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Volkswagen AG to Expand its Chattanooga Plant for New Production

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Published on : Apr 08, 2015

The Chattanooga Times Free Press has reported that the German-based Volkswagen AG automotive company has won an approval from the government of Chattanooga panel for an addition of another 130,000 square feet to its US$900 million factory unit expansion. 

The expansion of body shop will be adding about 25 percent more square footage and around US$18 million to the project’s cost estimation according to the Times Free Press.

In order to win a bid for adding space and investment, the company has decided to double the sales of U.S. up to 800,000 vehicles by the end of 2018.  Volkswagen AG has made an announcement in the previous summer that they would be expanding the capacity of Chattanooga plant, which also builds Passat model. The plant will also build a new crossover based on the concept of CrossBlue. The investment is anticipated to add around 2,000 more jobs and the production is believed to start by the end of 2016.

The Engineering and Planning Chief, Matthias Erb, informed the Times Free Press that in addition to the, Volkswagen AG will also open a new North American vehicle design and development center in Chattanooga which will hold a staff of about 200 engineers who will cater its vehicles properly in the North American market. The recruitment process for engineers who will work at the Chattanooga center will start in 2017.

Volkswagen is further trying to change its fortunes in what has been a hot U.S. market. In the previous year, the sales of Volkswagen AG brand’s U.S. went down by 10 percent to 366,970 vehicles whereas the total market rose by around 5.9 percent. In the first quarter of this year, Volkswagen AG sales have recorded a fall of 9.3 percent from the previous year while the total market went up by 5.6 percent.

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