Volkswagen’s Jetta brand has established a new company in Chengdu, southwest China, as it seeks greater autonomy and faster decision-making to compete in the country’s increasingly competitive automotive market, FAW-Volkswagen said.
The new entity, FAW Volkswagen Jetta Automotive Technology Co Ltd, officially began operations this week and has been granted enhanced market-oriented research and development capabilities, along with greater authority over product and business decisions, according to a statement from FAW-Volkswagen.
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The Chengdu-based company will lead the development of smart electric vehicles tailored to local Chinese market demand, while integrating Volkswagen’s global technology resources with FAW Group’s supply chain system. As a core strategic shareholder, Volkswagen will provide access to its global R&D network and electrification platforms and support the Jetta brand’s overseas expansion, the statement said.
The new unit plans to launch five all-new models by 2028, four of which will be new energy vehicles (NEVs). FAW-Volkswagen said the Jetta brand has set a mid-term sales target of between 400,000 and 500,000 vehicles per year.
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Local authorities said the company’s first model is expected to be launched by 2026. Separately, Chinese media outlet Lanjinger reported that Jetta’s first NEV is scheduled to debut in the third quarter of this year and go on sale in the fourth quarter. The model is expected to be a sedan produced at a Chengdu manufacturing facility, the report said.
Jetta was launched as an independent brand by FAW-Volkswagen in March 2019, alongside three initial models, marking a shift toward a more locally focused brand strategy within the joint venture. The move aimed to strengthen Volkswagen’s position in China’s mass-market and entry-level segments.
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In August 2025, FAW Group, Volkswagen and the Chengdu Economic Development Zone Management Committee signed a cooperation agreement to establish a new Jetta-branded company in Chengdu. The joint venture was formally registered in December between FAW-Volkswagen and a Chengdu state-owned enterprise.
The creation of the new company comes as foreign automakers in China increasingly reorganise local operations to respond more quickly to market shifts, particularly as domestic manufacturers accelerate their push into electric and intelligent vehicles.
