The Volkswagen Chattanooga Assembly Plant (or Chattanooga Operations LLC) is an automobile assembly plant in Chattanooga, Tennessee, that began production in April 2011, was formally inaugurated in May 2011, and employs approximately 2,000. The plant has a projected annual production of 150,000 cars beginning with a version of the 2012 Volkswagen Passat NMS, tailored to the US market. Production of the Volkswagen Atlas will commence in 2017.
Rationale
The local plant, building a localized product, will allow the manufacturer to avoid exchange rate fluctuations and closely monitor US automotive market trends, while reducing vulnerability to extended supply chains. Chattanooga Assembly will manufacture 85% of the Passat's content, an unusually high percentage, and about 85% of the content of the North American Passat will come from North American Free Trade Agreement countries. The company has preliminary plans for a second phase 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 other foreign automakers. As of late 2012, cars manufactured at 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. The plant, which operated from 1978â€"88, had been characterized by labor unrest and suffered from poor networking between Westmoreland and Volkswagen headquarters in Germany.
Site
The entire facility includes approximately 1,900,000 square feet (180,000Â m2), and is constructed on a 1,400 acres (6Â km2) parcel of the 6,000-acre (24Â km2) Enterprise South Industrial Park.
The industrial park comprises land that was once an ammunition plant known as the Volunteer Army Ammunitions Plant (VAAP), which manufactured up to 30,000,000 pounds (14,000Â t) of TNT (trinitrotoluene) per month for World War II, the Korean War, and the Vietnam War. The Volkswagen facility is near a remaining storage bunker, once used to store TNT. The site features nearby hiking, biking and walking trails, picnic areas, and overlooks.
Design
Chattanooga Assembly includes a body shop, paint shop, assembly facility, a Market Delivery Options (MDO) building, 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 32,000-square-foot (3,000Â m2) healthcare center with a gym, childcare facilities, and medical services.
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 paint shop is sized to handle a wide range of vehicle sizes. The plant is not designed to manufacture a large vehicle. 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 will be about 31 cars per hour. The plant is organized with its major process areas â€" body shop, main assembly, and paint shop â€" in a stacked configuration with major checkpoints arranged in a concentric-circle layout â€" to eliminate long walks between factory areas, to investigate a problem, for example.
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. In December 2011, the Assembly Plant became the first auto plant in the world to get the LEED platinum certification.
Chattanooga Assembly 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. The Port of Savannah, Georgia's Garden City Terminal will handle imported auto parts in containers for its new plant.
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. 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 work council for consultation and participation rights with management, in order to improve production.
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 party politicians.
However, the United Auto Workers was successful in winning a vote to establish a bargaining unit in 2016.
Overview timeline
- 1988: Volkswagen closes its Westmoreland Assembly Plant
- 2006: Construction completed for the Interstate 75 interchange near Ooltewah, Tennessee.
- July 2008: Volkswagen announces its intention to build the Chattanooga Assembly Plant.
- Fall 2008: Preliminary construction begins.
- January 2009: January Groundbreaking re-scheduled indefinitely.
- May 2009: Ceremonial "Wall-Raising" (vs. groundbreaking).
- October 2010: CSX and Norfolk Southern Railway announced they would again serve the site following the completion of a $6.6 million project to provide dual rail service to the Volkswagen Assembly Plant. The newly completed yard was dedicated on April 6, 2011. Work included "the biggest rail overhaul in and around the Volunteer Army Ammunition Plant since the tracks were laid during World War II."[4]
- April 18, 2011: First Passat rolls off the assembly line.
- April 2011: Completion of the site's $7.5 million 850-foot span steel-and-glass pedestrian bridge and guardhouse.
- May 24, 2011: The plant was inaugurated on May 24, 2011, by Martin Winterkorn, Chairman of the Board of Management of Volkswagen Aktiengesellschaft and the U.S. Secretary of Transportation Ray LaHood with Klaus Scharioth, German Ambassador to the United States, Bill Haslam, Governor of the U.S. State of Tennessee, Jonathan Browning, President and CEO of Volkswagen Group of America, as well as U.S. Senators Robert Corker and Lamar Alexander in attendance. The actor Max Page, who played a small version of Darth Vader in a 2011 Volkswagen television commercial, also attended in costume.
- September 8, 2011: The plant manufactured its 10,000th car, a white Passat TDI. The number included pre-series cars, technical training cars, dealer experience cars as well as customer cars.
- November 2011: The Passat is named the 2012 Motor Trend Car of the Year.
- December 2011: The plant became the first auto plant in the world to receive a LEED platinum certification.
- February 7, 2012: The plant manufactured its 50,000th Passat.
- May 2012: The plant manufactured its 100,000th Passat.
- May 24, 2013: The plant manufactured its 250,000th Passat.
- December 14, 2016: The plant starts series production of the Volkswagen Atlas.
References
External links
- Volkswagen of America's Chattanooga plant page