WOLFSBURG – When Volkswagen Group CEO Dr. Herbert Diess and FAW Group Deputy Party Secretary and Vice President Qin Huanming shook their hands here on February 26, it ushered in a new era for the leading German automaker in China and the global auto industry has added a new brand.
The JETTA is finally here.
One of the bestselling models from the Volkswagen brand in China and one that Volkswagen claims “put China on wheels,” has completed its transformation.
The JETTA becomes the first sub-brand for the Volkswagen brand and the third brand from FAW-Volkswagen, exclusively tailored for the Chinese market. The official unveiling of the brand in Wolfsburg finally comes after years of discussion and intent between the two Chinese partners on launching a so-called “joint venture brand” akin to the Venucia from Dongfeng-Nissan and Denza from BYD-Daimler.
But the JETTA is different.
It is the first brand ever to arise from a model, and one that has become a household name in China over the last three decades carrying with it the reputation and legacy of being sturdy and reliable, or “pishi” in Chinese.
And Volkswagen plans to build on this proud past of the JETTA to give young and first time buyers in the entry segment trust and reliability from a proven track record.
“The new brand stands for Volkswagen’s quality, safety and tradition,” said Dr. Diess. “At the same time, it focuses on the many young Chinese customers especially those who are living in the fast developing cities beyond the metropolitan areas. Most of them are earning a car for the first time and longing for great design and advanced technology.”
In many cities where these target customers reside, vehicle ownership levels are still very low, in some cases below 100 cars per 1,000 inhabitants. With the JETTA brand, Volkswagen intends to address this market more effectively.
Currently about 81 percent of all vehicles sold in China’s entry-level segment are sold to customers who are buying a car for the first time. JETTA appeals to this target group by offering high quality, safety, emotionality, stable value and a fresh design.
JETTA however will NOT be an economy brand, according to Jürgen Stackmann, Member of the Volkswagen brand Board of Management responsible for Sales.
“Given all of its features, we will deliberately position the new brand above China’s average entry-level price of €5,000 to €6,000,” he said.
The JETTA model range, which is to be produced by FAW-Volkswagen in Chengdu, will include one sedan and two SUVs. One of the SUVs will be based on the SEAT Ateca, and they will be shown at the upcoming Shanghai Auto Show in April. Sales are scheduled to start in Q3 2019.
The JETTA is based on the key elements of the Volkswagen DNA: quality, safety, value and a clear design language. With the introduction of JETTA, the Volkswagen umbrella brand will be able to position itself even more clearly as “top of volume” with its vehicles and to further sharpen its profile. In addition, with this offering specially tailored to the needs of the Chinese market and developed together with FAW-Volkswagen, Volkswagen is forging ahead with the further regionalization of the market.
“With JETTA, we are closing the gap between the established VW 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,” said Stackmann.
“As the third brand from FAW-Volkswagen, the JETA is a new approach in deepening cooperation between the parent companies, further satisfies customer demands from China and the world and represents determination and wish for further cooperation, becoming a starting point for value innovation at the JV,” said Qin. “FAW Group will continue to support FAW-Volkswagen’s sustainable and healthy development, and drive the growth of the new brand.”
JETTA will establish its own network of dealerships and will approach customers directly with innovative sales formats – digital showrooms, shopping malls and mobile sales trucks. By yearend, about 200 dealers are to offer the new brand.
“With JETTA, the company is opening the Volkswagen world to first-time Chinese customers,” said Stephan Wöllenstein, CEO of Volkswagen Group China and Volkswagen Passenger Cars China. “The core of the new brand will contain Volkswagen’s very own DNA and will provide consumers with advanced technology that meets their needs and fits to their lifestyles.”
Last year, FAW-Volkswagen sold about 327,700 Jettas, accounting for more than a tenth of the 3.11 million vehicles Volkswagen brand sold in China. The plan is to sell at least 400,000 vehicles under the JETTA brand in 2021.