Volkswagen Annouces $340 Million Investment in Chattanooga, TN Plant to Build New Atlas SUV

Mar 19, 2018

Tennessee Governor Bill Haslam stands beside a concept drawing of the new VW Atlas five-seater at VW's Chattanooga, Tennessee assembly plant.

Volkswagen is investing $340 million in its Chattanooga plant to build a new version of its Atlas SUV—a version that will seat five people, unlike the current model, which seats seven. Officials made the announcement today at the plant and unveiled a concept sketch of the new Atlas.

“The Atlas has built strong momentum for Volkswagen in the SUV segment, and we are excited to grow ourSUV portfolio with this new, Chattanooga-assembled five-passenger SUV,” said Hinrich J. Woebcken, President and CEO, Volkswagen Group of America, Inc. “We are not only committed to this market, we are committed to our U.S. manufacturing home in Chattanooga, Tennessee.” 

The Atlas started production in 2016 in Chattanooga and went on sale in 2017, earning Cars.com’s Best of the Year. The $340 million investment comes in addition to $900 million VW has already put into its Chattanooga plant to build the Atlas. 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.

Chattanooga’s first vehicle was the Passat sedan, which is still manufactured at the plant, but Passat sales declined after a diesel emissions scandal that affected certain Passats and other models and cost the automaker billions in fines.

Tennessee Governor Bill Haslam spoke after the new Atlas announcement.

“So obviously Volkswagen’s had its challenges the last three or four years. I think the fact that they’ve stayed here, stayed committed, kept investing, says a lot about the workforce right here in Chattanooga and Hamilton County.”

The plant employs around 3,500 people. The new Atlas concept car will be unveiled at next week’s New York International Auto Show.