Volkswagen AG is spinning off its performance-vehicle operations into a separate unit, Volkswagen R GmbH.

Similar to Audi AG’s Quattro GmbH operations, now more than 25 years old, Volkswagen R will specialize in limited-run versions of production cars the auto maker sells under the “R” brand. Currently, the lineup includes the 227-hp Golf R and 261-hp Scirocco R.

Volkswagen R will oversee development and sales of all R models, and the establishment of a separate entity signals more activity “mid- and long-term” surrounding sporty models, the auto maker suggests.

The new operation will be headquartered in Warmenau, Germany, near VW’s Wolfsburg headquarters and will be under the direction of General Manager Ulrich Riestenpatt gt Richter, who will oversee a staff of 350 people.