It seems forever ago now that we reported on a new midsize Volkswagen SUV being confirmed for production at the automaker’s Chattanooga, Tennessee plant in the US. Construction of the plant expansion necessary to make the ute a reality is already underway, but it’s only recently that we learned the estimated boon to Tennessee’s economy that can be expected as a result.
So how much will production of the new Volkswagen SUV put into the state’s economy? Citing a study conducted at the University of Tennessee, MSN reports that the expansion could lead to as much as an additional $370 million annually, and 9,800 jobs across a variety of industries.
The Volkswagen SUV itself is anticipated to require an additional 2,400 employees directly, but the ripple-effect is expected to lead to a demand of many more positions at employers such as “grocery stores, restaurants, shopping malls and construction,” says the study’s author William Fox. Construction of the Chattanooga Plant expansion ought to wrap-up by Summer of 2016, with production planned to start toward the end of that year.
Of course, some measure of incentives were required from the Tennessee government in order to secure the Volkswagen SUV for production there. But the benefits ought to more than outweigh the costs. Said Volkswagen Group of America Executive VP for Public Affairs David Geanacopoulos: “The findings in the CBER study demonstrate that the incentive package recently passed by the Tennessee legislature will result in an economic growth multiplier of several times the state’s investment.
“We would like to thank Gov. Bill Haslam and Economic and Community Development Commissioner Randy Boyd for their leadership in fostering a business environment within Tennessee that is mutually-beneficial for the state and local economy as well as for companies like Volkswagen that have operations in the state.”