Vw opens Chattanooga plant

Article by Christian Andrei, on May 26, 2011

The new $1-billion factory of Volkswagen AG in Chattanooga, Tennessee, that recently opened promises to increase sales in the United States as demand for vehicle continues to improve after having had its sales drop to a 27-year low in 2009.

In July 2008, which is several months before the crash of the U.S. economy, the company announced that it plans to build the Chattanooga plant, which will produce the Passat midsize sedan.

Chief Executive Officer Martin Winterkorn has previously stated that he intends to increase the company's annual U.S. sales by 2018 to 1 million units, including Audi.

The company disclosed that the United Auto Workers union will possibly try to organize the employees there. Bob King, president of UAW, stated that he intends to create at least one non-union auto plant in the U.S. this year.

He added that preliminary talks have started but has declined to identify the companies that may be targeted.

On another note, the Ann Arbor, Michigan-based Center for Automotive Research has revealed that vehicle manufacturers have announced at least $17 billion investments in plant expansions for Canada and the U.S. since 2010 began, including the General Motors Co.’s $2 billion investment this month.

Based on the average estimate of 18 analysts that Bloomberg surveyed, total light truck and car sales may increase to 13 million this year. Sales for light vehicle in 2010 reached 11.6 million.

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