had narrowed the list of states competing for the potential billion-dollar U.S. production facility to Alabama, Michigan and Tennessee.

At the time, the automaker said it was evaluating whether to build a new plant in the U.S. and would make a final decision that summer.

Chattanooga was marketing Enterprise South industrial park in Tyner to auto companies, having been a finalist for a Toyota plant that eventually went to Tupelo, Miss.

VW officials cited a surging euro as pushing plans for a new production facility. The 15-nation currency had been hitting record highs against the U.S. dollar, making goods exported from Germany more expensive in the U.S.

Over the three months, VW site selectors visited locations in the three states, eventually narrowing the choices to a site near Huntsville, Ala., and Enterprise South.

VW officials even went so far that, on the day of the announcement, they rented facilities in both Huntsville and Chattanooga to keep their selection under wraps.

In a crowded Hunter Museum of American Art, an ebullient group of Chattanoogans listened to VW of America's then-CEO Stefan Jacoby break the news. The Times Free Press issued a special section with the simple headline: "It's Chattanooga."

Despite the Great Recession, VW continued to build the plant as officials said the company would be well positioned in the market when the plant was finished.

Chattanooga Industrial Development Board chief Ted Mills, whose group has overseen the spending of a large portion of the $577.4 million in tax breaks and direct assistance for the VW project, said Thursday he's pleased with the project.

"I hope we get Audi," he added.