Volkswagen’s going through should we way, a rather rough time right now. But despite the fact it recently posted the first loss in years after being hit by a diesel emissions cheating scandal, VW isn’t backing down on U.S. expansion plans. The Volkswagen Group has reaffirmed its commitment to expanding its Chattanooga, Tennessee facility, where it plans to build a newly developed midsize SUV for the States.
VW plans to spend $900 million in the production of a newly developed, seven-passenger SUV. In the state of Tennessee alone, Volkswagen Group anticipates a $600 million investment and creation of 2,000 additional jobs. Production of the new midsize SUV is scheduled to begin toward the end of 2016.
“The United States continues to be one of the most important markets for Volkswagen, and our commitment to Chattanooga and the state of Tennessee is clear proof of that,” said Michael Horn, president and CEO, Volkswagen Group of America. “The Chattanooga plant is a core part of our strategy in North America. Here and throughout the region, we will work toward meeting the demands of our U.S. customers and regaining their trust in the Volkswagen brand.”
In addition to investing in a new manufacturing line for the mid-size SUV, Volkswagen has created a new Engineering and Planning Center in Chattanooga. This center will house all future projects for the North American market through a central location, enabling the company to quickly and efficiently implement market-specific changes to vehicles.
“Today, we reaffirm our support of the Chattanooga plant, our employees and the broader community,” said Christian Koch, president and CEO, Volkswagen Chattanooga. “We know we have a lot of hard work ahead of us, but this is a crucial moment in our efforts to deepen our commitment to America.”
Volkswagen has already invested more than U.S. $1 billion in its factory in Tennessee. Currently, more than 2,400 employees work at the plant; this summer, the 500,000th U.S.-built Passat was built.