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Chattanooga: Volkswagen gets down to details in plant deal

By: Mike Pare
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By: Andy Sher
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Ed McCallum

Just weeks before the possible announcement of a new assembly plant that could land in Chattanooga, Volkswagen officials should be 99 percent done with their search efforts, an auto consultant said Monday.

“Now it’s dealing with the details,” said Jim Bruce, president of Atlanta-based Bruce Facility Planning Consultants.

Volkswagen officials already should have done the due diligence that shows a potential site will work well for an assembly plant, said Mr. Bruce, who helped bring a Toyota Motor Corp. plant to Georgetown, Ky.

Now, he said, it’s a time of getting into intangibles such as quality of life and the sense of the community where the company will place a plant, as well as expanding personal relationships.

“They’re going to be working with (community officials) for 30 years,” Mr. Bruce said, adding he is not working with the German automaker on its project.

Ed McCallum, site consultant with McCallum Sweeney of Greenville, S.C., said Volkswagen officials probably are talking with suppliers and focusing on work force development.

“Ultimately, workers make the cars,” he said. “How do you bring them up to speed, and how do you make sure that gets done quickly and there is a world-class work force?”

Mr. McCallum, who also isn’t involved in the Volkswagen effort, said the automaker likely is talking to communities about getting permits in a timely manner, as well as what can be done to assist families that may be moving from Germany.

“A move is stressful in any family, particularly if you’re going to a new country,” he said.

Jill Bretina, a Volkswagen spokeswoman, said factors that are important to the company are readiness of a site, cost and logistical issues.

“Other than that, we’re not commenting on the process,” she said.

The company has said it is looking at sites in Tennessee, Alabama and Michigan for a new $1 billion auto assembly plant that ultimately could employ 2,000 people.

Chattanooga’s Enterprise South industrial park is believed to be a candidate for the plant, which could begin production in 2010 or 2011. For the past month, work has been under way to clear and grade parts of the 1,600-acre location in Tyner.

Volkswagen representatives have visited the site and been in and out of Chattanooga over the past couple of months.

Mr. Bruce said the real objective of a site consultant is to bring the search down to two or three locations, all of which could work for the company. He said he has seen projects not go to the No. 1-ranked site, but that’s understandable.

“There are going to be things a company can’t put down in advance as a requirement. It may be something they looked at in the community,” Mr. Bruce said.

One client picked a location because it looked more noble than another, he said.

“It had a nice vista. Just standing on the site, it was prettier than the other candidates,” Mr. Bruce said.

INCENTIVE PACKAGES

While economic and financial incentives are discussed early in the process, those talks may continue right up to the day a company makes an announcement, Mr. McCallum said.

“It’s never over until it’s over,” he said.

Gov. Phil Bredesen on Monday told the Nashville Rotary Club that the state in recent years has made “substantive changes” in its incentive package.

“I don’t think we should ever be the best dollar (offer) on these things, but we’ve gotten to the point now where we’re competitive ... We get people to talk to us,” he said.

Gov. Bredesen said state Economic and Community Development Commissioner Matt Kisber also is focused on studying ways to get companies here.

The governor noted that, when the state was working in 2005 to persuade Nissan Motor Co. to relocate its corporate headquarters from California to Franklin, Tenn., just south of Nashville, state officials discovered the wife of company Chief Executive Officer Carlos Ghosn was a huge collector of African violet plants.

“We happened to have in Nashville a (major) grower of African violets .... We got them to name an African violet after his wife so she could go into any Wal-Mart or Target in the United States and buy an African violet named after her,” he said.

That’s an example of the state “trying to find some way to distinguish yourself,” the governor said.

In terms of quality of life, Chattanooga is “a jewel,” Mr. McCallum said.

“My hat’s off to the leadership if they pull this off,” he said.

But, said the consultant, the Huntsville-Decatur, Ala., area, also thought to be a finalist, is “real nice” as well.

The governor said Hamilton County officials “have done a very good job” working on the site at Enterprise South.

“They have gone ahead and taken care ... and have a site that’s really ready to go,” he said. “And whether they get the current prospects that they’re working on or the next one that comes along the line, I have no doubt there’s going to be a major, major manufacturer at the site.”

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