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Volkswagen picks Tennessee for new U.S. plant

July 15, 2008 — Volkswagen Group of America will build an automobile manufacturing facility in Chattanooga, Tennessee, the company announced today. It will be the German automaker's first U.S. plant since it closed a factory in Pennsylvania in 1988.

The plant will be built at the Enterprise South Industrial Park in Chattanooga. Volkswagen will invest about $1 billion in the 1,350-acre site located 12 miles from downtown. The project should create about 2,000 jobs, with production scheduled to begin in early 2011.

The Enterprise South site was certified as an automotive megasite by McCallum Sweeney Consulting. TVA began the megasite certification program in 2004 in response to the need for large industrial properties ready for development.

“We’re very excited that Volkswagen is locating in the Tennessee Valley and has chosen to call Chattanooga, Tennessee, home,” says Tom Kilgore, TVA President and Chief Executive Officer. “TVA and our distributor customers appreciate being part of the economic development team and recognize the extensive efforts made by all parties to recruit this high-profile industry that brings tremendous employment opportunities to our region.”

In building a U.S. plant, Volkswagen is seeking to increase sales and reduce the effect of the dollar's decline against the euro. The company will develop products specifically for the U.S. market, including a new mid-sized sedan that will be priced between the Jetta and the Passat.

"This is an enormous economic development boost for the Tennessee Valley," says John Bradley, TVA's Senior Vice President of Economic Development. "It reinforces the region's position as a leading automotive manufacturing corridor and demonstrates once again that the Valley is a great place to do business."

Volkswagen is the world's fourth-largest carmaker, behind GM, Toyota, and Ford.

Read the Volkswagen announcement about the project.