Gestamp, which is already a supplier at the Chattanooga Volkswagen plant, plans to open a new pressing facility by the plant, the Wall Street Journal reported.
The new Gestamp facility will employ 500, the report said.
The work will be for the new Cross Blue mid-sized SUV to be produced at the local plant.
Volkswagen Group of America Chattanooga Operations, LLC (Volkswagen Chattanooga) said it will host a press conference on Tuesday to announce "a major economic development."
Senator Bob Corker and Governor Bill Haslam are among those set to attend.
Also taking part will be Volkswagen Chattanooga and supplier officials, Economic and Community Development Commissioner Randy Boyd and County Mayor Jim Coppinger.