AURORA, Ont. (CP) -- Magna Seating, an operating group of Canadian auto parts giant Magna International Inc., and U.S.-based supply manager Hollingsworth Logistics, have formed a joint venture to supply German carmaker Volkswagen with seat systems for its new car line.
Financial terms of the partnership, which will create 120 jobs in the southern U.S. state of Tennessee, were not revealed Monday.
The seats will be built and shipped to Volkswagen of America for the mid-size sedan the company will build at its plant in Chattanooga, Tenn.
The joint-venture company, Chattanooga Seating Systems, is 51 percent owned by Hollingsworth and 49 percent by Magna Seating. The joint venture will be considered a minority supplier to Volkswagen because Hollingsworth' is a company owned by native Americans.
"This partnership is a great sign of things to come for everyone involved," said Frank Fischer, President and CEO for Volkswagen in Chattanooga.
"We are pleased that a minority-owned joint venture will be a part of our supplier team for the all-new mid-size sedan and that the addition of 120 jobs will continue to strengthen the economy here in the Tennessee Valley," Fischer said.
Steven Barr, owner and CEO of Hollingsworth Logistics Group, said the company has been a Magna partner for the last decade.
"We are very proud of our long-standing relationship with Magna and we look forward to adding CSS to our two existing joint-ventures."
Joe Pittel, president of Magna Seating, said "this joint venture strategically positions both companies for continued growth in North America."
Magna International is Canada's largest auto parts company, with 72,500 employees and plants around the world.
In Monday trading on the TSX, Magna shares fell 30 cents to C$63.07.