Volkswagen will add 1,000 jobs to Chattanooga, Tenn., as part of its first electric vehicle facility in North America, the company announced Monday.
The company plans to spend $800 million on a manufacturing facility in the state. Production is slated to begin in 2022. Beyond the direct jobs created, the company expects area automotive suppliers will hire employees.
“The US is one of the most important locations for us and producing electric cars in Chattanooga is a key part of our growth strategy in North America,” said Dr. Herbert Diess, CEO of Volkswagen AG. “The management team…is committed to continuing to increase our market share in the coming years.”
Volkswagen already has a presence in Chattanooga, opening a plant there in 2011 where it makes the Atlas SUV and the Passat sedan.
Like many vehicle manufacturers, Volkswagen is betting big on electric vehicles. The company said last month it would stop making gas powered cars by 2026. It plans to have the capacity for up to 14 million electric vehicles over the next several years.
Prices for entry level electric vehicles are expected to start at $22,700.
Volkswagen is the world’s largest carmaker, last year selling some 10.7 million vehicles. But a diesel emissions scandal in its Audi subsidiary in 2015 and shifting consumer habits have caused it to dramatically shift focus away from traditional vehicles.
It’s hardly alone. Other German carmakers have also entered the electric car market on the luxury side. In September, Audi started production on its e-tron and Mercedes-Benz unveiled its EQC model.