Volkswagen Chattanooga Assembly Plant Explained

Volkswagen Chattanooga
Location:Chattanooga, Tennessee
Industry:Automotive
Products:Automobiles
Employees:3,800[1]
Owner:Volkswagen Group of America

The Volkswagen Chattanooga Assembly Plant (or Chattanooga Operations LLC) is an American automobile assembly plant in Chattanooga, Tennessee. The plant was formally announced in July 2008 and was formally inaugurated in May 2011.[2] [3]

Production began in April 2011 with the model year 2012 Passat B7 (initially called the Passat NMS (New Midsize Sedan)), tailored to the US market, with a projected annual production of 150,000 cars. Passat production ended in December, 2021.[4]

Production of the Volkswagen Atlas commenced in 2017.[5] [6] Production of the electric Volkswagen ID.4 commenced July 26, 2022.[7]

Background

The local plant, building a localized product, allows Volkswagen to avoid exchange rate fluctuations, monitor US automotive market trends,[8] and potentially reduce vulnerability to extended supply chain issues.[9] At its outset, Chattanooga Assembly manufactured 85% of the Passat's content, and about 85% of the content of the North American Passat comes from North American Free Trade Agreement (NAFTA) countries.[10] The company initially had plans for an expansion that would increase capacity to 592,000 vehicles a year. Labor costs at the Tennessee plant, including wages and benefits, have been estimated to average $27 an hour, below those of Ford, GM, Chrysler, and some foreign automakers.[11] As of late 2012, cars manufactured at the Chattanooga Assembly Plant have been exported to Mexico, Canada, South Korea, and the Middle East.The Chattanooga plant opened 23 years after the closing of the Westmoreland Assembly Plant near New Stanton, Pennsylvania, in 1988.[12] The Westmoreland plant, which began operation in 1978, had been characterized by labor unrest and suffered from poor networking between Westmoreland and Volkswagen headquarters in then-West Germany.

Site

The entire facility includes approximately 45acres, and is constructed on a 1400acres parcel of the 6000acres[13] Enterprise South Industrial Park in eastern Chattanooga.

The industrial park comprises land that was once an ammunition plant[14] known as the Volunteer Army Ammunition Plant (VAAP),[15] which manufactured up to 30000000lb of TNT (trinitrotoluene) per month during World War II, the Korean War, and the Vietnam War.[16] The Volkswagen facility is near a remaining storage area containing storage bunkers once used to store TNT. The site features nearby hiking, biking and walking trails, picnic areas, and overlooks, known as the Enterprise South Nature Park.

Models

Design

The Volkswagen Chattanooga Assembly Plant includes a body shop, paint shop, assembly facility, a Market Delivery Options (MDO) building,[18] technical testing center, employee training facility with classrooms, an apprentice-training school and a full-size practice paint booth, a supplier park for eight companies, and a 32000square feet healthcare center with a gym, childcare facilities, and medical services.[19]

The plant has the flexibility to build any of the company's front-engine/front-wheel-drive vehicles in A, B, or C-segments. The rolling-dip paint shop is sized to handle a wide range of vehicle sizes. The plant is not designed to manufacture large vehicles.> The factory includes 383 robots in the body shop, which is approximately 77 percent automated. There are 4,730 weld spots and 292 welding guns. Output is about 31 cars per hour. The plant is organized with its major process areas – body shop, main assembly, and paint shop – in a stacked configuration with major checkpoints arranged in a concentric-circle layout – to eliminate long walks between factory areas, to investigate a problem, for example. The body assembly line uses diode lasers.[20]

VW announced it would seek Leadership in Energy and Environmental Design certification for the complex. In November 2011, VW announced that the 2012 model of the Passat was named the 2012 Motor Trend Car of the Year.[21] In December 2011, the Assembly Plant became the first auto plant in the world to get the LEED platinum certification.[22] A 9.5 megawatt solar park supplies 13 GWh of electricity per year; 12% of plant consumption.[23]

The Volkswagen Chattanooga Assembly Plant was designed by the Nashville engineering and architecture firm SSOE, the firm Environmental Resources Management (ERM) for the environmental permitting process, and Alberici Constructors, Inc. for the construction management of the facility.[24] The Port of Savannah, Georgia's Garden City Terminal handles imported auto parts in containers for the plant.[25]

Cost and incentives

Volkswagen invested approximately one billion U.S. dollars to construct the facility, with local, state, and federal governments subsidizing the project with an estimated $577 million in incentives. Alabama had offered Volkswagen incentives of $385 million, the most the state had ever offered for an auto project. Mississippi offered incentives totaling $294 million to Toyota in 2007 for an assembly plant at Blue Springs. Kia received about $324 million in incentives from Georgia.[26] Volkswagen had researched 398 possible sites before narrowing the choice to the states of Michigan, Alabama, and Tennessee.

Work council and labor unions

The Volkswagen Chattanooga Assembly Plant has attracted international attention after it was proposed that employees elect a union, in order to implement a work council that has co-determination, consultation and participation rights with management.[27] [28]

The United Auto Workers attempted unsuccessfully to unionize the Chattanooga plant in 2014. This was defeated in a 712-626 vote. It was backed by Volkswagen and the IG Metall union in Germany to negotiate with management on day-to-day working matters at the plant. There was, however, considerable opposition from US business groups and Republican politicians.[29] [30] [31]

The UAW again attempted to unionize the plant in June 2019. This failed by a 52 to 48 percent margin.[32] Unlike in 2014, Volkswagen management was not supportive of the union vote.

On 6 February 2024, the UAW announced that over 50% of the 4,100 hourly workers at the plant have signed union membership cards.[33] The VW union drive is happening shortly after UAW's successful strikes in 2023 at the "Big Three" automobile manufacturers Ford, General Motors and Stellantis.[34] On 19 April, the plant's workers voted to unionize. In the historic election, the hourly workers voted 2628 in favor of the union (73%) and 985 against the union (27%).[35]

Overview timeline

Notes and References

  1. Web site: Chattanooga Facts . Volkswagen Group of America . 1 August 2023.
  2. News: Sen. Alexander calls VW, Chattanooga an 'ideal marriage' . Pare . Mike . March 31, 2010. Chattanooga Times Free Press . April 22, 2010.
  3. News: Kisber says VW plant will pay off. Pare. Mike . September 11, 2009 . Chattanooga Times Free Press. April 22, 2010.
  4. Web site: Test Driving the Last Passat: 2022 R-Line . automotorwashington.com . Marco Carvajal . 2022 .
  5. Web site: 2018 Volkswagen Atlas: VW's Three-Row SUV for America Finally Arrives. Steve. Siler. October 27, 2016. Car and Driver.
  6. Web site: First Look: 2018 Volkswagen Atlas . automobilemag.com. Ed . Tahaney . 2020-08-11 . 2016-10-28.
  7. Web site: Volkswagen starts U.S. assembly of all-electric ID.4 flagship in Chattanooga, Tennessee . VW.com . July 26, 2022 .
  8. Web site: Volkswagen sees US plant as key to topping Toyota . Reuters, May 25, 2011, Deepa Seetharaman . dead . https://web.archive.org/web/20110530151123/http://in.news.yahoo.com/volkswagen-sees-us-plant-key-topping-toyota-184721716.html . May 30, 2011 . mdy-all.
  9. News: VW opens Tennessee plant with new focus on quality . LA Times, May 28, 2011, Jerry Hirsch . May 28, 2011.
  10. Web site: Supply Chain Conference: Mexican and intermodal shockwaves . Christopher . Ludwig . 24 May 2016. Automotive Logistics. 13 May 2017. Volkswagen's plant in Chattanooga, for example, currently receives 87% of transport material from the US and Canada, with 6% from Mexico and 7% from overseas..
  11. News: Volkswagen sees U.S. plant as key to unseating Toyota. Chicago Tribune, May 24, 2011, Deepa Seetharaman.
  12. Web site: Volkswagen's Chattanooga Plant Open For Business. The Truth About Cars, Bertel Schmitt, May 25, 2011.
  13. Web site: "The Hidden Jewel" of Enterprise South . News Channel 19, Carl Sneed, December 23, 2008 . dead . https://web.archive.org/web/20110522124310/http://www.newschannel9.com/news/south-974316-enterprise-mention.html . May 22, 2011 .
  14. Web site: VW CEO: Volkswagen delivered on new Chattanooga plant. May 25, 2011. The Times Free Press, Mike Pare, May 25, 2011.
  15. Web site: Industrial prizes fill Chattanooga parks. Rome News-Tribune, Dave Flessner, Chattanooga Times Free Press. dead. https://web.archive.org/web/20110722041424/http://www.romenews-tribune.com/view/full_story/10813777/article-Industrial-prizes-fill-Chattanooga-parks-?instance=lead_story_bullets_left_column. July 22, 2011. mdy-all.
  16. Web site: Volunteer Army Ammunition Plant. Global Security.
  17. Web site: VW to begin ID.4 production in the USA early . June 9, 2022 .
  18. News: Completion of bridge to mark Volkswagen milestone in Chattanooga. Pare. Mike. Chattanooga Times Free Press. March 1, 2011.
  19. Web site: Unique approach to groundbreaking on Volkswagen Drive. WRCBTV.com, September 10, 2010.
  20. Secrets of the Superfactories (TV documentary, 2019)
  21. Web site: Volkswagen Passat Named Motor Trend 2012 Car of the Year . Motor Trend . November 16, 2011.
  22. Web site: Volkswagen Chattanooga Factory Earns LEED Platinum Certification . December 2011 . Chattanoogan.com . December 7, 2011.
  23. News: Hickman . Lizzie . Business Trend: Chattanooga goes solar . Chattanooga Times Free Press. August 1, 2019.
  24. Web site: Volkswagen Selects Engineering & Architecture Firm for Chattanooga Facility. The Dallas News, Associated Press, May 24, 2011, Kristin M. Hall.
  25. Web site: Volkswagen Chattanooga Selects Port of Savannah. Best Shipping News.
  26. Web site: VW Came for the Incentives – And Response. Chicago Tribune August 29, 2008 via Chattanoogan.com, Jan 27, 2009. https://archive.today/20130119080757/http://www.chattanoogan.com/articles/article_143456.asp. dead. 2013-01-19.
  27. News: Scheiber. Noam. 2019-06-15. Volkswagen Factory Workers in Tennessee Reject Union. en-US. The New York Times. 2021-12-05. 0362-4331.
  28. Web site: Slaughter. Jane. Volkswagen Workers Vote on Union, Works Council Scheme. 2021-12-05. Truthout. February 14, 2014 . en-US.
  29. Web site: UAW's Devastating Defeat in Tennessee: Four Blunt Points. www.bloomberg.com . Paul M . Barrett . 2014-02-17. 2020-08-11.
  30. Web site: How Volkswagen's Tennessee Plant Could End Up Organized Without the UAW. https://web.archive.org/web/20140218214025/http://www.businessweek.com/articles/2014-02-18/how-volkswagens-tennessee-plant-could-end-up-organized-without-uaw. dead. February 18, 2014. www.bloomberg.com . 2014-02-18. Justin . Bachman . 2020-08-11.
  31. News: Union Suffers Big Loss at Tennessee VW Plant. Neal E.. Boudette. Wall Street Journal. February 15, 2014. www.wsj.com.
  32. News: Allyn. Bobby. June 15, 2019. Tennessee Workers Reject Union At Volkswagen Plant — Again. NPR. Washington, D.C.. 2019-06-16.
  33. Web site: Hall . Kalea . 6 February 2024 . UAW has signed majority of VW workers at Tennessee plant to join union . 2024-02-06 . . en-US.
  34. News: Sainato . Michael . 2024-01-11 . 'We don't have a say': workers join push to unionize flagship Volkswagen plant . 2024-02-06 . . en-GB . 0261-3077.
  35. Web site: Volkswagen workers in Tennessee pass historic vote to unionize . 19 April 2024 . Whalen . Jeanne . Gurley . Lauren . 19 April 2024.
  36. Web site: From Deseret News archives: Volkswagen building Tennessee assembly plant during hard times. Deseret News, Nov 27, 2008.
  37. Web site: Chattanooga: Making connections for Volkswagen plant site. The Times Free Press, Dave Flessner, July 19, 2008. dead. https://web.archive.org/web/20110724022931/http://www.timesfreepress.com/news/2008/jul/19/chattanooga-making-connections/. July 24, 2011. mdy-all.
  38. News: Pare. Mike. Chattanooga: VW shifts initial work to March. Chattanooga Times Free Press. January 3, 2009.
  39. News: Pare. Mike. Chattanooga: Passing lane in progress. Chattanooga Times Free Press. May 17, 2009.
  40. http://www.chattanoogan.com/articles/article_186301.asp $6.6 Million Project Set To Complete Dual Rail Service For Volkswagen
  41. Web site: VW dedicates rail yard. timesfreepress.com. April 7, 2011 .
  42. News: Marcum. Ed. Chattanooga Volkswagen plant up and running, making fuel-efficient Passat model. Knoxville News Sentinel. May 25, 2011.
  43. Volkswagen Inaugurates New Plant in Chattanooga, Tennessee. Volkswagen. May 24, 2011. July 16, 2011. dead. https://web.archive.org/web/20110729035357/http://media.vw.com/press_releases/inaugurate-chattanooga-plant. July 29, 2011. mdy-all.
  44. Web site: Tiny Darth Vader brings The Force to VW's Chattanooga plant. Autoblog.com, Jonathon Ramesey, May 25, 2011.
  45. News: Pint-sized Darth Vader blesses Volkswagen's U.S. factory. Woodyard. Chris. USA Today. May 24, 2011. 2011-05-24.
  46. Web site: Volkswagen Passat Named Motor Trend 2012 Car of the Year. Motor Trend. November 16, 2011.
  47. Web site: Volkswagen Chattanooga Factory Earns LEED Platinum Certification. December 1, 2011. Chattanoogan.com. December 7, 2011.
  48. Web site: Mihalascu . Dan . VW Celebrates Production of 250,000th Passat at Chattanooga Plant. July 21, 2014. May 25, 2013.
  49. Web site: VOLKSWAGEN CHATTANOOGA STARTS SERIES PRODUCTION OF THE 2018 VOLKSWAGEN ATLAS. Media Site of the Volkswagen of America, Inc.. https://web.archive.org/web/20161217131714/http://media.vw.com/release/1312/. dead. December 17, 2016.
  50. News: Ohnsman. Alan. More Buzz for Dixie: Volkswagen investing $800 million for electric SUV assembly in Tennessee. Forbes. August 22, 2019. January 14, 2019.

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