Volkswagen to invest $800 million in US electric car

Volkswagen AG (Ord) is heavily investing in electric vehicles. The German automaker is spending $800 million to build its new electric car, ID Crozz EV, in Chattanooga, Tennessee.

Why is the next Volkswagen electric car in the US?

Volkswagen is ramping up production of US automobiles with its expansion of its plant in the southern US state of Tennessee. The $800 million expansion will create about 1000 jobs and help the world’s largest automaker compete with upstarts like Tesla. In a statement, Volkswagen chief executive officer(CEO), Herbert Diess, noted that the expansion will help the corporation grow its US customer base.

‘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.The management team…is committed to continuing to increase our market share in the coming years,’ said Diess in a statement.

Volkswagen predicts that the ID Crozz will be available for sale in 2020 and production at the US plant is slated to start in 2022.

How will the US benefit from the Volkswagen electric car?

The Volkswagen deal is certain to benefit the growth of electric vehicles in the US. By producing the cars in the US, the cost of the electric vehicle will likely come down with the mass production of the ID Crozz. The investment is also sure to jumpstart vehicle production in the US. Tennessee governor, Bill Haslam, noted that the electric car development will be a boon to the southern US state.

‘The shift toward electric vehicles is a trend that can be seen worldwide, and Volkswagen’s decision to locate its first North American EV manufacturing facility in Chattanooga underscores Tennessee’s manufacturing strength and highly-skilled workforce. As one of Hamilton County’s top employers, these additional 1000 jobs will have a lasting impact on the region’, said Haslam.