* VW Tennessee workers to decide who represents them in
* Decision on where to build mid-sized SUV still coming by
* New Golf next year another U.S. growth opportunity
* November U.S. industry sales should accelerate toward end
By Ben Klayman
LOS ANGELES, Nov 20 Volkswagen AG
wants the workers at its Tennessee plant represented by a
German-style works council, but the final form of representation
and whether that includes the United Auto Workers union must be
decided by the employees in a formal vote, the automaker's top
U.S. executive said on Wednesday.
"Our strong desire is to have a works council present in
Chattanooga," Jonathan Browning, Volkswagen Group of America's
president and CEO, said in an interview at the Los Angeles Auto
Show. "The challenge in a U.S. context is how to bring that into
being. That's obviously the point of discussion in terms of how
you actually move forward."
The UAW has pushed VW to accept a German-style labor
council at the plant in Chattanooga, which would require the
involvement of the U.S. union under American labor law. VW said
in September it was in talks with the UAW about establishing
such a labor council at the plant, which would be a first for
the U.S. union.
The UAW, which has lost membership over the past three
decades because of increasing automation and job cutbacks by
General Motors Co, Ford Motor Co and Chrysler Group
LLC, wants to organize VW workers to gain a toehold in the U.S.
South, where foreign automakers have nonunion factories.
A successful push by the UAW at VW's Tennessee plant would
be significant for the union and for organized labor in the
United States, where union membership fell to 11.3 percent of
the workforce in 2012, the lowest percentage in 76 years.
The UAW has pushed Volkswagen to recognize the union as the
representative of workers at Chattanooga, based on cards
endorsing the union signed by more than half of the plant's
In Germany, a works council represents both blue-collar and
white-collar workers. It represents employees on work rules in
the plants and some other dealings with the company, but wages
and benefits are negotiated by IG Metall. The German union has
backed the UAW's efforts.
But Browning said any decision on how the workers are
represented will ultimately be made by those affected.
"The critical thing that we have emphasized really
consistently is that that decision in terms of representation
will be taken by the employees and through a formal vote. And so
there will be an election process by which the employees decide
on how they wish to be represented."
VW's top labor leader visited Chattanooga last week to meet
with officials and local politicians. Browning said Bernd
Osterloh, the head of VW's global works council, has reaffirmed
his support for a works council setup in Tennessee.
Browning said the topic has been discussed heavily and
employees need to have "informed views" of their options.
"There has to be some level of debate," he said. "Obviously,
we're looking for it to be as constructive as possible."
VW's board meets this week, but a decision by the board on
whether to allow the UAW to represent workers at the VW
Tennessee plant, in tandem with a German-style works council,
does not seem likely soon.
However, Browning still expects a decision before the end of
the year on where the German automaker will be a mid-sized,
seven-passenger crossover utility vehicle. The options include
Chattanooga and Mexico. He said the Tennessee plant can add a
second product without needing to expand.
VW has said the vehicle, based on the "CrossBlue" concept
unveiled in January at the Detroit auto show, would be sold in
the U.S. market by 2016 or 2017.
Browning said adding a mid-sized SUV is a "top priority."
Browning later told reporters that another U.S. growth
opportunity for VW is the compact hatchback market with the
redesigned Golf making its debut next year. He also said the
Polo, which is smaller than the Golf, could be successful in the
United States, but it would need to be built in North America to
make economic sense and that vehicle was not a priority in the
Browning told Reuters that commercial vehicles are another
growth area eventually, echoing previous comments by VW, but
were "not an immediate opportunity."
He said VW still expects U.S. industry new-car sales to
finish at 15.5 million to 15.6 million vehicles this year, which
would be up from 14.5 million last year.
Browning added that U.S. industry sales in November should
accelerate toward the end of the month.
"A lot of business typically gets conducted after the
Thanksgiving holiday, so we'll see November run pretty strong
towards the end of the month," he said. "And there's a weekend
at the end of the month, so that always means it's a pretty
active close to the month."