The UAW is creating a new local union to represent pro-union employees at Volkswagen's Chattanooga, Tennessee, plant.

The United Auto Workers union is down, but not out. After its recent efforts to organize Volkswagen’s assembly plant in Chattanooga, Tennessee, the union said it would not abandon the plant and it’s readying to make good on that promise by creating a new local union to represent pro-union workers at the plant.

The new local will not be the official representative of the workers at the plant until a majority of the workers inside the plant can vote again. The UAW suffered a demoralizing defeat when it lost a representation election supervised by the National Labor Relations Board by a 712 to 626 margin.

However, Dennis Williams, the UAW’s new president, said organizing the transplants remains one of the UAW top priorities. In addition, Berthold Huber, president of Germany’s IG Metal union, said in an interview during a recent visit to Detroit, the influential German Metalworkers was prepared to support the UAW’s drive in Chattanooga regardless of how long it takes.

IG Metal has representatives on Volkswagen’s Board of Supervisors and helped devise VW’s elaborate system of employee representation, which requires every plant in the VW manufacturing system have a works council made up of employee representatives that can discuss concerns with the local management.

VW's plant in Chattanooga, Tennessee, is in the running to produce the maker's CrossBlue crossover vehicle. Some believe without union representation, the plant will not get the vehicle.

So far, the Chattanooga plant is the only one in VW’s manufacturing system without a works council. Under U.S. law, which forbids company-created unions, employers using a works council model most have representatives elected or selected by an outside union to sit on the board.

Without a favorable majority vote, creating a works council in Chattanooga without UAW representation could be open to legal challenge.

However, once the new Chattanooga local is established and if VW’s top management approves production of a new crossover vehicle in Chattanooga, the UAW and IG Metal will undoubtedly claim the union’s presence played a crucial role the decision to build the new vehicle in Tennessee.

Letting the UAW have any credit at all for bringing the so-called CrossBlue crossover to the Chattanooga plant would be considered a major setback – if not a defeat – for Tennessee’s conservative and anti-union political establishment led by Republican Senator Bob Corker, a long-time foe of the UAW.

With sales of the mid-sized Passat wilting under intense competition from American and Asian automakers, the crossover is considered vital to the long-term success of the Chattanooga plant, which VW had envisioned from its inception as a multi-vehicle facility. Until now, the uncertainty around the plant has cut both ways for the union as it has brought some workers closer to the UAW while other have become anti-union because they feared for their jobs.

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VW officials have also confirmed recently they are also considering building the crossover vehicle at the automaker’s crowded manufacturing complex in Puebla, Mexico. In addition, with modern assembly techniques and technology, the new crossover also might be built at a new plant, which Audi is building in Mexico.

While much of the attention about foreign automakers build cars in North America has focused on the southeastern U.S., it is Mexico that has captured the largest of share of investment in automotive assembly plants during the last five years: the country’s web of free trade agreements make it easy to export from Mexico and costs are relatively low when measured against the non-union South.

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The United Auto Workers may well overcome a largely union-free Southern automobile manufacturing industry with its drive to organize the Chattanooga plant with a method outside of the National Labor Relations Board framework, noted Dan Cornfield, a labor expert and professor of sociology at Vanderbilt University in Nashville,

“This method occurs when the workers and union do not anticipate significant employer resistance to organizing the workplace,” Cornfield said.

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Cornfield said if the UAW is successful in setting up a local in Chattanooga, it also could set up local unions for voluntary members at other plants in the South.

IG Metal’s Huber said the German union’s key target after Chattanooga is the Mercedes-Benz plant in Tuscaloosa, Ala. Another priority is organizing workers at the BMW plant in Spartanburg. The UAW also has pro-union supporters at the Nissan plant in Canton, Mississippi, and in Smyrna, Tennessee, where it has lost two organizing elections in the last two decades.