The Jetta brand will be run by the German firm in co-operation with long-time Chinese joint venture partner First Automobile Works (FAW). It will target younger buyers outside major metropolitan areas. The two companies first revealed they were planning a budget brand in 2017.
Volkswagen sales boss Jürgen Stackmann said: “With Jetta, we're closing the gap between the established Volkswagen lead brand in the top volume segment and entry-level mobility, which accounts for about one-third of the Chinese market and is served mainly by local brands. This way, we will significantly increase our market coverage."
By the end of 2019, Volkswagen plans to establish up to 200 Jetta dealerships, and it says this network will be supported by a range of sales formats, including digital showrooms, shopping malls and mobile sales trucks.
The initial Jetta line-up comprises three models, the VA3, VS5 and VS7, with sales scheduled to start in the third quarter of this year.