Will Volkswagen’s New Factory Help the US Maintain It’s Edge?

VW Passat Variant

Image via Wikipedia

[tweetmeme]A significant event happened this week in the world of manufacturing.  You may recall a post titled US Factories Maintain Edge? where we discussed how the United States is still the world’s #1 manufacturer but many project that China will overcome the US in the next several years.  Time will tell if these projections are accurate or if China’s growth levels off to the point that the US remains #1.  This event tips the scale towards the United States.

Volkswagen opened a new car factory in Chattanooga, Tennessee.  This plant is producing the first VW’s in the US since they closed their Pennsylvania plant 23 years ago.   This brings 2000 jobs to Tennessee to produce 150,000 vehicles annually according to published accounts.  This does not even take into account the jobs that will be created in Tennessee and other states to support this new facility.  Expansion of the new plant could happen as soon as 2012.

Volkswagen took this opportunity to build on their great feel good Super Bowl ad by bringing their pint-sized Darth Vader to the grand opening.  You can see the commercial below if you somehow missed the ad.

[tweetmeme]Will events like this be enough to keep the US on top of the manufacturing mountain?  Are you more likely to buy a VW Passat manufactured in the US if you are an American?  Are Tennessee residents going to buy more VW’s?

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About Christian Paulsen

Christian Paulsen is an Executive Consultant with 20 years of Lean Manufacturing. Chris adds value to organizations by driving process improvement and bottom line savings. Chris intends to help others by sharing the lessons learned after a quarter century of operational leadership, marriage, parenting, and even longer as a Cubs fan. Your comments on this blog are welcome. You can also connect with Chris via LinnkedIn, Twitter, and Facebook in the right sidebar. Chris welcomes your comments. Christian's professional services are available by contacting him through LinkedIn (right side bar)
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2 Responses to Will Volkswagen’s New Factory Help the US Maintain It’s Edge?

  1. Mark says:

    Hello Christian,

    Great article. I always wonder if people support their local economies and although I cannot quote any great studies on this, my gut feeling is that consumers get jazzed up when a project is announced and then eventually that enthusiams dies down, unless there is an outside force reminding them of the reason they were initially pumped up.

    Also the cars must be high quality and affordable.

    I am not really sure if the US is still on top of the manufacturing mountain at this point, hard to argue that China is no, but hopefully as their economy grows and their residents want to earn and hence consume more products, that will drive up labor costs and less will flock to have their products manufactured over there.

    • Hi Mark,

      Great insight. You are right that people will forget quickly. I worked in Little Rock at the Skippy Peanut Butter plant. Little Rock isn’t that big yet no one knew we were there. We even put up some bill boards which helped with awareness but no one seemed to know we were there as soon as the signs came down. The US is still #1 statistically but most analysts think it’s just a matter of a few more years before China is the top producer. China is having labor troubles though. They don’t have enough skilled workers so labor costs are going up 17% annually according to one article in Industry Week (if I remember correctly). Thank you for your comments.

      Chris

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