2nd Volkswagen plant could come to Chattanooga, report says

Volkswagen is looking at building a second plant in the United States, and it could sit next to its existing Chattanooga factory, a report from Germany said Thursday.

Manager Magazin, citing unnamed sources, said the production capacity in the U.S. could more than double to 600,000 vehicles annually.

The report appears to align with remarks last month that future assembly of VW's ID.Buzz, an electric version of its iconic Microbus, could eventually come to the Chattanooga plant. VW also has said it's studying production of an electric pickup truck for North America and that other EVs are expected to arrive in the region after 2026.

Scott Keogh, Volkswagen Group of America's chief executive, said in March that he recently returned from the Chattanooga plant and a visit with Tennessee Gov. Bill Lee and Chattanooga Mayor Tim Kelly.

"We had good meetings with Lee, the team in Nashville and the mayor," he said in a virtual meeting with journalists. "It's a great plant and has a great future."

Keogh said the new version of the Microbus will be built in Hanover, Germany, yet he foresees demand outstripping that plant's ability to meet the need.

While importing the ID.Buzz to the U.S. from Germany is the plan in 2024, he said, VW "might need to adjust accordingly."

He said Chattanooga already has the company's electric-vehicle platform on which the ID.4 battery-powered SUV is slated for production in the city late this summer.

"We have that platform in Chattanooga," Keogh said. "Let's see how it goes."

The plant has undergone an $800 million expansion for assembly of the ID.4, which will be produced alongside the existing Atlas SUV and Atlas Cross Sport SUV.

To handle future assembly at the Enterprise South industrial park facility, the company has begun efforts to bring on nearly 1,000 new workers in the biggest hiring push since the factory opened more than 10 years ago.

The company plans to add a third shift and employ about 4,500 in Chattanooga, said Burkhard Ulrich, the plant's senior vice president of human resources, in an interview this month.

VW became the No. 2 seller of EVs in the United States last year with its ID.4, which is now imported from Germany, and other electric vehicles, trailing leader Tesla, according to the company.

Keogh said ID.4 production capacity in Chattanooga is expected to be from 100,000 to 120,000 units per year. That figure, coupled with existing demand for the Atlas and Atlas Cross Sport, would maximize the Chattanooga plant, the VW official said.

But he said the company is overwhelmed with demand for the ID.4.

"The market is going through the roof," Keogh said.

In terms of a potential future battery plant in the U.S, Keogh said the company will need the units. Currently, VW plans to source batteries from a new $2.6 billion factory that South Korea's SK Innovation is building near Commerce, Georgia.

Keogh said whether a battery plant could go in Chattanooga is to be determined.

"We want the plant to be close to where we're building [vehicles]," he said.

Contact Mike Pare at mpare@timesfreepress.com or 423-757-6318. Follow him on Twitter @MikePareTFP.