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VW to pick site in 8 days(The Decatur Daily (AL) (KRT) Via Acquire Media NewsEdge) Jun. 30--The Volkswagen countdown has begun. According to a Sunday article in German's Auto, Motor und Sport, as reported by Thompson Financial, Volkswagen AG's management board will decide in eight days -- on July 8 -- where it will build a U.S. plant. According to the German magazine, considered a leading publication on the German auto industry, Volkswagen's supervisory board will vote on whether to ratify the management decision July 15 in Wolfsberg, Germany. The German publication reported the decision date in a pre-release of an issue to run Thursday. According to the article, Alabama and Tennessee are the frontrunners. Volkswagen in March listed Michigan as a contender, too. According to the article, the plant will cost VW 500 million euros, or $788 million. All attention in Alabama and Tennessee has been on two sites. In Alabama, the state is working to prepare a site in Huntsville-annexed Limestone County, near Greenbrier Road and Old Alabama 20, about 9 miles northeast of downtown Decatur. Surveying crews have for weeks been doing the preliminary work needed to expand and realign Greenbrier Road, which would connect the industrial site to Interstate 565. In Chattanooga, the focus is on Enterprise South, a Tennessee Valley Authority Megasite on Interstate 75, about 12 miles northeast of downtown Chattanooga. Production at the site is to start in 2010, the magazine reported, with an annual capacity of 300,000 cars to be reached by 2018. Level site According to Alabama officials, a major advantage of the Limestone County site is that it is flat, requiring almost no excavation to prepare it for construction. The Chattanooga site needs excavation before building can commence, but according to reports, state workers have already begun leveling the site. Another advantage of the Limestone County site, Gov. Bob Riley has stressed, is its proximity to the $71 million robotics center to be established at Calhoun Community College. Volkswagen makes extensive use of robots in its existing plants. Riley said layoffs at Delphi Corp. and Wolverine Tube Inc. also increase the attractiveness of the area to Volkswagen because of the available skilled labor. All three states have presented economic incentive packages to Volkswagen, although none of the states has divulged details. If VW chooses Alabama, voters going to the polls on Nov. 4 may vote on how to pay for the incentive package, reported to be worth $200 million. State Finance Director Jim Main said he favors paying for them with a one-time withdrawal from the Alabama Trust Fund, the state's savings account for royalties from natural gas wells drilled in state-owned waters along the Alabama coast. It has a balance of $3.2 billion. Pulling out that money would require statewide approval of a constitutional amendment. Another option, also requiring voter approval, would be to increase the state's bond-issuing authority. Other funding options Other options involve bond issues that would be paid for by both the state education and General Fund budgets or just the General Fund budget. Those options would not require a statewide referendum, but would use up money that otherwise could go to the daily operations of state government and public schools, which already are tight because of slow revenue growth. VW officials have discussed the possibility of a U.S. plant since 2005. They have consistently described a plant that would employ about 2,000 workers and would produce at least 250,000 vehicles a year. Their reported goal is for the plant to begin production by 2011. VW's only North American plant is in Puebla, Mexico, where it produces the Jetta and the Beetle. The plant is near its maximum capacity of 500,000 vehicles a year, and the company has said it will not expand the plant. Volkswagen had a 2,500-employee U.S. plant, in Pennsylvania, from 1978 until 1998, when it closed because of low U.S. sales. In 2007, Volkswagen delivered 6.2 million vehicles worldwide, 329,000 of them in the United States. VW's share of the U.S. passenger car market was 2 percent, according to its 2007 annual report. In March, a member of the VW board of directors said the U.S. plant would produce a replacement for the Passat -- to be redesigned and renamed for the U.S. market -- that would sell for about $20,000. Eventually the plant would produce other cars and possibly sport utility vehicles, he said. According to some reports, the plant also would produce the Audi A4. In addition to VW cars and trucks, Volkswagen makes vehicles under the Audi, Skoda, Seat, Lamborghini, Bentley and Bugatti brands. To see more of The Decatur Daily, or to subscribe to the newspaper, go to http://www.decaturdaily.com Copyright (c) 2008, The Decatur Daily, Ala. Distributed by McClatchy-Tribune Information Services. For reprints, email [email protected], call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. |