published Saturday, July 12th, 2014

Buzz over VW's SUV reaches fever pitch

UAW's new local adds to the clamor

This Volkswagen image shows the midsize SUV VW plans to build for the American market.
This Volkswagen image shows the midsize SUV VW plans to build for the American market.
Photo by Contributed Photo /Chattanooga Times Free Press.

The launch of a United Auto Workers local in Chattanooga is turbocharging reports that a production decision on Volkswagen's new sport utility vehicle will come next week.

VW isn't commenting, but workers and media outlets are fueling buzz that the automaker will announce as early as Monday that the vehicle will be assembled at its Chattanooga plant.

The UAW's effort to organize VW's Chattanooga plant played out on the world stage earlier this year. All the while, speculation swirled around the possibility of a new production line and all that would mean for the tri-state area and the rising auto industry in the South.

Meanwhile, auto industry analysts and reporters scoured VW news releases and statements and even other media accounts for anything that might hint at a decision.

Speculation that an announcement was imminent seemed to reach fever pitch Friday, with media outlets straining to be first with the news, even if they didn't have much to go on.

A decision by the German carmaker would cap a long string of stories going back to last year suggesting that VW prefers Chattanooga over Mexico as the site to assemble the SUV, dubbed the CrossBlue.

Earlier this year state officials offered VW nearly $300 million in financial incentives to woo more than 1,000 jobs and hundreds of millions of dollars in new investment linked to the seven-seat vehicle.

But Republican power brokers who oppose any collective bargaining agreement between the UAW and VW were quick to discount any notion that the union's Thursday announcement that it was launching a local in Chattanooga had any influence on the state's discussions with Volkswagen officials.

"The union has not been a part of the discussion at all," Tennessee Gov. Bill Haslam said Friday. "The answer is zero effect."

  • photo
    UAW President Dennis Williams stands with Volkswagen Chattanooga employees as he speaks during a news conference held Thursday at the IBEW Local 175 in Chattanooga to announce the formation of union Local 42 for Volkswagen workers.
    Photo by Doug Strickland.
    enlarge photo

A spokesman for U.S. Sen. Bob Corker, R-Tenn., discounted the UAW announcement Thursday that it would open the non-dues-paying local in Chattanooga with hopes of eventually organizing the Volkswagen plant.

"There has been some confusion about what happened yesterday related to the UAW's announcement that they are opening an office in Chattanooga and its impact on Volkswagen's expansion considerations," said Todd Womack, Corker's chief of staff. "The fact is, nothing happened."

In conjunction with their announcement, though, UAW officials did ask the state to extend economic incentives to VW for the new product line at the plant.

"State officials have assured the public and the Volkswagen workforce that the decision on incentives for Chattanooga is not related to whether workers exercise their right to join a union," said Ray Curry, director of UAW Region 8, in a statement. "We are gratified by those assurances, and the state was right to give them."

Joe Akins, a University of Mississippi professor who follows labor issues, said the UAW's decision to start up the local was a shift in strategy after February's failed vote at the plant.

He said that other U.S. unions have taken similar steps to launch talks with companies without having formal collective bargaining rights, and that organizing efforts can take many years.

Matt Patterson, of the anti-union Center for Worker Freedom, said it appears the UAW will use a similar strategy in Vance, Ala., where it's trying to unionize a Mercedes plant.

He bemoaned VW's failure to enforce a neutrality agreement signed between the UAW and the automaker before the plant vote. That document says that unless otherwise agreed to by the parties, the UAW shall "discontinue all organizing activities at the Chattanooga plant ... for a period of not less than one year. ..."

Others have said that the holdup in an announcement about the SUV was related to business decisions by the automaker as it tried to get production costs down in Chattanooga and run focus groups to make sure the SUV would be right for buyers.

Staff writer Andy Sher contributed to this report.

Contact staff writer Mike Pare at mpare@timesfreepress.com or 423-757-6318.

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about Mike Pare...

Mike Pare, the deputy Business editor at the Chattanooga Times Free Press, has worked at the paper for 27 years. In addition to editing, Mike also writes Business stories and covers Volkswagen, economic development and manufacturing in Chattanooga and the surrounding area. In the past he also has covered higher education. Mike, a native of Fort Lauderdale, Fla., received a bachelor’s degree in communications from Florida Atlantic University. he worked at the Rome News-Tribune before ...

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