Herndon, Virginia – The Volkswagen Group of America has announced that it will build a U.S. automotive production facility in Chattanooga, Tennessee, where it will produce a car designed specifically for the North American consumer.

“The U.S. market is an important part of our volume strategy and we are now very resolutely accessing that market,” said Martin Winterkorn, CEO of Volkswagen AG. “Volkswagen will be extremely active there. This plant represents a milestone in Volkswagen’s growth strategy. We will be selling 800,000 Volkswagens in the U.S. by 2018, and this new site will play a key role. This, along with our growth strategy, is a prerequisite for the economic success of the company in the dollar region. We look forward to establishing an important mainstay for ourselves when we become the biggest European carmaker there.”

Initial production capacity for the facility, located 19 km northeast of downtown Chattanooga, is anticipated to be 150,000 vehicles, including a new midsize sedan designed specifically for the North American market. Production is scheduled to begin in early 2011. The plant is expected to bring about 2,000 jobs to the area, pulling from the labour force of Tennessee as well as Georgia and Alabama.