Volkswagen broke ground on its long planned EV factory in Chattanooga, Tennessee this week. The $800 million facility will manufacture electric cars based on the company’s new MEB platform, with the first cars scheduled to roll off the line in 2022. (Yes, we know. Tesla could build a new factory and start production in half the time, but we are going to focus on the good news that VW is putting its shoulder to the wheel to get EV production started in the United States.) The company says the first vehicle built at the new factory will be an SUV model but did not offer any further details.
While the new factory has been planned for almost a year, TechCrunch reports there was a surprise announcement during the groundbreaking ceremonies. Volkswagen says a portion of the new 564,000 square foot factory will be devoted to making battery packs. We don’t know at the moment what company will supply the battery cells for the US-made cars.
“This is a big, big moment for this company,” said Scott Keogh, CEO of Volkswagen Group of America. “Expanding local production sets the foundation for our sustainable growth in the U.S. Electric vehicles are the future of mobility and Volkswagen will build them for millions, not just millionaires. ”
The new factory will add about 1,000 new jobs to the local economy. The company already builds the Atlas SUV and Passat sedan in Chattanooga. Built in 2008, the current factory was the first in the United States to be LEED Platinum certified. In an e-mail to CleanTechnica, Charles Wood, vice president of economic development for the Chattanooga Area Chamber of Commerce, said, “We applaud our friends at VW for their bold move in driving electric vehicle production in Chattanooga. VW’s investment builds on our community’s strength in sustainability, resiliency and innovation.”
Volkswagen is a big part of the local and state economy. A recent report by Ernst & Young found that Volkswagen supports about 16,400 jobs in Tennessee. Those jobs generated $73.8 million in state and local taxes in 2017. Chattanooga has excellent transportation links and a growing pool of experienced workers as well as more than 900 recognized suppliers to the automotive industry. Compared to other manufacturing areas like Silicon Valley, the cost of doing business in the area is lower, as is the cost of housing for employees.
Volkswagen has begun series production of the ID.3 in Zwickau, Germany, is converting two other factories for EVs in Germany, one in the Czech Republic, and two in China. Its claim that it will build electric cars for millions of people seems to be no idle boast.