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Volkswagen to Boost Expansion of Chattanooga Plant

Motor Trend logo Motor Trend 4/7/2015 Kelly Pleskot

Volkswagen began expanding its Chattanooga plant this January, and today the automaker won approval to increase the factory's footprint even more.

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Local government authorities approved a plan from Volkswagen to add another 130,153 square feet to enlarge the south end of the plant's body shop. This decision increases the scope of the original expansion by 25 percent.

Although the additional work will cost almost $18 million, the company says the move will save money in the long run. VW officials, speaking with the Chattanooga Times Free Press, said it will give the company greater flexibility in assembling vehicles. The automaker is paying the entire bill for the latest part of the expansion, according to the report.

Volkswagen to Boost Expansion of Chattanooga Plant Volkswagen Cross Coupe GTE Concept Front Side View Posing© Provided by MotorTrend Volkswagen Cross Coupe GTE Concept Front Side View Posing

Volkswagen will introduce a number of new models in the coming years, which should make good use of the extra space and at least 2,000 additional workers. A revised Passat is headed down the pipeline from the Chattanooga plant, and by the end of next year, Volkswagen will start production on a seven-seat crossover there. Hopefully these new products will help boost VW brand sales, which saw sales drop 10 percent last year and remained down at the beginning of this year.

But Volkswagen isn't pouring money on just its Chattanooga, Tenn. plant. Its facility in Puebla, Mexico is preparing to start production on a three-row Tiguan at the end of 2016. This expansion will cost VW a cool $1 billion for extra production lines and tooling for auto parts.

Source: Chattanooga Times Free Press 1, 2

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