Volkswagen will launch its long-awaited budget brand in China next year, with the first product from the new brand set to be an SUV, according to Autocar. The move was confirmed by Jochem Heizmann, Volkswagen’s board member responsible for China, who told the publication that the first offerings that will be made in partnership with Chinese car maker First Automobile Works (FAW) will “focus on the SUV segment.”

He added that the upcoming brand had not yet been named, but stated that it will not be badged as a VW. Back in 2011, the FAW-Volkswagen JV brand for the Chinese market was reportedly set to be called Kaili, with the sub-brand responsible for developing electric vehicles.

Vehicles from the new brand are slated to be sold in the Chinese market, but the automaker might look at expanding it to other regions such as Latin America, Eastern Europe, Africa, India and the Baltic region, though no timelines for these have been given.

Announcing its 2016 financial results yesterday, the VW Group said that letters of intent have been signed FAW and JAC in China. Last year, Volkswagen sold 4.0 million units in China(including the Hong Kong market), a 12.2% increase over 2015.

Earlier in the week, the automaker had announced that it had signed a MoU with Tata Motors to explore long-term strategic cooperation in India, with vehicle development to be led by VW’s Skoda division.