VW to speculate $340 million in new 5-seat, Chattanooga-built SUV [photos]

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This story was up to date March 18, 2018, at 11:43 p.m. with extra info.

Gallery: VW will assemble third automobile at Chattanooga manufacturing unit

“Here, Volkswagen is saying we’re not accomplished.”

Chattanooga Mayor Andy Berke on plans by VW to construct a brand new SUV at its Chattanooga plant

Saying a five-seat model of the Atlas SUV suits in one of many hottest-selling components of the U.S. market, Volkswagen pledged Monday to spend $340 million to construct a 3rd automobile in Chattanooga.

“It’s precisely what we have to proceed our progress momentum,” stated Hinrich J. Woebcken, Volkswagen Group of America’s president and chief govt, on the Chattanooga plant.

Production is to start out within the final quarter of 2019, he stated concerning the automobile primarily based off the seven-seat Atlas. The new SUV may have 4 doorways, just like the Atlas, although simply two rows of seats as a substitute of three.

By the numbers

› $340 million: Investment in new Chattanooga SUV

› $2.1 billion: Total Volkswagen funding in Chattanooga

› 22,000: Direct and spin-off jobs generated by Volkswagen, suppliers and others

No name for the new SUV was disclosed, nor the price. A concept of the vehicle will be unveiled next week at the New York International Auto Show as just a rendering of the SUV was shown at the plant.

VW, which now employs nearly 3,500 people in Chattanooga, could hire more workers depending on sales volumes of the new SUV and the other vehicles assembled at the plant, according to the company.

Gov. Bill Haslam cited the new money VW plans to spend, which brings the German automaker’s investment to more than $2.1 billion related to its Chattanooga factory over a decade or so.

“When VW said they were committed to Chattanooga, they meant it,” he said.

Chattanooga Mayor Andy Berke said the automotive sector in the city right now is “a big path” to many people achieving a middle-class standard of living.

Since VW announced it was coming to Chattanooga, estimates are that direct jobs at VW along with supplier and other employment has created upwards of 22,000 posts, he said.

“Here, Volkswagen is saying we’re not done,” Berke told a large roomful of VW employees who turned out for the SUV announcement.

Hamilton County Mayor Jim Coppinger said he thinks the new SUV looks “sporty” and will sell well in the U.S.

“I’m really energized and excited about the future,” he said, adding he’s hopeful that the Chattanooga plant can land future electric vehicle production, as properly.

The addition of the brand new SUV comes as gross sales of the Passat midsize sedan, additionally made in Chattanooga, are falling as patrons flip extra to snatching up sport utility autos and vans off seller tons.

For instance, Passat gross sales within the U.S. within the first two months of the yr are 5,470, down 54.four % from the identical interval final yr, in line with VW.

But, with the Atlas and a redesigned Tiguan SUV, which is made in Mexico, SUVs accounted for 54 % of all VW model gross sales within the U.S. in January and February. Volkswagen of America gross sales total had been up 5.7 % for the primary two months of the yr, figures present.

Woebcken stated there’s further area within the SUV phase to develop much more VW gross sales.

He stated the Atlas SUV that went on sale last spring “symbolizes a turnaround for the brand in the U.S.”

“The Atlas is strictly the sort of automobile American households are on the lookout for,” he stated. “It’s enjoyable to drive, enjoyable to be in.”

Haslam stated there aren’t any state incentives to deliver manufacturing of the brand new SUV to Chattanooga. He stated the sooner incentive bundle that introduced Atlas meeting included a possible offshoot.

“I could not be extra happy that is what they did,” he stated.

Chattanooga’s Volkswagen plant has acquired greater than $800 million in federal, state and native incentives up to now decade, making it probably the most richly awarded enterprise ever in Tennessee and probably the most sponsored amongst U.S. automakers.

U.S. Sen. Bob Corker, R-Tenn., a former Chattanooga mayor who helped negotiate the deal to land Volkswagen in Chattanooga a decade in the past, stated Monday that he’s “thrilled to see Volkswagen realizing its full potential” with its ongoing investments within the their U.S. meeting plant in Chattanooga.

“”Following a collective effort by so many in our group and state to deliver a significant auto producer to Enterprise South, probably the most significant days in my public service profession occurred almost 10 years in the past once I acquired the decision that Volkswagen had chosen Chattanooga,” Corker stated. “And over time, we have now labored hand in hand with Volkswagen management in Germany and our state officers to make sure the corporate would proceed to thrive in our metropolis.”

Charles Wood, the Chattanooga Area Chamber of Commerce’s vice chairman of financial improvement, stated the addition of a 3rd automobile produced on the Enterprise South industrial park plant might over time deliver extra jobs to firms within the space that offer components to VW.

“It depends upon the amount,” he stated.

Contact workers author Mike Pare at [email protected] or 423-757-6318.

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