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‘Watch & Wait’ at Volkswagen’s Only U.S. Plant

CHATTANOOGA, Tenn. (CN) - The 3,200 people who work in Volkswagen's only U.S. assembly plant, in Chattanooga, which prided itself on its solar energy, rainwater recycling and habitat protections when it was built in 2011, were staggered, along with the rest of the world, by last week's exposure of massive environmental cheating by VW.

The $1 billion, 1,400-acre auto park was built with 33,000 solar panels, rainwater collecting devices, energy-saving lights, on-site protected wetlands and habitat for native vegetation, a wildlife corridor supported by two creeks, and a heat-reflecting white roof.

In addition to the 3,200 Tennesseeans who work on site, another 9,500 work for indirect suppliers, according to the VW website. Local, state and federal governments gave VW $577 million to build the plant in Tennessee.

Gov. Bill Haslam said Monday his "primary concern is getting Volkswagen back to where they're in a mode to sell cars."

The Passat, which is made in Chattanooga, accounts for 29 percent of VW's U.S. sales. The Chattanooga plant can produce 150,000 cars a year. Haslam and other Tennessee lawmakers told the Chattanooga Times Free Press they are trying to set up a meeting with VW executives.

Chattanooga Mayor Andy Berke said he spoke with VW officials as soon as news of the scandal broke.

"I spoke with VW leadership earlier today to express my concerns about the current situation and what impacts, if any, it might have on the Chattanooga plant," Berke said last Tuesday. "VW officials assured me they are taking this matter seriously and explained how critical the B SUV is to their North American market strategy."

It's uncertain what the reference to the Volkswagen B SUV means, as the Chattanooga factory makes only Passats now.

More than 120 class action lawsuits have been filed in the 10 days since the Environmental Protection Agency ordered VW to recall nearly 500,000 diesel autos sold in the United States.

The software allows VW's "clean diesel" engines to spew 40 times the amount of nitrogen dioxide permitted by regulation during normal driving, and kicks in only during emissions testing, when the engines test clean. Facing up to $18 billion in Clean Air Act fines in the United States alone, the scandal spread worldwide when Volkswagen admitted it had sold more than 11 million cars with the cheating software.

University of Tennessee-Chattanooga economics professor Bruce Hutchinson told Chattanooga TV station WRCB that he expects the scandal will cost Chattanoogans their jobs.

"Some people are going to lose jobs, at least temporarily, those jobs will disappear," Hutchinson said. "There's going to be disruption."

Congressman Marsha Blackburn, R-Brentwood, called the scandal "troubling."

Blackburn is one of three women in Congress who calls herself a congressman.

"Consumers are understandably upset and that is why it is imperative Congress follow the facts to understand exactly what happened and why. Our investigation is just beginning," Blackburn said.

The EPA said last week that new testing procedures will look for defeat device software that masks emissions during inspections. Volkswagen engineers designed the cheating software with parallel pathways, one of which operated during driving and one only during emissions tests. Cutting out the emissions software gave the cars better mileage, better acceleration and response and made them more fun to drive.

Plaintiffs in the deluge of class actions claim that the cars they will have after the cheating software is removed will not be the same cars they bought.

The scandal has cost Volkswagen CEO Martin Winterkorn his job. In resigning last week, he said he was not aware of any wrongdoing on his part, though he was in charge of research and development. The company named Porsche chairman Matthias Mueller as Winterkorn's successor on Friday.

German prosecutors said Monday they are investigating Winterkorn.

Volkswagen granted the United Auto Workers partial recognition in December after the union showed it represented more than 45 percent of Chattanooga plant workers. Partial recognition means VW management will meet with union reps to discuss conditions at the plant, though collective bargaining rights have not been established.

A VW spokesman told Tennessee media Monday that the Chattanooga plant is operating as usual.

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