The United Auto Workers union has suffered a fresh defeat at a Volkswagen plant in Tennessee, with workers narrowly voting down a move to organize the factory for a second time.

The UAW has never managed to fully organize a US plant owned by a foreign manufacturer and a win at the German carmaker's Chattanooga facility would have been a significant victory.

But the 1,700-strong workforce at the factory rejected the move by a margin of 833-776 in a ballot that concluded Friday.

The organizing effort was attacked by state Republicans and hampered by an ongoing federal corruption probe, with a former vice president of the auto union soon to be sentenced after pleading guilty to misappropriating funds.

‘Pending certification of the results by the National labour Relations Board and a legal review of the election, Volkswagen will respect the decision of the majority,’ said the carmaker's Chattanooga plant chief Frank Fischer.

‘We look forward to continuing our close cooperation with elected officials and business leaders in Tennessee.’

UAW organizing director Tracy Romero said the company had engineered a defeat in the vote through ‘fear and misinformation.’

‘Over a period of nine weeks -- an unprecedented length of time due to legal gamesmanship --Volkswagen was able to break the will of enough workers to destroy their majority,’ she added.

A 2014 vote to organize the factory was defeated by a 53-47 percent margin after stiff opposition from local politicians, who warned that a UAW victory would make it harder to attract new jobs to Tennessee.

A smaller ballot of 160 skilled workers at the plant passed by a wide margin the next year, but Volkswagen challenged the result.

Political interference and the current state of US labour laws contributed to Friday's defeat, UAW spokesman Brian Rothenberg said.

‘This is a system designed to benefit corporate lawyers, not protect worker rights,’ he added.