Revealed Plans of Volkswagen Subsidiaries - Shocking Contemplations Within the Group
In a strategic move to increase its US presence and reduce tariff-related costs, luxury car manufacturer Audi is considering building a new manufacturing plant in Chattanooga, Tennessee, adjacent to Volkswagen's existing facility [1][2][3][5].
The proposed plant would focus on large electric SUVs like the Q8 and could employ 3,000 to 4,000 workers, nearly doubling the current workforce at Volkswagen's Chattanooga site [1]. This move would allow Audi to avoid tariffs imposed on cars imported from Europe and Mexico by producing vehicles locally in the US.
The primary reason for this consideration is the increased US tariffs, which have made importing vehicles from the EU or Mexico significantly more expensive for Audi. Currently, Audi does not operate any production facilities in the US and exports all vehicles from European locations or the factory in Mexico [4].
Audi's CEO Gernot Döllner plans to increase sales in the US to between 300,000 and 400,000 vehicles per year in the long term [2]. The company sold around 200,000 vehicles in the US in 2022 [6]. A plant in Chattanooga could help Audi achieve these sales targets by facilitating access to the US market, while also tapping into existing resources in the region to save time and costs.
The plant would benefit from Volkswagen’s nearby manufacturing infrastructure and supplier network, making supply chains more efficient and cost-effective [1][3]. Audi has been examining various scenarios but has not confirmed any final decision yet [1][2]. The idea of using existing Volkswagen or Scout Motors plants has been dropped in favor of building a dedicated new facility adjacent to Volkswagen’s Chattanooga plant [2][3].
Volkswagen CEO Oliver Blume is relying on negotiations with the US government to strike a deal that would offset new investments by the company with lower tariffs [7]. The potential location is next to the existing VW factory in Chattanooga, where models like the ID.4 are currently produced [4]. The planned plant could have a production capacity of up to 200,000 units [4].
Worldwide, Audi aims to sell up to 2.3 million cars per year [8]. This new plant, if built, would be a significant step towards achieving that goal in the US market.
[1] https://www.autonews.com/automakers-suppliers/audi-eyes-us-plant-chattanooga-tennessee-boost-electric-vehicle-production [2] https://www.autonews.com/automakers-suppliers/audi-considers-us-plant-chattanooga-tennessee-boost-electric-vehicle-production [3] https://www.autonews.com/automakers-suppliers/audi-considers-us-plant-chattanooga-tennessee-boost-electric-vehicle-production [4] https://www.autonews.com/automakers-suppliers/audi-considers-us-plant-chattanooga-tennessee-boost-electric-vehicle-production [5] https://www.autonews.com/automakers-suppliers/audi-eyes-us-plant-chattanooga-tennessee-boost-electric-vehicle-production [6] https://www.cnbc.com/2022/12/28/audi-sales-in-us-decline-in-2022.html [7] https://www.autonews.com/automakers-suppliers/audi-eyes-us-plant-chattanooga-tennessee-boost-electric-vehicle-production [8] https://www.autonews.com/automakers-suppliers/audi-targets-23-million-cars-annual-sales-2025
- Audi's proposed US manufacturing plant in Chattanooga, Tennessee, adjacent to Volkswagen's existing facility, will focus on producing large electric SUVs like the Q8, with a potential to employ around 3,000 to 4,000 workers.
- By producing vehicles locally in the US, Audi aims to avoid high tariffs imposed on cars imported from Europe and Mexico, which have made business operations more expensive.
- This new plant in the US, if built, could help Audi increase its sales in the US market to between 300,000 and 400,000 vehicles per year, as part of its worldwide goal to sell up to 2.3 million cars per year.
