February 13, 2014 at 8:37 am

VW: No connection between union vote, SUV production

Workers walk by the Volkswagen AG plant in Chattanooga, Tenn. (Erik Schelzig / AP)

Chattanooga, Tenn. — Volkswagen AG denied claims made by a Tennessee senator that the German automaker would agree to build a midsize SUV at its plant here if 1,500 workers vote to reject joining the United Auto Workers union.

Late Wednesday, U.S. Sen. Bob Corker, R-Tenn., a former Chattanooga mayor who has been an ardent opponent of the UAW, warned earlier this week that it would damage the economy and discourage other auto suppliers from locating if the plant agreed to a German-style works council at the plant.

“I’ve had conversations today, and based on those am assured that should the workers vote against the UAW, Volkswagen will announce in the coming weeks that it will manufacture its new mid-size SUV here in Chattanooga,” Corker said in a statement.

VW said in a statement that wasn’t true: “There is no connection between our Chattanooga employees' decision about whether to be represented by a union and the decision about where to build a new product for the U.S. market.”

UAW Region 8 Director Gary Casteel, who directs the union’s southern organizing, also questioned the comment.

“Senator Corker’s comments directly contradict statements made by Volkswagen that placement of the SUV is not tied to the vote on the UAW,” Casteel said. “Who better knows about product placement than Volkswagen?”

Workers on Thursday will begin the second day of three days of voting on whether to join the UAW. It would be the first time workers at a foreign assembly plant — not part of a joint venture with a U.S. automaker — agreed to join the UAW. The area was pelted by a rare heavy snow overnight.

European works councils — a committee of blue collar and white collar that typically have less authority than a traditional union — don’t currently exist in the United States. If the majority of workers vote for UAW representation, workers would then elect a bargaining committee from among workers in Chattanooga to negotiate an agreement with the company, including how a works council would operate in the plant.

Workers would vote to accept or reject any agreement reached by that committee. They would include issues of safety, job security, efficiency and other issues. European works councils don’t typically negotiate wages.

The UAW says if workers at the Chattanooga VW plant join the UAW, they would have a seat at the VW Global Group Works Council “and would have an advantage in bringing more jobs to Tennessee.” Of VW’s more than 60 major plants worldwide, Chattanooga is the only one without a union.

Opponents funded by conservative groups are mounting a campaign to convince automakers not to join the UAW, including taking out a full page ad Thursday in the local newspaper and putting up billboards across the city that tie Detroit’s blight to the UAW.

Last month, VW announced it will invest $7 billion in North America over five years and confirmed it will bring a mid-size SUV to the U.S. market in 2016, but didn't confirm if it will build it at its Chattanooga plant.

"We have to push a little bit more on the pedal," said Michael Horn, the new top U.S. VW executive, last month.

VW currently sells a Tiguan compact SUV that is assembled in Europe. The compact SUV segment in the U.S. is more than 2 million vehicles and growing — and VW should build one in North America, Horn says. "Customers want these cars," Horn said.

His boss, VW Group chief Martin Winterkorn, reaffirmed the goal set in 2008 to sell 1 million VW and Audi vehicles in the U.S. by 2018 — to more than triple its sales over a decade. Winterkorn met with U.S. dealers in the Washington, D.C., area this summer to emphasize the company would bring new models to the U.S. market.

Sen. Bob Corker, R-Tenn., has warned that it would damage the economy and ... (J. Scott Applewhite / AP)