Audi president says Chattanooga is potential site for new plant

Audi president says Chattanooga is potential site for new plant

January 10th, 2012 by Mike Pare in Business Around the Region

One of Audi's two new vehicles, the S4, waits to be unveiled.

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DETROIT -- Audi of America's president said Monday that Chattanooga is "an attractive potential location" for future production of Audis in the United States.

But Johan de Nysschen added that the Volkswagen brand already has aggressive plans for its Chattanooga site.

"We have taken no final decision," he said in an interview at the North American International Auto Show.

Audi CEO Rupert Stadler told Bloomberg last week that the Volkswagen Group's luxury brand will begin producing cars in North America by 2015. Reports have indicated that Mexico is in the mix for a future production plant, as well as the U.S.

Huntsville, Ala., which finished second in the sweepstakes for the VW plant that Chattanooga won, also is reportedly on Audi's radar screen.

Chattanooga Mayor Ron Littlefield said Audi officials have been "in and out" of the Scenic City. But Chattanooga shouldn't lose focus that VW has invested heavily in the city with its new $1 billion plant, he said.

Audi President de Nysschen said Monday that North American production isn't a matter of "if" but of "when."

"We certainly will," he said.

Audi officials said they're looking at which model to produce at a new North American plant. A sports utility vehicle and the A4 sedan are the options, officials told Marketwatch.com.

Audi sold 117,000 vehicles in the U.S. last year, a new high. In fact, de Nysschen said, Audi set new sales records every month last year in the U.S.

"We've got our sights on the 150,000 mark a few short years from now," he said.

At the auto show, Stadler said Audio wants to build on its global sales for 2011, when it sold 1.3 million vehicles.

He said Audi is now No. 2 globally among premium carmakers, trailing only BMW, and is aiming for the 1.5 million sales level.

"We plan to grow faster than the market in all regions," Stadler said.

Volkswagen has an option on about 1,000 acres next to its Chattanooga assembly plant at Enterprise South industrial park, where it started producing all-new Passats last year.

Michelle Krebs, an auto analyst for Edmunds.com, said Audi has a wide array of models, but none with huge volumes.

Whatever model Audi decides to build in the U.S. must make sense from a volume standpoint, she said.

However, Krebs said she doesn't think Audi will produce vehicles in Mexico because that country typically is used to build vehicles that are "cost sensitive," or lower priced.

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