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VW Reaping the Benefits of Toyota's Labor in Tenn Says Sen. Corker

As Volkswagen takes the wraps off its new American-built Passat sedan at the 2011 Detroit auto show, prominent Tennessee politician Bob Corker is giving credit to the company and its vision for new U.S. production--while he also gives a nod to Volkswagen's competitor in the mainstream sedan market, Toyota.

Corker (R.-Tenn.) says the arrival of Volkswagen marks another milestone in the state's long campaign to woo industrial jobs.

"It's an incredible thing for southeast Tennessee," he said prior to the launch of the Passat at Detroit's Cobo Center. "For 20 years our city has had a vision, and differing people have been able to put that vision into reality."

Corker served as mayor of Volkswagen's new U.S. hometown of Chattanooga from 2001 to 2005, and is widely considered the dealmaker who brought the German automaker to the city's outskirts. In 2006, Corker won the Senate seat formerly held by Bill Frist (R.-Tenn.), narrowly defeating Democratic candidate Harold Ford, Jr. (D.-Tenn.) in the midterm elections, as the only Republican elected to the Senate during President George W. Bush's second term.

As a Senator, Corker's been a vocal opponent of bailouts. In 2008, Corker opposed federal loans for ailing automakers General Motors and Chrysler, arguing that the government only should get involved in the car companies' finances if the United Auto Workers accepted cuts in wages and benefits, so that the downsized companies would have a more competitive cost structure.

In the same year, Corker was on hand when Volkswagen announced it would set down new American roots in Chattanooga, on a 1,350-acre site off Interstate 75. The new factory -- VW's second, since it formerly operated a factory in Westmoreland, Pennsylvania, into the early 1980s--represents an initial investment of $1 billion, will employ 2,000 workers, and will have an initial production capacity of 150,000 vehicles a year.

Corker opposed federal auto loans, but favors tax incentives to lure new companies to Tennessee. A report suggests the state might eventually spend $400 million over the next 20 years when tax incentives to the automaker and its workers are accounted for. 

Toyota's big help

Volkswagen wasn't the first manufacturer Corker and Tennessee had in mind for the Chattanooga site. Corker says that Toyota, in fact, had been a long-time suitor for the parcel of land, the site of a former ammunition plant. The Japanese automaker had finished construction on a truck plant in San Antonio, and was scouting locations for a new assembly plant where it would build its Highlande crossover vehicle.

"We actually got down to the short list of two or three, and Mississippi was chosen - and it was disappointing that we had worked very closely with Toyota for years," he says. However, the long discussions with Toyota actually helped the city prepare for its next round of bidding. 

"They helped us look at the site in such a way that an auto manufacturer would be willing, environmentally, to take on....We bought the land from the federal government as a city, [and] built the infrastructure into it.

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