From tennessean.com
CHATTANOOGA — Volkswagen announced Tuesday that it will build a $1 billion U.S. assembly plant in Chattanooga, ending an eight-month search for a site that finally came down to a competition between Tennessee and Alabama.
Even though several auto industry publications, quoting unidentified sources purportedly inside Volkswagen's headquarters, said in recent days that the plant would go to a site near Huntsville, Ala., the big celebration Tuesday morning took place 100 miles away, on a bluff overlooking the Tennessee River in downtown Chattanooga.
There, Volkswagen's U.S. president and chief executive, Stefan Jacoby, told a crowd of several hundred people gathered at the Hunter Museum for American Art that "Tennessee is just the best fit for us."
Volkswagen, the world's third-largest automaker, will build a plant to assemble a new midsize sedan for the U.S. market, with production planned to begin in early 2011.
The Chattanooga plant will employ up to 2,000 people, Volkswagen said, and production is expected to be about 150,000 cars a year initially.
But with suppliers locating nearby to support the plant, new employment as a direct result of the facility will go well beyond the number Volkswagen will hire, said Tennessee Gov. Phil Bredesen, who shared the stage with Jacoby.
The decision was a major victory for Bredesen's economic-development efforts, led by Matt Kisber, the state's commissioner of economic and community development, and the work of Chattanooga and Hamilton County officials, who began preparing the Enterprise South Industrial Park 12 miles northeast of downtown for such a facility about 15 years ago.
The city and county came close last year to landing the Japanese automaker Toyota, which was looking for a site for a new assembly plant. Chattanooga came in second for that facility, however, which ended up going to a tract near Tupelo, Miss.
Incentives played down
Jacoby said the city's amenities were a deciding factor, more important than any financial guarantees the state made to entice the company to move to Tennessee.
"The incentives were not the key," he said. "We looked at 25 states, and we decided on Tennessee."
There are incentives, though, but Kisber said after the announcement that he wasn't prepared to discuss specifics yet because details had not been worked out with Volkswagen.
Among them, though, are guarantees that the state will support training efforts at the nearby Chattanooga State Technical College for the Volkswagen workers in a way similar to how the state funded $35 million in retraining for General Motors Corp. workers at the Spring Hill plant this year as GM geared up to build a new Chevrolet crossover utility vehicle.
Other incentives include tax rebates and site-preparation work, as well as "making sure the infrastructure is in place at the plant site," Kisber said.
The incentives are "tied to job creation and capital investment," Volkswagen said in its announcement of the plant decision.
Victory for Corker
U.S. Sen. Bob Corker, R-Tenn., who was mayor of Chattanooga when the Enterprise South site was first developed at the location of the former Volunteer Army Ammunition Plant, was on hand for Tuesday's announcement, and played a key role in wooing Volkswagen officials.
"I first heard from them in Washington in November, and we've been working with them ever since to try to persuade them to build their plant in Chattanooga," he said in an interview after the announcement.
Volkswagen officials called him Friday morning to inform him that Chattanooga was going to be recommended to the automaker's supervisory board on Tuesday as the preferred location for the plant, he said.
"I was so overwhelmed that I just choked up," he said. "I represent the entire state, but this is something really close to home for me. It's more than manufacturing; the ripple effect of this will be significant for Chattanooga and all of Tennessee. This is just a huge, huge thing."
Corker's personal efforts to snag Volkswagen included hosting company officials in his Chattanooga home on June 20, which the senator said seemed to be the defining point in the efforts to lure the facility.
"I knew in my heart after the meeting in my home that we had them emotionally," Corker said. "We learned a lot from our dealings with Toyota, and the key to a winning effort is personal relationships."
Also on hand for the Tuesday event was U.S. Sen. Lamar Alexander (R-Tenn.), who also worked with Corker and other state and local officials to lure Volkswagen.
"This puts Tennessee on the road to becoming the nation's dominant auto-manufacturing state," said Alexander, who helped bring General Motors' Saturn division to Spring Hill when he was governor. "This state has gone from nowhere 30 years ago to becoming a major player in the auto industry."
Corker said Chattanooga and Hamilton County's decision in late May to spend $1.8 million to grade the Enterprise South site was instrumental in giving Volkswagen a good look at how a plant would fit into the rolling, wooded topography.
"The topography is one thing that has held us back here," he said. "Middle Tennessee doesn't have those issues. Clearing was the key. They saw they could build a plant at that site, and the intangible became the tangible."
CHATTANOOGA — Volkswagen announced Tuesday that it will build a $1 billion U.S. assembly plant in Chattanooga, ending an eight-month search for a site that finally came down to a competition between Tennessee and Alabama.
Even though several auto industry publications, quoting unidentified sources purportedly inside Volkswagen's headquarters, said in recent days that the plant would go to a site near Huntsville, Ala., the big celebration Tuesday morning took place 100 miles away, on a bluff overlooking the Tennessee River in downtown Chattanooga.
There, Volkswagen's U.S. president and chief executive, Stefan Jacoby, told a crowd of several hundred people gathered at the Hunter Museum for American Art that "Tennessee is just the best fit for us."
Volkswagen, the world's third-largest automaker, will build a plant to assemble a new midsize sedan for the U.S. market, with production planned to begin in early 2011.
The Chattanooga plant will employ up to 2,000 people, Volkswagen said, and production is expected to be about 150,000 cars a year initially.
But with suppliers locating nearby to support the plant, new employment as a direct result of the facility will go well beyond the number Volkswagen will hire, said Tennessee Gov. Phil Bredesen, who shared the stage with Jacoby.
The decision was a major victory for Bredesen's economic-development efforts, led by Matt Kisber, the state's commissioner of economic and community development, and the work of Chattanooga and Hamilton County officials, who began preparing the Enterprise South Industrial Park 12 miles northeast of downtown for such a facility about 15 years ago.
The city and county came close last year to landing the Japanese automaker Toyota, which was looking for a site for a new assembly plant. Chattanooga came in second for that facility, however, which ended up going to a tract near Tupelo, Miss.
Incentives played down
Jacoby said the city's amenities were a deciding factor, more important than any financial guarantees the state made to entice the company to move to Tennessee.
"The incentives were not the key," he said. "We looked at 25 states, and we decided on Tennessee."
There are incentives, though, but Kisber said after the announcement that he wasn't prepared to discuss specifics yet because details had not been worked out with Volkswagen.
Among them, though, are guarantees that the state will support training efforts at the nearby Chattanooga State Technical College for the Volkswagen workers in a way similar to how the state funded $35 million in retraining for General Motors Corp. workers at the Spring Hill plant this year as GM geared up to build a new Chevrolet crossover utility vehicle.
Other incentives include tax rebates and site-preparation work, as well as "making sure the infrastructure is in place at the plant site," Kisber said.
The incentives are "tied to job creation and capital investment," Volkswagen said in its announcement of the plant decision.
Victory for Corker
U.S. Sen. Bob Corker, R-Tenn., who was mayor of Chattanooga when the Enterprise South site was first developed at the location of the former Volunteer Army Ammunition Plant, was on hand for Tuesday's announcement, and played a key role in wooing Volkswagen officials.
"I first heard from them in Washington in November, and we've been working with them ever since to try to persuade them to build their plant in Chattanooga," he said in an interview after the announcement.
Volkswagen officials called him Friday morning to inform him that Chattanooga was going to be recommended to the automaker's supervisory board on Tuesday as the preferred location for the plant, he said.
"I was so overwhelmed that I just choked up," he said. "I represent the entire state, but this is something really close to home for me. It's more than manufacturing; the ripple effect of this will be significant for Chattanooga and all of Tennessee. This is just a huge, huge thing."
Corker's personal efforts to snag Volkswagen included hosting company officials in his Chattanooga home on June 20, which the senator said seemed to be the defining point in the efforts to lure the facility.
"I knew in my heart after the meeting in my home that we had them emotionally," Corker said. "We learned a lot from our dealings with Toyota, and the key to a winning effort is personal relationships."
Also on hand for the Tuesday event was U.S. Sen. Lamar Alexander (R-Tenn.), who also worked with Corker and other state and local officials to lure Volkswagen.
"This puts Tennessee on the road to becoming the nation's dominant auto-manufacturing state," said Alexander, who helped bring General Motors' Saturn division to Spring Hill when he was governor. "This state has gone from nowhere 30 years ago to becoming a major player in the auto industry."
Corker said Chattanooga and Hamilton County's decision in late May to spend $1.8 million to grade the Enterprise South site was instrumental in giving Volkswagen a good look at how a plant would fit into the rolling, wooded topography.
"The topography is one thing that has held us back here," he said. "Middle Tennessee doesn't have those issues. Clearing was the key. They saw they could build a plant at that site, and the intangible became the tangible."
