Making room for its expanded workforce, Volkswagen is adding about 1,500 parking spaces to its Chattanooga assembly plant.
The work will give the automaker about 4,700 parking slots, officials said Tuesday. The plant currently employs about 3,350 workers.
The city's Industrial Development Board approved awarding a $126,500 engineering contract to Passpointe Engineering to design the lot expansion.
Bill Payne, city engineer, said the total cost of the parking lot work is estimated at $2.3 million, with the state picking up the price tag. He said plans are to finish the lot by the end of the year.
Steve Leach, the city's public works administrator, said plans are to use a 10-acre tract adjacent to the existing lot off Volkswagen Drive. The site had been used as a temporary entrance during construction of the plant, he said.
The money was pledged by the state when VW announced earlier this year it was adding 800 more employees. That would push its Chattanooga workforce to about 3,500.
At the time, state officials said Tennessee extended its memorandum of understanding with VW to provide grants for training of employees and infrastructure investment in the plant. The infrastructure grant to design and pave a parking lot for the new workers was part of the extension.
Frank Fischer, chief executive of VW's Chattanooga operations, said earlier this year VW is making about $7 million in changes inside the plant to bolster the speed of its assembly line so it can make 170,000 vehicles annually, up from the current capacity of 150,000 units a year.