VW Chattanooga begins ID.4 electric vehicle production

Contributed photo by Volkswagen / Volkswagen Chattanooga employees work on an ID.4 as production has begun on the electric SUV at the plant.

Volkswagen Chattanooga on Tuesday started production of its all-electric ID.4 SUV with plans for the first vehicles to be delivered in October, and they can't arrive too soon, according to one dealer.

"It's local, there's high demand for it, and obviously moving with the electric," Brian Johnson, general sales manager at Village Volkswagen of Chattanooga, said in a telephone interview.

The plant is slated to ramp up ID.4 assembly to 7,000 vehicles per month later this year with the goal to further increase production in 2023, the company said in a news release.

Jesse Toprak, chief analyst for the electric vehicle subscription service Autonomy, said Volkswagen has an overall target of reaching 10% market share in the U.S., essentially doubling its current mark.

Toprak said EVs such as the ID.4 and the future Scout-branded electric trucks and SUVs will be catalysts for the automaker.

"VW has struggled to completely break through in terms of growth in the U.S.," he said in a telephone interview. "The ID.4 is crucial."

He added that preorders show that the demand exists for the battery-powered vehicle.

Thomas Schafer, chairman of the global Volkswagen brand, said assembly in Chattanooga is another milestone in VW's electrification strategy for the U.S. and globally.

"We're just starting to write a new chapter for Volkswagen in America, and it is very much an American story," he said in a statement. "When we promised to bring Volkswagen EVs to the millions, it always included American workers building those EVs right there in Chattanooga. We couldn't be prouder to see that vision realized today with our ID.4 electric flagship rolling off the lines."

(READ MORE: VW sold out of ID.4 SUV before assembly starts in Chattanooga)

Volkswagen invested $800 million to ready the factory to produce EVs alongside its Atlas and Atlas Cross Sport SUVs, including a battery pack assembly shop.

The plant also is hiring about 1,200 more employees to meet production levels and go to a third shift, which will put Volkswagen Chattanooga's headcount at more than 5,000.

Chris Glover, the plant's chief executive, said the vehicle is an important one for the facility and the company's EV goals.

"We've been entrusted with the electric vehicle, and we're going to achieve our objectives and goals, and we're going to wave the flag of Chattanooga strongly and forcefully," he said in an interview this month. "We're starting this transformation, which is going to be a journey of probably greater than 10 years eventually. It's our responsibility now to make or break that transformation."

The Chattanooga factory is now the sixth global site to produce vehicles for Volkswagen's electric lineup, according to the German carmaker.

The ID.4 is Volkswagen Group's most popular all-electric model, with 190,000 units made overseas and delivered to customers globally since its launch in 2021, the company said.

Initially, the American-assembled ID.4 will be available in either rear-wheel- or all-wheel-drive 82kWh battery form. In addition, a rear-wheel-drive version with a 62kWh battery will go into production later in 2022 with a lower price. Pricing will be announced soon for the American-assembled ID.4, according to Volkswagen.

The American-assembled ID.4, Volkswagen's electric SUV flagship, will be mainly sourced in the North American region, particularly the U.S., the company said. The vehicle includes materials and components assembled in 11 U.S. states, from steel in Alabama and Ohio to interior parts in Indiana and South Carolina and electronics components in Kentucky and North Carolina. The EV battery will be supplied by SK Innovation, with a plant in Georgia.

(READ MORE: Volkswagen Chattanooga playing in 'Super Bowl' with ID.4 assembly, official says)

As part of the preparation to launch the ID.4, suppliers have invested $2.7 billion throughout the North American continent. More than 3,000 U.S. jobs on the supplier side have been created, according to VW.

"There has been a tremendous effort by thousands of VW Chattanooga employees to bring this vision to life," said Glover in a statement. "I'd like to thank all our highly motivated team members and the extended community of Chattanooga for supporting us as we begin assembly of the ID.4 for the North American market."

(Volkswagen's new battery-powered 'Microbus' will join the Chattanooga-made ID.4 SUV in dealerships)

Contact Mike Pare at [email protected] or 423-757-6318. Follow him on Twitter @MikePareTFP.