The crusade by anti-union forces in Tennessee, including the state's governor, is now as much a fight with Volkswagen management as with the United Auto Workers union.

Not only are Republican legislators accusing Volkswagen of backing the UAW, but some of their leaders on Monday threatened to withhold tax incentives for future expansion of the 3-year-old assembly plant in Chattanooga, Tenn., if workers vote later this week to join the UAW.

About 1,500 workers will vote Wednesday through Friday in an election that the National Labor Relations Board will conduct.

The company plans to expand either in Chattanooga or at a Mexican plant to produce a midsize SUV. Overall, Volkswagen intends to invest about $7 billion in North America in the next five years to achieve a goal of selling more than 1 million Volkswagen and Audi vehicles in the U.S. by 2018.

"It has been widely reported that Volkswagen has promoted a campaign that has been unfair, unbalanced and, quite frankly, un-American in the traditions of American labor campaigns," state Sen. Bo Watson, R-Chattanooga, said in a statement sent to the Detroit Free Press. If the workers choose to be represented by the UAW, he said, he believes new incentives "will have a very tough time passing the Tennessee Senate."


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After an organizing campaign that began about two years ago, this week's vote is the UAW's best opportunity to win support at a foreign-owned assembly plant since Honda began building cars in Ohio more than 30 years ago. More than a half-dozen organizing efforts have failed at Japanese automakers' U.S. factories.

Volkswagen has tried to remain neutral, but the recent actions by Tennessee Gov. Bill Haslam; U.S. Sen. Bob Corker, R-Tenn.; and prominent anti-tax lobbyist Grover Norquist led the automaker's management to issue a statement over the weekend that "outside political groups won't divert us from the work at hand: innovating, creating jobs, growing, and producing great automobiles."

Norquist and a group called the Center for Worker Freedom have rented about a dozen digital billboards in the Chattanooga area trumpeting anti-union messages. One shows an image of the long-abandoned Packard factory's ruins with the message "Detroit: Brought to You by the UAW."

The company has allowed anti-union groups into the plant to talk to workers and distribute printed material.

David Smith, a spokesman for Haslam, said the governor believes it will become more difficult for Tennessee to recruit new manufacturers to the state if the Volkswagen is represented by the UAW.

"Any discussions of incentives are part of additional and continued talks with VW, which we look forward to," Smith said.

A group called Southern Momentum echoed other union opponents in a statement Monday.

"Further financial incentives -- which are absolutely necessary for the expansion of the VW facility -- simply will not exist if the UAW wins this election," said Maury Nicely, a Chattanooga labor lawyer opposed to VW's cooperation with the union.

Democratic legislators, who are a minority in both chambers of the Tennessee General Assembly, defended Volkswagen's prerogative to manage the plant as it chooses.

"In my 20 years on the hill, I've never seen such a massive intrusion into the affairs of a private company," said Tennessee House Democratic Rep. Craig Fitzhugh.

Martin Winterkorn, Volkswagen's global CEO, said last month the midsize SUV will go on sale in 2016 and the Chattanooga plant is under consideration for the investment. Winterkorn said the decision would not be influenced by whether workers vote to join the UAW. Volkswagen also has a plant in Puebla, Mexico.

If workers at the Volkswagen plant in Tennessee vote for UAW representation, the union and company will form a German-style works council. The council is a structure Volkswagen uses at most of its assembly plants around the world.

Volkswagen says the UAW has agreed to delegate to the works council many of the functions and responsibilities ordinarily performed by unions.

"Volkswagen considers their works councils their strategic competitive advantage," said Arthur Wheaton, a professor at Cornell University's school of industrial and labor relations. "U.S. labor law does not allow them to have a works council without a labor union."

Wheaton said Volkswagen would prefer to build the SUV in the U.S. because it has the space in Chattanooga and because it would keep transportation costs down.

"Our works councils are key to our success and productivity. It is a business model that helped to make Volkswagen the second-largest car company in the world," Frank Fischer, chairman and CEO of Volkswagen Chattanooga, said in a statement.