Volkswagen plans to invest $340 million to build a new five-passenger sport utility vehicle based off its bigger Atlas model at its factory in Chattanooga, Tenn., a bet that American demand for crossovers and SUVs will continue. Like the original seven-seater, the new Atlas variant will be based on the MQB platform and be built at Volkswagen of America's Chattanooga plant.
Volkswagen is adding another vehicle to its local production line.
We'll have the official details live from NY next week. This new five-seater will likely begin being produced next year, and it's the third vehicle to be manufactured at the Chattanooga plant, which is VW's only assembly plant in the United States.
President Donald Trump has complained about the imbalance in tariffs between the US and Germany, calling for "reciprocal" taxes.
VW spokeswoman Jeannine Ginivan said in an email that the move "is not a reaction to the proposed tariffs". The segment long claimed by stalwarts such as the Nissan Murano, Ford Edge, and Hyundai Santa Fe is about to get crowded with the rumored return of the Chevrolet Blazer and this two-row variant of Volkswagen's Atlas. In addition to the two SUV variants, the plant builds the USA -market Passat midsize sedan, employing 2,800 people as of December 2016.
"They needed to fill out that plant for business economic reasons, not for trade reasons", she said.
A concept version of the new model will be shown at the NY auto show later this month, and Volkswagen has released an illustration of that vehicle (see above).
Volkswagen will invest another $340 million to build SUVs at its U.S. factory, a sign of confidence despite rising friction on worldwide trade, the company announced Monday.