11/14/2019 | 2 MINUTE READ

Coming Attractions: Electric Vehicle Plants

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Volkswagen will build electric vehicles in Tennessee and Tesla in Germany. Just a normal week in the auto industry.

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Volkswagen ID CROZZ

(Image: Volkswagen)

Volkswagen’s transformation into a highly electric-centric vehicle manufacturer took on more reality yesterday with a few shovels of dirt, as the groundbreaking for an electric vehicle production plant took place in Chattanooga, Tennessee, site of its existing manufacturing plant, where it currently produces the Atlas SUV and the Passat sedan (both of which have gasoline engines, incidentally).

A Big Deal

“This is a big, big moment for the company,” said Scott Keogh, president and CEO of Volkswagen Group of America, speaking of what will become—with start of production in 2022—a 564,000-square foot expansion of its existing body shop.

And for those who are looking at numbers: this is an investment by VW of approximately $800-million and it will add about 1,000 jobs.

Speaking of Numbers

Keogh: “Electric vehicles are the future of mobility and Volkswagen will build them for millions, not just millionaires.”

Volkswagen ID CROZZ

The ID CROZZ will be the first vehicle to be built in the VW Chattanooga facility. (Image: Volkswagen)

What it will be building in the new Chattanooga facility is the ID CROZZ, a compact SUV EV, which will launch in the VW Zwickau plant in Germany, the “mother plant” for VW’s EV activities.

In addition to the vehicle assembly, VW is also planning to build a 198,000-square foot factory for assembling battery packs for the electric vehicles.

A Billionaire Speaks

Speaking of things German and electric, also this week Elon Musk noted “Berlin rocks,” as part of his announcement that Tesla will be building a “Gigafactory” in the German capital.

According to Musk on Twitter, the factory will produce batteries, powertrains and the forthcoming Model Y—an electric crossover utility vehicle.

Seems like that is becoming the form factor of choice for the to-be-launched EV manufacturing facilities.

Throwing Down a Gauntlet?

Germany has a multitude of vehicle manufacturing operations, as well as companies headquartered there like, of course, Volkswagen Group, BMW and Daimler, all of which, in varying degrees (with VW on point), are electrifying their product offerings. So it is somewhat amusing to note that Musk settled on Berlin for his European factory. (Apparently, he was going to place it in the U.K., but Brexit got in the way.)

Global Data data

The growing number of electric vehicle plants around the world. (Source: GlobalData Automotive Intelligence Center)

More Than Music and Bourbon

And it is worth noting that Tennessee is actually strong in automotive, because not only is there the VW Chattanooga complex, but the Nissan Smyrna facility (and North American HQ in Franklin) and the General Motors Spring Hill complex.

According to the Tennessee Department of Economic and Community Development, “Transportation equipment is Tennessee’s top export – accounting for 21.8% of Tennessee’s total exports. In 2018, 4.6 percent of all U.S.-made cars, light trucks and SUVs were produced in Tennessee.”

And presumably, come 2022 those numbers are going to be much higher.

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