Auto parts companies accounting for about 500 new jobs are starting to roll into Volkswagen's new supplier park, which is seen as vital to the successful launch of the car VW will make in Chattanooga.
"Locating the supplier park on site is a key component of our plans," said Frank Fischer, chief executive of VW's Chattanooga operations.
The $21 million, two-building supplier park next to the German automaker's assembly plant at Enterprise South industrial park is "essentially done," with today as the official move-in date, VW spokesman Scott Wilson said.
Some equipment needed by the half-dozen VW suppliers already is being shipped into the facility.
"They're getting ready to start working with us, producing vehicles," Wilson said.
Jeff Fuller, general manager of supplier Chattanooga Seating Systems, said the company is installing conveyors, information technology systems, office furniture and racks. The company, which will make seats for VW's new car, plans to hire 140 people, he said.
"Our employees and equipment will begin transitioning from our temp site to our suite in the supplier park in mid-August," Fuller said.
The company has been leasing space in Shallowford Business Park East off Highway 153.
Fuller said the company has hired eight production employees and 11 salaried workers so far. Chattanooga Seating is a joint venture of Hollingsworth Logistics, a Michigan minority-owned firm, and Magna Seating, a subsidiary of one of the world's biggest auto parts companies, Magna International.
Howard Tucker of M-Tek Inc., which will supply headliners and door panels for the new VW vehicle, said some equipment has been delivered and installation will start early this month in the supplier park.
Manchester, Tenn.-based M-Tek plans to hire 40 people for its new Chattanooga operation. They'll be starting in November or December, Tucker said.
"We're using our current people to set up," he said.
The supplier park consists of two 223,200-square-foot buildings - or the equivalent of nine football fields of combined space. Having the companies clustered and close by provides economies of scale and convenience, according to VW executives.
Companies Products Number of new jobs
* Chattanooga Seating Seats 140 jobs
* Faurecia (Emcon) Exhaust systems 35 jobs
* Magna Exteriors & Interiors Fascia 25 jobs
* M-Tek Inc. Headliners, door panels 40 jobs
* Thyssen Krupp Axles, corner module 90 jobs
* Wheel supplier To be announced 30 jobs
* Logistics supplier To be announced 140 jobs
The supplier park fits with the carmaker's philosophy of "green city, green plant, green car," Fischer said.
"Being so close to the production process greatly reduces the impact of traditional shipping on the environment," he said.
The supplier park also is a highly efficient way to supply VW's production team with parts when needed, Fischer said.
Supplier company officials have said wages for the new jobs will be "competitive" with area businesses.
In West Point, Ga., where Kia Motors late last year fired up a new assembly plant, one of its biggest suppliers began its workers at $10 an hour plus benefits.
VW is starting its production work force at $14.50 per hour, growing to $19.50 per hour over 36 months.
Fischer said there's space for more suppliers within the park as VW ramps up production, which is to start early next year.
Volkswagen plans to hire more than 2,000 people in Chattanooga at its $1 billion assembly plant. A University of Tennessee study projects that 9,500 more jobs could be created indirectly over time due to the plant.
Initially, engines for the new sedan will be made at VW facilities in Mexico, Germany and Poland, while gearboxes are slated for production in Argentina and Japan, Fischer said.