Audi may boost size of new US auto plant by $3 billion, add 3,000 jobs

Audi Eyes $3 Billion Expansion and 3,000 More Jobs at Georgia Auto Plant

Audi's Ambitious Plans for U.S. Manufacturing Expansion

By David Shepardson

Initial Investment and Incentives

WASHINGTON, Nov 5 (Reuters) - Volkswagen ​luxury unit Audi will receive hundreds of millions of dollars in state tax incentives and grants to build a $4 billion assembly plant in the state of Georgia and is considering a second phase, documents released on Thursday showed.

Details of the Georgia Plant

Audi announced plans on October 25 to build its first US assembly plant near Macon, Georgia to open in the early 2030s that will produce ⁠200,000 SUVs annually and employ 4,500 workers. The automaker is considering a second phase that would cost another $3 billion and add 3,000 workers by 2033, according to documents released by the Mid-Georgia Gateway Development Authority. 

Company Response

Audi declined to comment.

State and Federal Support

Tax Incentives and Grants

The state is giving Audi the 1,500-acre site, providing $458 million in tax incentives and more than $120 million in grants for infrastructure, rail improvements, environmental site remediation and construction and another $430 million for water, road improvements, utility issues and workforce training and recruitment.

Tariff Relief Efforts

Reuters reported last week President Donald Trump's administration has promised tariff relief to Audi to help secure the plant's future. US officials told Audi executives the government plans to offer broad relief from tariffs for automakers making significant investments in US production.

Negotiations on Tariff Rates

Two ​sources briefed on the matter said Audi has pushed the US to ⁠reduce the 15% tariffs it pays on imports from the EU to 7.5%, but that ​the US Commerce Department was expected to agree to around 10%.

The tariff relief program aims to prod automakers to add US production or other investments, the sources added.

Impact of Tariffs on Audi

Trump's tariffs on autos, steel, aluminum and ​parts cost Audi ⁠around €1.2 billion ($1.4 billion) last year as it imports all its vehicles for the US market from Europe or Mexico.

Currency Exchange

($1 = €0.89)

(Reporting by David Shepardson; Editing by Chris Reese and David Gaffen)