GM Is Closing North American Plants. Another Major Automaker Is Planning to Open a New One

November 29, 2018, 11:13 AM UTC

GM may be closing American factories, but here’s an automaker that’s looking to open a new one up: Volkswagen.

The German car giant already has a plant in Chattanooga, Tennessee, but it wants a new one—possibly at the same site, possibly not—to build electric cars for the American market.

“We are 100% deep in the process of ‘We will need an electric car plant in North America,’ and we’re holding those conversations now,” Scott Keogh, the new CEO of VW’s U.S. operation, said yesterday, as reported by Reuters.

“The market timing actually is quite perfect,” he added. “You need to have this intersection of, ‘Can you get costs down enough that you can produce a car at that price point, make enough money, have the technology capabilities that this is a car that we would want to put in the marketplace, and have market acceptance?’ And when all these things intersect that’s ideally when you want to throw the dart.”

At the moment, Tesla dominates the U.S. market for electric cars, but its rivals are gearing up for major pushes.

Volkswagen was something of a laggard when it came to making electrification plans, but once it caught the bug it decided to go large. A couple months ago, the company announced plans to have a whopping 27 electric models across the various VW Group brands—also including Audi and Skoda—by the end of 2022. It hopes to be producing its first models next year, with the forecast for the first wave of models being 10 million vehicles.

The new North American plant would be for building an as-yet-unannounced vehicle under the VW brand, with target pricing of between $30,000 and $40,000, and a target release date in 2020. The company won’t be able to get its new plant up and running that quickly, of course, so the cars would have to be built at a different site at first.

It’s worth noting that GM’s restructuring is partly intended to effect a shift toward electric, potentially driverless cars. The Detroit-based firm also has plans to release 20 or so electric models by 2023.