Tennessee is Likely Locale for Volkswagen's New EV Factory

Matt Posky
by Matt Posky
tennessee is likely locale for volkswagens new ev factory

Last month, Volkswagen global brand head Herbert Diess said that Chattanooga would be the likely location for the company’s new electric vehicle plant. But he was also careful to specify that VW had made “no formal decision” on the matter.

While it’s always best to wait for the press release to say anything definitive, the automaker has begun posting openings for specialized positions that would relate to its upcoming MEB platform in Tennessee. Perviously, the automaker had only said it intended to build MEB vehicles at its plant in Zwickau, Germany, beginning with the I.D. hatchback model in 2019. It also mentioned it was planning a facility in China while the American site was still under consideration.

Although, with electric vehicles still stuck in a niche market, it might not make sense for VW to establish a new worksite for them. That’s one reason Chattanooga is the likely candidate. Instead of setting up a new facility, the company could expand upon an existing one.

“Chattanooga is highly underutilized [in its current form],” Dave Sullivan, a senior analyst with AutoPacific, told Automotive News. “If VW’s plant can mimic Nissan’s Smyrna plant — building a sedan, crossover and an EV under the same roof — they will be well on their way towards increased capacity utilization.”

Presently, the 3.4-million-square-foot Tennessee plant assembles two models: the Atlas crossover and the Passat sedan. While the Atlas is expected to rake in additional sales as the global crossover craze continues, VW has witnessed Passat volume shrink in North America every year since 2013. Annual sales for the model now represent about half of their post-recession peak and don’t look like they’ll be bouncing back any time soon.

Chattanooga is also the only automobile manufacturing plant in the entire world to receive a top rating in the LEED green building certifications. Receiving a large amount of its electrical power from a nearby solar park and reusing rainwater for cooling and restrooms, the site would make a primo location for VW to continue its green initiative. Building energy-efficient cars at an energy-efficient factory sounds like just the ticket to help the world forget about that pesky diesel emissions scandal from 2015.

While the I.D. hatchback is the first electric model slated to go into production, North America may not see assembly of that particular vehicle. Instead, we’re banking on VW focusing upon larger models — like the Crozz and Microbus — within the United States.

[Image: Volkswagen Group]

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  • Stingray65 Stingray65 on Dec 11, 2017

    All the tax breaks that TN has given VW to build this plant mean that producing a profitable vehicle would normally result in a big loss of taxable revenue, but since EVs don't make a profit they don't lose any revenue. On the other hand, how much capacity will these EVs utilize - since they are such poor sellers and totally dependent on subsidies that might be phased out - maybe not too many green jobs in this announcement.

  • Loopy55 Loopy55 on Dec 11, 2017

    VW intends to make a profit on these cars. They have stated that the MEB platform will allow them to sell EV's at prices comparable to ICE cars without government subsidies.

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