Tennessee’s Automotive Industry Is Revved Up and Firing on All Cylinders
Published Aug 25, 2008
Volkswagen Group of America’s Stefan Jacoby, TDECD Commissioner Matt Kisber and Gov. Phil Bredesen cheer VW’s plans to bring auto production to Chattanooga.
Iconic German carmaker Volkswagen is the latest entrant to Tennessee’s thriving automotive industry.
VW’s $1 billion investment at a 1,350-acre site in the Enterprise South Industrial Park in Chattanooga is expected to create 2,000 jobs.
“Chattanooga is an excellent fit for the Volkswagen culture, having an exceptional quality of life and a long manufacturing tradition,” says Stefan Jacoby, president and CEO of Volkswagen Group of America.
VW will build a new sedan targeted at the U.S. market, with initial production expected to be 150,000 vehicles when the plant comes on line in 2011.
“I believe Volkswagen chose Tennessee because of our shared values, our commitment to innovation and our strong respect for the environment,” says Gov. Phil Bredesen.
Volkswagen will join thriving Nissan, General Motors Corp. and Peterbilt Motors Co. plants, as well as 1,000 or so auto-related companies that supply parts to manufacturers across the country.
“The hard work and dedication demonstrated by people at the state and local level to create one of the best business climates in the country is paying off,” says Matt Kisber, Tennessee Department of Economic & Community Development commissioner.
The state’s auto business has expanded to includes headquarter operations, such as Nissan North America, which relocated to Tennessee in 2006.
Tennessee’s central location within a day’s drive of three-quarters of the nation’s population, productive workforce and overall quality of life make the state especially attractive, says David Penn, director of Middle Tennessee State University’s Business and Economic Research Center.
“Not every state is a crossroads, with multiple interstates, in the middle of the country’s population center,” he says.
That makes Tennessee an ideal destination for sophisticated parts suppliers, says Brannan Atkinson, executive director of the Tennessee Automotive Manufacturers Association.
“It used to be that manufacturers kept everything in-house. Now, manufacturers will say ‘We don’t need you just to supply the part, we need you to engineer the part,’” he says.
Resources including Oak Ridge National Laboratory, the University of Tennessee and the Automotive Research Consortium make Tennessee attractive for research-and-development activities. Tennessee’s auto-related operations employ nearly 126,000 people and generate a $6.4 billion payroll. Tennessee ranks fourth in passenger car production, fifth in light-vehicle manufacturing and seventh in light-truck production.
From assembly to parts production to research on future vehicles and alternative fuels, Tennessee’s auto industry is in high gear.
“We can see the complete development of this sector, and Tennessee can play a leadership role in the national discussion of the future of the automotive industry,” Kisber says.
Story by Bill Lewis
Photo by Jeffrey S. Otto
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