AUBURN HILLS, Mich. --

Volkswagen AG is moving its North American headquarters from Michigan to northern Virginia so it can attract a skilled young workforce and get closer to its customers, The Washington Post reported Thursday.

Wednesday night, Gov. Jennifer Granholm held a dinner meeting in Lansing with Stefen Jacoby, CEO of Volkswagen American, reportedly to try to persuade to get the company to stay in Michigan.

"The governor is always making the case for Michigan, and she will continue making the case for Michigan," Granholm spokeswoman Liz Boyd said earlier in the day.

"I think she is a day late and a dollar short," said Oakland County Executive L. Brooks Patterson. "He's going there to drop the bomb. He said he's leaving and he's going to take a thousand jobs with him."

The office of Virginia Gov. Tim Kaine said he would make an economic development announcement Thursday morning near Dulles International Airport.

A spokesman declined to say it related to VW.

The German automaker now employs about 1,600 people at its headquarters in the Detroit suburb of Auburn Hills and in nearby Rochester Hills.

The company will bring 400 jobs and will invest about $100 million as it shifts operations to Herndon, Va., the newspaper reported. It said the move will eliminate 400 positions, leaving 600 jobs in suburban Detroit.

Volkswagen of America's new president and chief executive said that northern Virginia's good schools, skilled workers and proximity to Dulles International Airport made it an attractive site.

"For a young talent, 35 years old, to come here with his family ... is a very important factor," Jacoby told the Post. "By reducing this organization by 30 percent, you need even more talents, more creative people, more motivated people."

VW decided in early 2006 that it wanted to move to the East Coast, which he said was home for most of its customers, Jacoby said.

"You want to work in an environment where you see your customers, where you see your cars on the road," he said. "You don't want to work where you basically see only American cars of the Big Three."

"It's very bad for Michigan because we are losing so many jobs. But, it's sort of logical to me for Volkswagen because it's the small guy here in Detroit," said auto analyst Michele Krebs.

Economic development officials in Michigan's Oakland County, where VW's headquarters is located, also attended Wednesday's meeting in hope of making a pitch to keep the jobs, said Maureen Krauss, deputy director of economic development and community affairs.

Governor Granholm Releases Statement On Volkswagen Announcement:

LANSING – Governor Jennifer M. Granholm today issued the following statement on Volkswagen’s presence in Michigan:

“We are grateful that so many Volkswagen jobs are staying in Michigan. By choosing to continue their automotive and technology related functions here they will be retaining 600 of their employees in Michigan. We look forward to continuing our strong relationship with Volkswagen in the years to come.”

Granholm met with Stefan Jacoby, incoming President and CEO of Volkswagen of America last evening. In conversations and a formal letter to the Governor, Jacoby said Michigan is and will remain an important global center for the industry and Volkswagen.

“The strength of Michigan as a business center, and the support it provides to businesses operating there, are key reasons we decided to maintain important function in the State,” Jacoby wrote. “We will hope to increase our activity in Michigan in the future.”

According to Jacoby, the company will have 600 employees and contractors in Michigan. They are establishing a new U.S. headquarters in Northern Virginia with approximately 400 employees. The operations and people remaining in Michigan include key financial and technical functions, which represent excellent jobs for the community from an economic perspective.

Jacoby acknowledged the Governor, the Michigan Economic Development Corporation, and Oakland County for a steady dialogue with his office on the company’s business needs and for urging it to consider expansions in Michigan.

“You have made clear that Michigan is ready to put forward competitive economic proposals that could facilitate such investments,” Jacoby wrote.