Volkswagen will build its new crossover in Chattanooga, Tennessee.
VW's CrossBlue Concept Image: Volkswagen |
The German-based auto giant has announced it will invest $900m in the plant. However, the location has surprised some observers with its decision to locate production for its new crossover model in the US, rather than at its plant in Puebla, Mexico.
VW was coy about revealing the State incentives offered to influence the decision, although unofficial sources indicate a package worth around $300m
Based on the CrossBlue concept vehicle, the new mid-sized seven-seat crossover should begin production in late 2016 and will be built on the the same vehicle platform as the Passat. The new model is part of VW's strategy to double its US sales by 2018.
The company's CEO, Martin Winterkorn, stated that VW will also open a North American vehicle design and development centre in Chattanooga employing about 200 engineers. Overall, the company will almost double the workforce at the Chattanooga plant which currently employs some 2,500 people.