Saturday, August 2, 2014 · 2:33 a.m.

Evolution of the Southern auto industry

Haslam addresses conference, discusses auto industry, skilled workforce

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Gov. Bill Haslam spoke at the Southern Automotive Conference in Chattanooga Thursday. (Photo: Staff)

Gov. Bill Haslam said Thursday that many governors, including himself, came into office two years ago wanting to be a jobs governor.

“If you’re going to be the jobs governor, before you do that you’d better be the education governor,” he said at the Southern Automotive Conference.

Over the past two decades, the auto industry brought countless jobs and suppliers to Tennessee, starting with then governor Lamar Alexander, who helped bring Nissan to the state in the early 80s, Haslam said.

But it’s only in the last 25 years that the South has been a hub for auto manufacturing, Bill Visnic, Edmunds.com senior analyst, said.

The transition South
Domestic carmakers are traditionally rooted in the northern, more union-friendly states, Visnic said.

“But as things started to mature, it moved southward,” he said.

The textile industry weakened and left room for auto manufacturing, he said.

National Governors Auto Caucus 

In August, Haslam has joined two other governors, whose states have large automotive plants, in creating the National Governors Auto Caucus, a bipartisan group to address topics that impact the auto industry.

Read more here

Another factor is land. Auto plants need a large area of land and the northern and midwest states didn’t have that.

Tennessee and other southern states are also right-to-work states, which is attractive to auto leaders.

So, as European car makers, such as Mercedes, moved, other leaders started realizing the benefits of operating in the South.

“It did open a new vista to the entire automotive industry, [for others] to start examining the viability of setting up in the south,” Visnic said. “It’s been a strong upward trajectory since then.”

In July 2008, Volkswagen leaders announced they would invest $1 billion in the local economy and bring at least 2,000 jobs to the area. Now they have hired more than 3,000 people.

Haslam said he has learned that all jobs aren’t equal, because some industries, such as the auto industry, bring with them a supplier chain.

“We must be doing something right in the south, so many auto manufacturers have chosen our region time and time again,” he said.

Training a workforce 
And as auto plants have come to the state, leaders have worked to adjust and give them qualified employees, Haslam said.

Volkswagen leaders have helped state leaders understand what skills are needed to have a successful workforce, he also said.

“Your presence has helped us provide better training,” he said about companies such as Volkswagen.

And Volkswagen leaders have taken an active role in education.

The company has an automotive mechatronics program and trains employees through the Volkswagen Academy.

And VW has partnered with UTC to provide access to an MBA program at the Volkswagen Academy, where 20 postgraduate students from nine different Chattanooga companies are working on a master's degree.

The transition into the South left a generational gap in skilled workers, Visnic said. 

A recent report from Robert Half International, a staffing agency that has Chattanooga offices, revealed that, despite the attention to the high unemployment rate, some employers can’t find workers with the needed skills.

And in March, CNNMoney reported that some U.S. manufacturers are searching for skilled workers outside the United States because they can't find them in America.

Haslam said Thursday that he will continue to support education, which will continue to promote the state’s workforce.

And Visnic said developing a generation of skilled employees is needed.

“I think it’s going to be important now to begin developing that next generation of young people, who are trained and skilled and have an understanding of what it’s going to take to work in these plants,” he said.

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