After dropped UAW appeal in Chattanooga, VW urged to focus on making, selling cars

After dropped UAW appeal in Chattanooga, VW urged to focus on making, selling cars

April 23rd, 2014 by Mike Pare in Business Around the Region

Volkswagen Chattanooga

After two years of union organizing at Volkswagen's Chattanooga plant, a hard-fought worker vote and a bruising appeal cut short on Monday, the automaker was urged to refocus on assembling and selling cars.

"If you look at VW sales, they're lackluster at the moment," said chief analyst Jesse Toprak. "There has been more talk about organized labor than making cars people want to buy."

Sales at VW are lagging. Through March, Volkswagen of America reported the company sold 10,855 fewer vehicles than the same period a year ago, down 11.1 percent.

The Chattanooga-made Passat's sales are off 6.3 percent, even with increased advertising for its clean-diesel version.

In fact, sales of every major model for the carmaker are down in the U.S. in the first three months of 2014 over a year ago.

Following Monday's announcement that the United Auto Workers is short-circuiting its appeal for a revote at the plant, the German company, its global works council, employees, politicians and even UAW advocates and opponents stress doing what VW does best worldwide -- put people into new cars.

Maury Nicely, an attorney for the anti-UAW local group Southern Momentum, said one constant he saw during the unionizing battle was worker devotion.

"If you talk to the workers, they remain loyal and supportive of VW," he said. "They want to see nothing more than the company to be successful and expand here."

VW employee David Stinnett, a four-year maintenance technician, said in an email that he and wife Angelia "are very proud to be with VW. We wear the logos and we drive VW vehicles. We are a 'company' family and intend to stay with VW until retirement. VW is very good to and for us."

Sean Moss, an assembly quality inspector at the plant, said he believes VW and plant workers can put what's happened over the past couple of years behind them.

"There wasn't any strife on the floor," he said. "Even when the election was on the doorstep, work went pretty much normal."

VW said in a statement that it's time for "all to shape the future of the Chattanooga location."

"Important tasks lie ahead of us: to build excellent cars for the American market in Chattanooga, to create good, secure jobs in Tennessee, and to set up a new, innovative form of co-determination in the USA," the statement said.

A spokesperson for Volkswagen's Global Group Works Council in Wolfsburg, Germany, called on Tennessee's politicians to create conditions that provide the company with the economic basis for safeguarding jobs in Chattanooga in the long term and for creating new ones.

"The UAW has taken the first step and all those responsible in the USA must now look to the future and pull in the same direction," the statement said.

U.S. Sen. Lamar Alexander said after the UAW's decision that employees made their choice in which they voted 712 to 626 against aligning with the union in February.

"The UAW lost the election," he said. "Now the best thing for all concerned is to get back to building cars."

Karl Brauer, a Kelley Blue Book senior analyst, said the company needs to make a decision about where to build a planned sport utility vehicle for the U.S., one for which Chattanooga is said to be the favorite to produce.

"[VW] needed this vehicle six months ago," he said. "They need it as soon as possible."

Brauer said VW also required a resolution to the union situation, even if it's temporary. He said the company can keep fighting for a works council labor board but "it needs to get on with the business of getting the SUV built." Delaying a production decision has cost the company money and market share, Brauer said.

Gary Casteel, who directed the Chattanooga plant organizing campaign for the UAW, called for Gov. Bill Haslam's administration to "extend the incentives that previously were offered to Volkswagen for this new SUV line, and do so unconditionally." State documents leaked earlier this month showed that VW was offered nearly $300 million in financial incentives if it added more than 1,000 jobs in Chattanooga, but the offer was conditioned on any works council "being concluded to the satisfaction of the state of Tennessee."

Haslam has said he would prefer that the United Auto Workers not represent workers at Volkwagen.

Toprak said resolving the union representation question is key because VW doesn't want its employees to turn resentful.

"At the end of the day, it's they -- your people -- who make your cars," he said.

Contact Mike Pare at or 423-757-6318.