VW executives say plant in Chattanooga on schedule

CHATTANOOGA, Tenn. (AP) - Construction of Volkswagen's assembly plant in Chattanooga is on track for production to start in early 2011 and a top executive also said Friday that more than half the $519 million in plant construction contracts awarded so far have gone to local companies.

The $1 billion plant near Interstate 75 in southeastern Tennessee is to have about 2,000 employees and is expected to create thousands of other related jobs.

CEO Frank Fischer said at a news conference that VW has decided to add about 43,000 square feet to the assembly area at the 1.9 million-square-foot complex where a yet-to-be revealed, mid-size sedan will be the first product.

Volkswagen has awarded 51.4 percent of the contracts - $267 million - to local companies and purchasing director Tom Loafman said the German automaker has already exceeded its start-of-production goal of awarding at least 5 percent of vehicle contracts to minority firms.

He said VW has been involved in bringing suppliers together with minority contractors toward reaching the same goal.

The company aims to boost the percentage of minority contracts to 10 percent by 2015.

Fischer said VW's new Jetta Sportwagen will hit U.S. showrooms in September.

Fischer declined to comment on speculation that other models will also be made at the plant or to make a prediction about sales following the end of the cash-for-clunker program.

VW plans to build about 150,000 vehicles annually at the plant.

About 150 employees have been hired in Chattanooga. Hiring for specialized jobs will begin in about two months and hourly employees will be hired early next year.

Company executives announced that students at four universities - the University of Tennessee at Chattanooga, the University of Tennessee, Georgia Tech and Auburn University - have been invited to compete in providing the design of a 500-foot-long bridge that will connect the training and entrance area of the complex to the manufacturing sections.