Volkswagen AG and its Chinese joint venture partner FAW Group Corp. broke ground on a CNY5 billion plant to build Jetta sedans, the Chinese car maker said Friday.

The 800,000-square-meter plant in Chengdu, the capital of southwestern Sichuan province, will have an annual capacity of 150,000 units, FAW Group said in a statement. It said it expects the project to create 4,500 jobs.

The Jetta was the third best-selling compact car in China in 2008, after Toyota Motor Corp.'s Corolla and Hyundai Motor Co.'s Elantra, according to market research firm JD Power and Associates. More than 200,000 Jettas were sold in China last year, the firm said.

"From Volkswagen's perspective, China is the most important market now and in the future," Volkswagen Group China President and Chief Executive Winfried Vahland was quoted as saying in the statement. "Chengdu is the base for reaching our goal of selling 2 million units annually (in China) by 2018."

The German auto maker sold 1,024,008 units of its Volkswagen, Audi, and Skoda brand vehicles in China last year, an increase of 12.5% from a year earlier.

Volkswagen also operates a passenger auto-making joint venture with SAIC Motor Corp. in China.