By on July 17, 2013

VW_Phaton_(2._Facelift)_–_Frontansicht,_7._Mai_2011,_Düsseldorf (1)

Having failed to learn from previous mistakes, Volkswagen is inexplicably bringing the Phaeton back to North America, despite being totally contradictory to their push downmarket to appeal to mainstream American car shoppers.

The Phaeton could return as soon as January, with an unveiling at the 2014 North American International Auto Show. According to Martin Winterkorn, the Phaeton is essential to Volkswagen’s plans for America.

“A brand as large as Volkswagen needs a halo project in the upscale segment…We’ve seen what happens to brands that don’t have that kind of project.”

A few things seem more pressing right now than re-introducing an expensive luxury sedan wearing a VW badge. For one, introducing a mid-size crossover (or two) should be a priority for VW, given its importance in the American marketplace. Figuring out where it will be made (along with the associated labor issues) is also a more pressing matter than the new Phaeton.

It’s also hard to reconcile how a premium sedan will fit with Volkswagen’s Americanized lineup of sub-$15k Jettas and Camry-fighting Passats. These products are being sold on the promise of value-for-money and other attributes Americans typically value. But other products, like the Passat CC, Touraeg and even to an extent, the Golf, are holdouts of the more “European” Volkswagen, featuring nicer interior materials, bolder styling and in some cases, higher price points. Despite attempting to re-jig their lineup towards the value end of the spectrum, VW still doesn’t seem to know what direction it wants to go in and sales are starting to reflect that. Inventories are high, incentives are abundant and its gotten to the point where layoffs are occurring at Chattanooga because of the slow paces of sales. Introducing the Phaeton will pull it increasingly in one direction. Whether it’s the right one is up for debate.

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140 Comments on “VW Repeats Patterns Of Bad Behavior, Revives Phaeton For North America...”


  • avatar

    So, when Hyundai sells Equus, it’s good, but when VW sells Phaeton, it’s bad. Is this the latest Ministery of Truth dispatch?

    • 0 avatar

      How do you come to that conclusion?

      • 0 avatar
        CelticPete

        It’s a reasonable conclusion because you claim that VW hasn’t learned from it’s mistakes. Thus VW introducing a high end car is a mistake – whereas its fine for Hyundai. Anyone would come to that conclusion..

        Assuming they already make this car in Germany – its trivial for them to import it. So it costs them little money. They simply put it on a boat.

        Sure a new midsize SUV is more important – but shipping the halo car to America for the very few people that want to buy it (probably only a half dozen a year) isn’t exactly a huge problem..

        • 0 avatar

          It’s far more than just “shipping it on a boat”. The launch of the car, which includes marketing campaigns, training dealers, training techs, federalizing it to meet FMVSS, and more is a very expensive endeavor. In the 8 figure region generally. Especially if, as you claim, a half dozen people per year will buy it, then this is going to be an expensive folly. The Phaeton has always been Peich’s (and by extension, Volkswagen’s) vanity project, and that’s one of the reasons the car was pushed through last time. It was a flop in America and it’s hard to see why it would be a success a second time around. It also flies in the face of VW trying to broaden its appeal to mainstream consumers in the quest for volume.

          What irked me about Pete’s comment was the insinuation that there’s some kind of party line that would cheerlead for the Equus while bashing the Phaeton. The Equus sells in miniscule volumes anyways. It’s never once cracked 400 units a month in America.

          • 0 avatar
            CJinSD

            Has an entire week transpired since the last time TTAC was accused of existing to promote VWs and Toyotas at the expense of Detroit?

          • 0 avatar
            jmo

            “In the 8 figure region generally”

            You are aware that the VW group makes 117 million euros every business day in profit… right?

          • 0 avatar

            Does that make them any more likely to spend 8-9 figures to bring an extremely expensive niche vehicle to a country with distinct regulatory standards and market tastes?

          • 0 avatar
            mike978

            “Has an entire week transpired since the last time TTAC was accused of existing to promote VWs and Toyotas at the expense of Detroit?”

            Detroit wasn`t mentioned, and another poster mentioned Hyundai. I agree that with the changes made last week there is no party line now taken. Derek is right to point out that is is going to be a vanity project, an expensive one for them. Has anyone shown that Hyundai is profiting (financially rather than reputationally) from the Equus?

          • 0 avatar

            “I think the Equus would not only excel in this field, but also offer a viable luxury option for the quietly affluent” — Derek Kreindler, 2012

          • 0 avatar

            Utterly asinine attempt at a “gotcha”. That quote was in reference to the Equus acting as a replacement for the Lincoln Town Car, not as a halo for a mainstream brand. I criticized the Equus for not living up to the standards of what one would expect from other competitors in terms of styling, interior materials or driving dynamics. It’s still irrelevant to the discussion; why bother with the Phaeton again when it failed the first time and there are more pressing matters for VW. Their sales are down, inventory is piling up, they lack a key product but they persist in bringing over a very expensive niche flagship. As far as the Equus goes, even if I liked the car in certain aspects, the sales figures do not validate my own tastes.

          • 0 avatar
            jmo

            “Does that make them any more likely to spend 8-9 figures to bring an extremely expensive niche vehicle to a country with distinct regulatory standards and market tastes?”

            Obviously, yes.

          • 0 avatar

            They don’t just throw money around wantonly despite immense profits. If what you suggest is true, why wouldn’t they have brought the Sirocco or Polo or other cars over by now? By your logic, the expense is trivial and who cares if it’s a money loser?

          • 0 avatar
            CJinSD

            “Detroit wasn`t mentioned, and another poster mentioned Hyundai. I agree that with the changes made last week there is no party line now taken.”

            My point was that TTAC is a prism in which people see their own persecution fantasies based on whatever brand oriented open wounds they bear. TTAC can’t be critical of any brand, because people have been conditioned by the sell-out media to discuss consumer products and related decisions in terms of good, better, best, and orgasmically brilliant. Derek was optimistically wrong about the Equus. How dare he learn from that mistake! It’s an outrage, I tell you. It isn’t like VW is repeating a behavior in the hope of getting different outcome at all. The problem is that Derek isn’t repeating his behavior from last year, mistakenly saying that anyone can sell a car for double the average transaction price.

          • 0 avatar
            snakebit

            The reason(stated by VW at the time)why the Scirocco hasn’t been exported to the States is that they thought that niche was weak(see Celica and Prelude) and what sales it would garner would subtract from GTI/R32 sales. As for Polo, when Yaris, Sonic, and Fiesta/Mazda2 take off, VW will reconsider that market.

            As for Phaeton, I’m not Volkswagen of America management, but if I were a dealer, I’d want to test the market by offering a few pre-owned current model Audi A8′s to see if that sort of buyer is thinking of shopping VW dealers for $100,000 sedans.

          • 0 avatar
            J.Emerson

            I’m not sure how Derek was “optimistically wrong” about the Equus. It met its sales targets, it provided an image boost to the Hyundai brand, and it succeeded in showing that Lexus does not have a monopoly on the market for high-quality, Asian-style luxury cars. More important than any of these things, though, it undoubtedly helped move more Genesis sedans out the door. The Phaeton did none of these things; it was an unqualified failure that did nothing but muddy VW’s brand image in the US as they sought to go mass-market.

            I guess if you’re locked into thinking that Korean cars are just a passing fad that will come and go as sure as the sun rises, that position would make sense. But if you’re not a member of Toyota or Honda’s executive board, I don’t know why anyone would choose to believe that of their own volition.

          • 0 avatar
            Turbio

            “You are aware that the VW group makes 117 million euros every business day in profit… right?”

            Right. And they’re that profitable because they don’t import every vehicle that gets slobbered over by dubbers on the internet.

        • 0 avatar
          Nick_515

          I don’t think so. Hyundai NEEDS halo projects – being up and coming and all – VW doesn’t. Derek’s conclusion in treating the Equus and Phaeton differently stands for me.

          • 0 avatar
            highdesertcat

            I agree. The two are mutually exclusive of one another and will draw totally different clientèle.

            That said, the Equus is very popular with older folks who like the ride and comfort, without the drama of a moniker from Mercedes, BMW, Lexus or Infiniti, and have migrated away from Cadillac and Lincoln.

          • 0 avatar
            ranwhenparked

            Good point, Volkswagen may not be exactly a premium brand on their own, but they have been pretty successful at trading on their German/Euro-snob appeal over the years to the point where most consumers already regard them as a superior machine. They don’t really have anything to prove.

        • 0 avatar
          APaGttH

          How do you draw the 1:1 comparison.

          Derek is pretty clear in his article. The idea of the Phaeton is not the mistake. VW has some gaping holes in its product lineup. This is the same company that partners with Chrysler to sell rebadged minivans with creepy Brooke Shields “MUST BREED FOR THE FATHERLAND!!!” ads.

          He rightly points out that you can’t call the CC a success (although it is clear to me that National and Budget sure do love them), they have gaping holes in their CUV/SUV offerings, and some of their products are overly priced (Eos, hello).

          A 2006 VW Phaeton W12 packed a sticker price of $106,000! Adjusting for inflation, the 444HP version would sell MSRP today for $123,000. For that kind of Cheddar, MSRP, I can buy two, count them, TWO base Equuses (Equues? Equii?).

          If VW really thinks they can sell a six-digit car with VW on the grille, when an Audi A8 isn’t that much Cheddar (heck adjusting for inflation you’re getting with a few tens of thousands to a base R8) likely on the same lot – game over man.

          An Equus ultimate is short 15 HP over the W12 Phaeton of the past. But here is the bigger issue. VW ended up blowing out those Phaeton’s at as much as a 50% loss to move the inventory out. They just didn’t sell. I don’t associate VW with a luxury marque (for that matter I don’t Hyundai either). But at least a base Equus is only 2X higher than the average new car transactional price at about $60K, and a Signature model is $66K.

          So I don’t see this at all as Hyundai good and VW bad.

          But I agree 100% with Derek that instead of building a low volume (come on you have to admit that) vanity vehicle that is going to cost big bucks to develop (luxury trappings) while not cannibalizing Audi sales just doesn’t make a lot of – sense. Filling their product holes in the CUV/SUV space, if they are truly committed to the NA market – THAT would make sense, and would reap better returns. Good profits to be had in CUV/SUV, with better sales volumes, and available platforms.

          • 0 avatar
            TonyJZX

            let’s say first that rich companies can afford to make expensive mistakes just to make them

            firstly this is hyundai’s first go at selling a large luxury limousine

            they are entitled to waste their money

            this is VW’s *SECOND* go at the Phaeton in the US

            they too are entitled to waste their money but its not directly comparable to Hyundai’s first go is it?

          • 0 avatar
            th009

            Assuming that the second-generation Phaeton will be priced the same as the first-generation is … well, a dangerous assumption. We won’t know for a while yet, but I personally expect a substantially lower entry price, and no W12 option (at least not in North America).

            And, yes, the three-row CUV is on its way as well.

          • 0 avatar

            I wonder if Phaeton makes some twisted sense because VW executives want to drive a luxury car, just as every GM division wound up making a luxury car in the 1970s because division heads were required to drive one of their products …

            I’ve actually seen two Phaetons in the Palm Beach area and a ton of CCs. Drivers here will buy pretty much anything if it’s unique and expensive.

            Unfortunately the Miami and Palm Beach markets are pretty much unique in the nation for this. (Housing is much cheaper here than in California, so the money Californians put into housing goes into cars here.)

            For the $100k+ market, though, I’d have a hard time beating the Tesla Model S as a unique and fresh choice, as long as you don’t need to go on lengthily road trips … so I’m really not sure how many customers there are for this, even here.

            D

          • 0 avatar
            DeadWeight

            Assuming the (non)reliability, level of dealer (non)service/concern, cost of maintenance & repair is on par with the last gen Failton, VW is exhibiting the textbook definition of insanity.

      • 0 avatar
        Windy

        How many did they sell first time around in the USA and how much money was actually lost? If it was a matter of not meeting sales projections and poor profits that caused them to quit back then…. Well perhaps making a few bucks on the model line including service profits by dealers on out of warranty cars makes it worth while to bring them back. If on the other hand the first introduction was a total washout with megabuck loses well then doing it again would seem to make little sense.
        If the training special service tools that dealers had to buy 10 years ago have any transfer value to the version to be imported next year that might also be a factor in bringing it back, might it not?

    • 0 avatar
      TMA1

      Hyundai doesn’t have Audi to sell upmarket vehicles. And the Equus is a relative value in that segment. The 2004 Phaeton started around the price of a loaded 2013 Equus (mid $60′s). The W-12 model in 2004 costs as much as new 2013 S-Class, over $90K. What’s so smart about that?

      • 0 avatar
        bd2

        This – along with the fact that the Phaeton looked like an oversized Passat (the Equus looks nothing like the Sonata).

        The Phaeton simply did not bring anything to the “value” equation in the segment unlike the Equus or the LS400 when it first launched.

        The Phaeton was only a few grand cheaper than the A8 (in today’s dollars, the Phaeton started around $76k) and VW didn’t offer luxury service like Audi does for the A8 (or Hyundai with the Equus).

        VW needs to keep the price of the new Phaeton down to around $60-70k, give it more distinctive sheetmetal and improve their service/amenities for Phaeton owners.

    • 0 avatar
      twotone

      The first generation VW Phaeton was a sales flop in the US. Very few Americans were willing to pay $50k — $90k for a car with the VW badge. So, VW stuck a Bentley body on them, tripled the price and every hip hop rap star wanted one. VW should keep branding cars for the masses and use Bentley or Audi as the premium brands.

    • 0 avatar

      Pete, I’d be very surprised if a base Phaeton will less expensive than a loaded Equus. I’m not convinced they’re really direct competitors, though the one guy I’ve spoken with who bought an Equus, a retired car designer, btw, said that he crossshopped the German brands.

      A loaded Equus is about $67K. In 2004, a base V8 Phaeton was $64.6K.

      When the Phaeton was introduced in the U.S. the last time, I thought, “Nice car, but Americans won’t buy an eighty thousand dollar VW”. I still think that’s the case.

      • 0 avatar

        Ronnie, that is all fine, as well as poor reliability and durability. Derek’s sin is that he did not write “Phaeton will fail again because it remains an overpriced junk” and give the numbers that you provided. Instead, he harped on bogus market positioning handwaving which Equus debunks with ease.

        • 0 avatar

          Two problems

          a) I don’t know the price of the new Phaeton will be.

          b) It may not be “overpriced junk” in the end.

          You condemn me for not crucifying a car that we have no information on beyond “it’s coming to our market soon”. My sin is that I didn’t write what you wanted to see written.

      • 0 avatar
        jpolicke

        Agree 100%. Especially in America, image is everything, and if you spend that much on a car you want people to know it. A Passat on steroids isn’t going to sell to these buyers. If VW wants a halo car they should put the XL1 into mass production. Rich people seem to love expensive toys to show off their green cred.

    • 0 avatar
      ash78

      Pete, I’ve been making this analogy since the Genesis was announced, and the Equus just adds fuel to it.

      VW suffered from bad economic timing and a terrible dealer network at the time (which has been since upgraded to “mediocre”)

      They MIGHT succeed this time around, since “quiet affluence” is becoming more the norm, and because VW’s reputation for long-term quality seems to be improving across the board.

      Still, as a VW shareholder, I would vote against this idea if I had any say. But I would have voted against Genesis and Equus for Hyundai, so what do I know?

    • 0 avatar
      Mullholland

      Derek was right about both the Phaeton and the Equus.
      Just look at retail sales. The Equus sold nearly 4,000 units in the US for 2012. The Phaeton’s US sales goal (which it never came close to) was 3,000 units.

    • 0 avatar
      Dr. Kenneth Noisewater

      How is the Phaeton not entirely redundant when compared to the Audi A8L ? Audi is VW’s luxury brand, Equus is Hyundai’s luxury _sub_-brand.

      • 0 avatar
        ash78

        This is generally correct, but for the last generation, the Phaeton was heavier, slower, and substantially more optioned-up, but for less money. A8 was like the aluminum-framed sport edition, in keeping with the VAG dual brand families.

        But in reality, most shoppers made the exact comparison you just did.

    • 0 avatar
      jmiller417

      The difference is that VW has a multitude of brands to handle high-end offerings.

      • 0 avatar
        CJinSD

        These things are Veblen goods. Nobody wanted one as a $65K VW. They’re desired by VAG’s customers as $90K Audis. At $180k they appeal to certain types of people when wearing Bentley badges. Why does VW keep wanting to upset their own apple cart? Eventually someone in the advertising business, I mean Car and Driver’s editorial staff, will slip up and mention that the Phaeton is a Flying Spur for the price of an Equus. Then the entire badge engineered illusion could crash down upon them, and raising prices might not restart the embarrassing cycle.

    • 0 avatar
      redliner

      You might have a point except for one thing: VW already has at least 2 other premium brands that sell “Phaetons”

      Selling a Phaeton as a VW is like selling caviar at Wal Mart. People who shop at wal mart aren’t looking for caviar. People who shop at VW dealers are’t looking for Phaetons.

      Hyundai, on the other hands doesn’t have any brands in the above $50k market, and wanted to avoid having to shell out money to set up a separate premium brand and distribution network. The Equus don’t steal sales from any other Hyundai product, and it’s drive train is not exclusive to just one car, meaning it’s easier to get it serviced at any Hyundai dealer.

    • 0 avatar
      Brunsworks

      The difference between the Equus’ base MSRP of $59,250 and Phaeton’s $65,000 (projected by Car and Driver) is dwarfed by the fact that Hyundai has steadily built its reputation to the point where they are now the bargain-basement automaker that expanded into a full lineup.

      Hyundai models also sell well across the board. VW, not so much.

      Also, it remains to be seen whether VW will try to market this the way they do with the Jetta, where you can indeed get a $15,500 car if you don’t mind it coming stripped down, or fully loaded with only one or two available options as Hyundai does.

      Essentially, the problem with VW introducing a Phaeton now has nothing to do with the fact that Hyundai introduced a competing car; it has everything to do with the fact that VW isn’t doing a good job of selling the lineup it has, which is something of a prerequisite.

    • 0 avatar
      pdg

      Surely the right comparison for VW/Audi is not Hyundai but Toyota/Lexus. Since Toyota (the company) already offers the Lexus LS, Toyota (the brand) would be silly to offer a higher price sedan.

      @jmo: I can’t figure out how you came up with your claim that VW made 117m euros per business day. Operating profit per business day in Q1, 2013 (assuming 13 5-day weeks in the quarter) was 36m euros. What time-period and what definitions of profit and business day are you using?

      • 0 avatar
        bd2

        Toyota offers another S Class competitor, the Crown Majesta, in Japan and the flagship sedan is the Toyota Century and not the LS (which used to be sold in Japan as the Toyota Celsior).

        So VW having its own flagship to compete against the A8 in its home market (and Europe) is not that unusual.

        The question is whether the Phaeton will sell in the US market and w/o a lower price, more distinctive sheetmetal and upgraded service, it won’t.

    • 0 avatar

      The difference between the Equus and the Phaeton is that VW already has a separate luxury brand. The Equus has a solid business case as a push upmarket, where margins are higher; the Phaeton makes much less sense in the grand scheme of the VW Group’s global presence: Why not an Audi instead?

      Imagine if GM showed a very nice over-the-top $75k Chevrolet luxury sedan. Surely we’d all be saying that they’d lost their minds: Why not up the trim a little more and make it a $90k Cadillac instead? It would make NO sense, and that would be instantly obvious to all of us. But we dither over the Phaeton because… it’s German?

      VW is the most profitable of the global automakers at the moment, and of course they can afford such a vanity project much more easily than GM can right now. But why do this? Why, when the whole company is hell-bent on the enormous goal of becoming the world’s top-seller by 2018? Why the expensive distraction?

    • 0 avatar
      Pig_Iron

      Since September 24th, 2001, TTAC has been totally anti-VW. I am so sick and tired of it, What’s next; accusations of spotty quality for the last three decades?

    • 0 avatar
      Domestic Hearse

      Pete,

      The Phaeton already failed here once before (good car, just the wrong brand).

      And VW has Audi sedans (and to some extent, Porsche’s Panamera) for their upscale customers.

      Hyundai doesn’t have a luxury division. If they want to be in the space, they’ve got to put their luxury sedan alongside Sonatas and Santa Fe’s.

      VW, when it sells a Phaeton, is only cannibalizing a possible Audi sale. It’s as if Chevrolet built a Cadillac CTS fighter. You’ve robbed Peter to pay Paul.

      Comparing the business models and strategies of VW vs Hyundai when it comes to launching a luxury car is a somewhat apple to orange comparison.

    • 0 avatar
      Sam P

      The Equus isn’t exactly a sales success. It sold at an annual rate of about 4k units in 2012 and is on track to sell around 3k units in 2013.

      http://hyundainews.com/us/en-us/Media/PressRelease.aspx?mediaid=38746&title=hyundai-motor-america-reports-best-june-and-mid-year-sales-ever

      Meanwhile, the more expensive S-Class and LS are outselling the Equus by 3-4x in terms of annualized sales.

      http://finance.yahoo.com/news/mercedes-benz-posts-best-second-163700916.html

      http://www.clublexus.com/articles/news/lexus-sales-increase-in-may-2013.php

      But if VW wants to burn money bringing the Phaeton here…more power to them. I’d rather see them put a diesel in the US market Tiguan.

      • 0 avatar
        bd2

        For 2013, the Equus has been hit with a supply crunch due to the switchover to the refreshed model.

        Also, not having AWD really hurts Equus sales.

        The next generation Equus will come with AWD and should do around 500 a month in sales.

  • avatar
    The Soul of Wit

    Why do I get the feeling that Baruth has called dibs on the review?

  • avatar
    thelaine

    Nice looking sedan.

  • avatar
    VanillaDude

    When the European market continues to soften, what does VW do with cars they designed for the European market? Try to sell them here!

    The goal is to outlast the other guy. If VW can hold on while other makes suffer and die, then selling European VWs in the US when they couldn’t find buyers in Europe just may be an edge.

    • 0 avatar
      WaftableTorque

      Nice seeing you back. Even though I thought your Nazi-post ban was well deserved.

    • 0 avatar
      DC Bruce

      One of the factors that people in this thread apparently fail to account for is a manufacturer’s need to keep a particular factory ticking over and making product. If, as you suspect, VW is selling fewer of these in Europe (a reasonable speculation), then it does make sense to try and sell them here to maintain a minimum level of production in the factory that builds them.

      As for the “failure” of the previous introduction, at least half of it should be attributable to apparently abysmal reliability together with poor and expense factory service. People will probably tolerate that better in a Jaguar than in a VW. One would hope that, with the passage of time, a lot of these problems have been addressed.

      If you’re into “understated elegance,” this car has it.

    • 0 avatar
      carguy

      Welcome back VanillaDude!

    • 0 avatar
      Mullholland

      This comment is spot on. Good to see you back in the loop.

  • avatar
    otter

    Paging Jack Baruth….maybe he can order one in Kermit Green this time.

  • avatar
    turbobrick

    The spring-loaded ashtrays better be synchronized this time!

    • 0 avatar
      BMWnut

      It takes a truly obsessive owner to complain about things like the two ashtrays in the console not opening at the same rate. But the VW factory still came up with a fix. The problem was caused by the radio above the ashtrays being a few thou out of line. Refitting the radio (with the aid of a micrometer I guess) fixes the problem.

      That said, my first thought on seeing this was thay would probably decontent the Phaeton to sell at a lower price point, like they did with the Passat. Such a car would have what was called staggering attention to detail by an overpaid British TV presenter.

      • 0 avatar
        ranwhenparked

        That would make sense to do that. It wouldn’t be a bad thing for Volkswagen to maybe have a more attainable flagship sedan like the Maxima, Azera, Avalon, Taurus, Impala, or Charger – bigger and slightly pricier than the Passat, but more accessible than the old Phaeton. Volkswagen is following a “more volume and market share at any cost” strategy in the US right now, and a fuller product line would help with that goal. That won’t happen though, the Phaeton is a true luxury car and is going to stay that way.

  • avatar
    Wheatridger

    Although I tend to agree with the premise of this article, the headline carries as much spin as a major-league curveball. The “patterns of bad behavior” are called out, but unspecified here (cost-cutting? brand striving? failed window regulators?) This story reminds me of the dark days of the Ancien Regieme. But it’s ok, I understand– patterns of bad behavior are hard to break.

    • 0 avatar

      The one I was refering to was trying to move upmarket, then going mainstream then going back upmarket again. My one VW ownership experience was trouble free but everyone around me seemed to have nothing but problems with their cars.

      • 0 avatar
        APaGttH

        And with the Audi brand there is zero reason to go up market. This would be like Chevrolet trying to sell a $90K Cadillac grade car. It makes no sense. If people want a German upscale car made by the VW parent, it’s called an Audi.

    • 0 avatar

      The one I was referring to was trying to move upmarket, then going mainstream then going back upmarket again. My one VW ownership experience was trouble free but everyone around me seemed to have nothing but problems with their cars.

  • avatar
    jfbramfeld

    I find marketing discussions a lot less interesting than those about the actual cars, but while we are on the subject, maybe someone can explain the difference between a car’s price and its “price point.”
    John

    • 0 avatar
      highdesertcat

      It’s too elaborate a subject to get into here. Books have been written on both subjects and courses in them are taught at both the undergraduate and graduate college levels as part of a macro/micro economics curriculum, a marketing/advertisement curriculum and, of course, the MBA curriculum.

      • 0 avatar
        jfbramfeld

        I think you may be right. On the other hand, it may be the two words are better than one syndrome.

        A third possibility is that you don’t want to say “$40,000? They can screw themselves.” when you could instead say “My, that is certainly an inappropriate price point.”

        John

        • 0 avatar
          highdesertcat

          The short answer is that the car’s price is set forth in the MSRP, while the car’s price point is the category or price class a manufacturer wants compete in with that car.

          A multitude of variables are entered into to derive each.

          And that is before anyone factors in the demand for such a vehicle that would cause the dealers to sell that vehicle over and above MSRP, OR, at a steep discount.

          Example is the Jeep Grand Cherokee. It competes at the $30K price point, the$40K price point, the $50K price point, and the $60K+ price point, many Grand Cherokees at all price points sell well over MSRP (because there is great demand currently for them).

          So the question here remains, what makes this Phaeton worth $XXXXXXXX to a buyer?

          Exclusivity is one thing. Niche another. Profit margin yet another. Social/class status, maybe?

          So the questions generated by the short answer require replies longer than the entire article.

          • 0 avatar
            jfbramfeld

            Your example is this:
            “Example is the Jeep Grand Cherokee. It competes at the $30K price point, the$40K price point, the $50K price point, and the $60K+ price point…”

            This example would mean exactly the same thing if you took the work “point” out. In fact, it would be even better if each “price point” were removed. For example: It competes at $30,000, $40,000, $50,000 and $60,000.

            John

          • 0 avatar
            highdesertcat

            I should have elaborated.

            The $30K Grand Cherokee competes with the Traverse et al at the $30K price point.

            The $40K Grand Cherokee competes with Enclave et al at the $40K price point.

            The $50K Grand Cherokee competes with luxos at the $50K price point.

            And so on, up to and including similar vehicles at the higher price points, like Mercedes and LR.

            Each version of the Grand Cherokee is more closely aligned with the similar vehicles that compete at the same price point.

            While the body shell and drive train remain pretty much unchanged throughout all the price points, the trim levels and equipment more closely match those of the competition within each price point.

            My wife’s Overland Summit is a totally different vehicle than my buddy’s Laredo.

            As to what determines price point? That is closely tied to the sales philosophy and marketing strategy of the manufacturer.

            I used the Grand Cherokee as an example because of its wide range of competition, but I can’t envision a stripped down Land Rover competing at the Traverse price point, or a dolled up Highlander competing at the Land Rover price point.

  • avatar
    Wheatridger

    Maybe a headline like “Return of the Phaeton: Flagship or Flop (The Sequel)?” would have been more appropriate?

    And please, just this once, can we keep reliability issues out of the story? That’s another bad habit of this and every online forum, to turn every VW story into an account of everybody’s repair stories. At least when the Phaeton breaks, the owner can just drive one of his spare Porsches while it’s in the shop.

    • 0 avatar
      TMA1

      They could make the spare Porsche a no-cost option at the Phaeton’s price point.

    • 0 avatar
      DinosaurWine

      Keep reliability issues out of the story? Sorry, but one of the major flaws with the last Phaeton was its meteoric depreciation, even among its competition. At least part of that was the fact that the car had an absurd amount of sensors, pumps, solenoids, and motors which were designed to last through the warranty period and that’s it. And pretty much all of them cost $2000 to fix.

      This is just VAG badge engineering at its worst. Just sell the car as an A8 and be done with it.

      • 0 avatar

        800k units by any means necessary

      • 0 avatar
        Wheatridger

        What does reliability or depreciation mean to the top-end buyer? Phaeton buyers will probably lease, and move on to the next new flavor within a few years. You might feel sorry for the third and fourth owners who will pick one up well-used for Jetta money and struggle to maintain it, though. But rich folk buy Land Rovers, Jaguars and whatever else tickles their fancy. They don’t require long-term durability; they won’t drive their Phaetons “until the wheels fall off.”

        I suspect you might be surprised at how many sensors, pumps and solenoids are present in the cheap cars, too. All built to a price.

        I don’t have time to speculate about the future reliability of a car that I’ve never seen and will never own. Either you’re conjuring up facts you can’t know, or you’re speaking with the deep, eternal hatred for all VWs that infects this forum’s readership. For my part, I hate pickup trucks, every brand and every one of ‘em that’s not earning its keep hauling stuff around to the farm or job site. But I don’t waste time sharing that in truck forums, picking fights.

        • 0 avatar
          APaGttH

          The rich get rich by being cheap. If you have crashing depreciation, unless you subsidize the lease, you’re not going to get a good lease deal. If VW subsidizes the lease, then they don’t make profit. SOMEONE becomes a loser in the math. You can see Mercedes in particular propping up lease rates on some of their models. The depreciation math and capitalization costs don’t add up when you do the lease math on their deals. Ditto on the 2013 Camry as another example, and to bash the big three, ditto again on a Chevrolet Volt.

        • 0 avatar
          DinosaurWine

          “I don’t have time to speculate about the future reliability of a car that I’ve never seen and will never own. Either you’re conjuring up facts you can’t know, or you’re speaking with the deep, eternal hatred for all VWs that infects this forum’s readership.”

          I don’t hate VW, they’re just not reliable. Sorry if that offends fanboy sensibilities out there, but I hear a lot more people having horrendously expensive repairs than going for 200,000 trouble free miles when it comes to VW. And no, lax American attitudes towards automotive maintenance are not the culprit, unless there is some sort of preventative maintenance on coil packs and window regulators that I am not aware of.

          • 0 avatar
            krhodes1

            But Wheatridger gets it exactly right. This is IRRELEVANT to the target market of $75K+ sedans. They. Simply. Don’t. Care. Ditto the difference in lease payments due to more or less depreciation. To most folks in the market for this sort of thing, the difference between a $1000/mo lease payment and a $1400/mo lease payment is less than rounding error.

            NO ONE is ever going to buy a Phaeton and drive it 200K miles. They are going to lease it for 3 years max, then lease another one. Or something else new and shiny.

            Don’t feel sorry for the subsequent owners. Anyone who buys a well-depreciated $100K car who could not afford to buy it new is monumentally stupid. If you can’t afford the payments on a new one, you can’t afford the maintenance and repairs on a used one. Though in reality, repairs and maintenance will not cost anything like what depreciation on a new one cost someone.

  • avatar
    WaftableTorque

    The kool-aid from the fanbois tell me that…
    -there are virtually no differences in the quality of cars any more
    -diesels are now clean
    -this is the best handling 911 yet, the last model was so woolly at the limits
    -Japanese make boring vanilla with no soul for boring people with no soul
    -cars no longer rust because of advances in corrosion protection
    -Volkswagen and Audi lead, everyone else follows

    These are things I heard between 1998 and 2003. I now hear in 2013 that:
    -there are virtually no differences in the quality of cars any more
    -diesels are now clean…

    • 0 avatar
      onyxtape

      See amusing threads in the Subaru Outback thread yesterday about how people would rather buy a Jetta wagon than an Outback for reliability reasons alone – despite Subaru getting the top manufacturers nod from Consumer Reports for at least the last several years in a row since the late 2000s.

  • avatar
    PrincipalDan

    Well if they put the V10 TDI from the Toureg in there we just might have something to lust after!

    What? You say they cancelled the V10 TDI because it was too dirty? Sigh.

  • avatar
    suspekt

    I dont see the problem with this article the others are pointing out.

    Derek doesnt even cite the Hyundai in his peice.

    It could be that Volkswagen wants this car in the showroom. They don’t really have any significant sales aspirations and I highly doubt moving 500 units in a 2 year-run will break-even for them. But, they can place it in advertising and use the model as psychological leverage in the showroom. It is a display of craftsmanship.

    I do like VanillaDude’s assertion that they are attempting this move to counter softening European sales, however that is speculative at best.

    • 0 avatar
      Kyree S. Williams

      True enough, but I’m sure that any old fool could see the difference between the Phaeton-to-be and the barebones products that Volkswagen’s lower-end is kicking out.

      Then again, I could be wrong…

  • avatar
    Lampredi

    And here I thought Ferdinand Piëch was the kind of person who would never tolerate anyone making the same mistake twice, yet now it seems he’s about to do so himself…

  • avatar
    daviel

    Nice car

  • avatar
    JD321

    The Equus is selling pretty well for Hyundai….

    It is stupid that they don’t have a competitve CUV in the CR-V/RAV4/Escape space. Build it in Mexico and automatically have free trade with all of the Americas.

  • avatar
    bumpy ii

    “We’ve seen what happens to brands that don’t have that kind of project.”

    Which brands, and what happened to them?

    The big difference between Hyundai and VW is that Hyundai built their ladder gradually, one step at a time. The Sonata was in the US for more than a decade before the XG came over, then about 6 years for the Genesis, then a few more years for the Equus. VW’s approach was to glam up the Passat a bit, then throw an S-class fighter on it.

    Also, upscale VW’s are sold in the US at the Audi dealer.

    • 0 avatar
      onyxtape

      “Also, upscale VW’s are sold in the US at the Audi dealer.”

      That’s interesting – didn’t know that. But wouldn’t most shoppers assume they were trade-in’s?

  • avatar
    forraymond

    The Phaeton is a great car. They should market it as a budget A8.

    • 0 avatar
      rnc

      Not a budget A8, but a step up the ladder, an A10 is what it should have been all along, I mean if this is just a bentley in VW clothing at a much lower price point, then it would fit quite nicely above the A8 with the W12 and all (and then it would sell, or as I said is PSA went under and VW could pick the citreon name, this would make for a good building block of that’s brands rebirth). VW doesn’t need to americanize thier cars, they need to do what ford is doing, buiding the euro sedans here or in mexico so that they can be sold for a profit (the $1 =’.08 euro means anything built in europe that isn’t upscale has to be discontented to profit.) In terms of tennessee, unionination there of and co-determination in Germany and such and how that is impacting production decisions there, the union only has 45% of the board seats, and IG Metal negotiates accross entire industries they represent (i.e. all autoworkers get .x raise over y years). they can’t single out VW, (well they could but pulling on the the golden gooses tail doesn’t seem like a good idea), have to believe that things have worked out so well for IG and the workers they represent, that they really aren’t worried about a single plant in Tenn. (bob King sure is) especially since they’re the one company in the EU that doesn’t currently seem to have capacity issues. But the Phaeton should be the A10 in the US and Audi would have another printing press.

      • 0 avatar
        Kyree S. Williams

        I was thinking Volkswagen would tone it down a bit and—in line with corporate cost-cutting—that this Phaeton wouldn’t be as nice as the last one. Making it an Audi A10, then, would probably push it well and beyond what VW Group had intended in the first place (considering the price-point at which the A8/S8 sputters out) and would guarantee fewer sales. Still, premium Volkswagens at any price-point aren’t really *in* at the moment, and there are more pressing and profitable priorities…like a seven-seater crossover.

  • avatar
    hf_auto

    I don’t really understand the point of this release. The original Phaeton, though not a sales success, was clearly a halo car. It was an impressive piece of engineering that (actually or potentially) elevated the brand image of VW regardless of whether or not they sold any.

    It is my understanding that the current Phaeton is a 3-year old facelift on an 11-year old car. Nothing about that says “halo” to me. It might be the nicest VW, but it’s not the engineering marvel it was in 2002.

  • avatar
    hreardon

    I imagine the meeting between dealers and Winterkorn went something like this:

    DEALERS: “Herr Winterkorn, we need some competitive CUVs, we need the new Golf and GTI sooner rather than later, an updated CC, a less expensive Touraeg, a better contented Passat and a new, more competitive Jetta! The market, especially in the CUV and compact segment, has become really competitive and we’re losing sales to Honda, Mazda and even the American brands now!”

    WINTERKORN: “I understand your frustration, and GOOD NEWS! We’re bringing profits back to you in the form of the Phaeton while we work on all those other products that you may not get for another two years because the market evolved faster than we thought, but our business plan will not be adjusted and product development sped up because damned the torpedoes and full steam ahead! Now sell me 600,000 Volkswagen branded cars per year…or else!”

    DEALERS: “Didn’t we have this EXACT same conversation in 2003-2004?”

    This whole thing reeks of Winterkorn having little good news for the dealers apart from “something”, and that “something” was the reintroduction of the Phaeton. I have to imagine that there are some very perplexed financial and product planners in Herndon scratching their heads right now, along with a bunch of dealers asking how much incentive money will back the reintroduced car.

    But hey, it’s not like the Germans are prone to not learning from previous mistakes, right?

  • avatar
    carguy

    It’s all about getting rid of excess inventory caused by the Euro recession. Will they be discounted? Yes. Will VAG care? Probably not as long as they move metal.

    • 0 avatar
      hreardon

      @carguy -

      That’s what I thought originally, but upon closer inspection the Phaeton being reintroduced to the US is a completely new model.

      • 0 avatar
        carguy

        Good point. But I doubt that VAG is seeing the end of the Euro recession anytime soon and, in order to keep the factories running, they are probably planning ahead to have greater flexibility in disposing of stock they can’t sell in Europe. I may be wrong but, given their recent mass market direction, I really can’t think of any reason why they would want to do this.

        • 0 avatar
          hreardon

          My hope, for their case, is that they have a better positioning plan for the reintroduced Phaeton. Since it will be a new model, perhaps they’re setting it up to pick up where the CC leaves off in the mid-$40s through mid $60s.

          Would I take a Phaeton II over an Audi A6 at that point? Not in a million years, but one would hope that Volkswagen has some kind of strategy that somehow differs significantly from the last go ’round.

          All that being said, and I do understand the arguments that can be made for brand positioning, etc.; I honestly think that this is a misplacement of resources if they’re pushing ahead with this project. I wouldn’t say it’s a completely wrong-headed-bad-decision…just oddly timed.

          Now according to some other reports, Volkswagen is looking to show ‘something’ at Detroit in January in order to gauge customer interest. This is probably the first in several trial balloons being floated to get a better sense of what the market demands and will support.

          Back to my earlier point: focus on the core of the brand and speed up the release of the core product updates starting with a true RAV4/CRV competitor, following up with substantially upgraded Passats and Jettas to remain competitive.

          • 0 avatar
            Kyree S. Williams

            Thank you! I don’t know where they get off selling that hideous, underpowered and tiny Tiguan for what they do, but it’s no wonder that there are few takers. The Passat could at least gain projector headlamps like every *other* midsized car on the market—except for the Malibu LS—and maybe it wouldn’t kill ‘em to throw in a few more features as standard. And the Jetta excels in rear-seat room and low base-prices…and nothing else. Meanwhile, no one is buying the Touareg, but Volkswagen thinks it can add an even pricier model to the lineup, for which there will be Audi *and* Porsche products within the same price range.

            Have they learned *nothing* about Americans and badge-snobbery?

  • avatar
    Wheatridger

    There might be one little reason a Phaeton might do better this time around. Ten years ago, the Passat was such a lovely, well-equipped car– an Audi without AWD, really. There wasn’t that much the Phaeton could add to that package. In this era of decontented VWs, a Phaeton would look and feel much more upscale than today’s Passat (have you sat on Passat seats lately? They seem to be made of wood planks). So there’s more room at the top of VW’s range.

    But nobody’s saying if it will be the same Phaeton, or a new one. If VW reintroduces a 10-year-old design, unchanged, into the premium market, that must rank as the boldest and most unlikely move in a long time. I’d hope it succeeds and starts a trend, though, ‘cuz I think all cars looked better 10 years ago.

    • 0 avatar
      vaujot

      This is fundamentally the same design as last time. There’ve been to facelifts, according to Wikipedia but that’s is.
      I hear that the Phaeton is actually a very nice car and used ones can be had cheaply.

    • 0 avatar
      vaujot

      This is fundamentally the same design as last time. There’ve been two facelifts, according to Wikipedia, but that’s is.
      I hear that the Phaeton is actually a very nice car and used ones can be had cheaply.

    • 0 avatar
      vaujot

      This is fundamentally the same design as last time. There’ve been two facelifts, according to Wikipedia, but no fundamental redesign.
      I hear that the Phaeton is actually a very nice car and used ones can be had cheaply.

      • 0 avatar
        Kyree S. Williams

        As early as 2011, I was hearing rumors that Volkswagen was going to reintroduce the Phaeton; however it was a redesigned model that would scale back somewhat. The days of the current Phaeton are probably numbered. Despite the facelifts and psuedo-redesigns, it no longer fits Volkswagen’s design language, and the days of basic shapes dominating designs are over, as Nissan has surely learned by now. Even an anonymous flagship will have to adopt some kind of flashiness in this day and age. I seriously doubt—as bold as they are—that they would re-release *this* one.

        And Phaetons only make good pre-owned cars if you’re in really good with a VW/Audi specialist/garage *and* you aren’t depending on one as a daily driver. Remember, this is the car that shares its mechanicals with a Bentley.

  • avatar
    CoreyDL

    Kids kids!

    Do you wanna buy an A8, but with a more plebeian badge?
    Do you want to have higher depreciation than the A8, while simultaneously having a worse dealership experience?
    Would you like a bunch of electronics and trim which are only for your car, which will undoubtedly be pulled from the market again in 2-5 years?
    Do you want passers-by to think “Boy that was a big Passat!”

    Have we got a deal for you!

  • avatar
    mcarr

    Can’t believe I’m the first to say this in this comment string..

    Looks like a Passat.

  • avatar
    FractureCritical

    I really don’t understand the logic here other than they have the car, so why not import it? Anyone who’s got that kind of coin to spend is likely going to go with an established luxury brand and all the premium service care, loaner cars, and shopping mall parking lot badge envy that implies. I suppose there’s some room for the idea: VW does seem to be sucessful with the Tourareg, which is ostensibly also a $60k car in VW clothes. It’s certainly not that much more of a stretch to go with something like an Audi Q7, but people seem to buy it *shrug*

  • avatar
    Kyree S. Williams

    It seems rather silly to me. Remember that no one is buying Volkswagen’s other premium product, the Touareg. I’m pretty sure the Porsche Cayenne and Audi Q7 both outsell the Touareg, and I’m pretty sure that the Bentley Continental outsold the Phaeton while it was here.

    • 0 avatar
      suspekt

      The Toureag is the best looking of the bunch to my eye.

      Cayenne looks cheap (even with all the Turbo and GTS glitz) and the Q7 looks okay.

      But the Toureag in full S-trim, that is a sharp SUV.

      I place the Toureag and the MDX (last gen and new gen) at the top of the styling department. Honourable mention to the new MB GL in sport package guise… man does that thing look good

      • 0 avatar
        Kyree S. Williams

        I like the Touareg better as well, with its cleaner styling and simpler shapes. However, the majority of buyers would clearly rather have a Cayenne. I myself wouldn’t even look twice at the Q7 until it gets updated like the Touareg and Cayenne; it’s now very long in the tooth. I’m a major fan of the muscular, outgoing MDX. I didn’t like the pictures of the new one when I saw it, but all of a sudden it looks very handsome, especially when compared to the awkward Infiniti JX/QX60 and portly Buick Enclave. The new Mercedes-Benz GL looks excellent in any trim, but I most like the one that comes with the open-pore wood trim. It might be “Designo” or something like that. The other vehicle I’d toss into my favorite SUV’s category is the ubiquitous E70 BMW X5…but I have mixed feelings about its upcoming F15 replacement styling-wise.

  • avatar

    While they are busy federalising for and importing to the USA, could they toss a few Sciroccos into the mix, please? They seem to believe we don’t want the Scirocco or that it would cannibalise sales of GTIs, yet they plan to bring the GTD here. I am confident they would sell more Sciroccos than they will Phaetons.

  • avatar
    Battles

    Good original article made brilliant by the comments.
    More like this!
    Good to see some old commenters back, too.

    The Phaeton is a Peich vanity project, so what?
    The XL1 is another Piech project, some VW muscle flexing to keep the other players honest and busy catching up.

  • avatar
    epc

    Good article. It’s more interesting to read car stuff that is more than just driving impression reviews. Anybody with a driving license and a computer can do that.

    FWIW, I found Derek’s article to be entirely reasonable in its title, thesis and supporting arguments. I fail to see why some commenters seemed to find so much wrong about it.

  • avatar
    wmba

    Ferdie Piech noticed the nearby opaque wall in the glass emporium wherein Phaetons were being lovingly assembled by white coat-and-glove attired technicians from premium VW/Audi parts, sourced from local and global suppliers. Open-mouthed tourists gaped from the higher galleries as the precision assembly of the VW uber-machine took place before their very eyes.

    “Zehr gut!” exclaimed Ferdie, as he strode purposefully towards the wall. Once there, he banged his head hard on its stylish marble surface a couple of times until the familiar ringing began. “Fetch Winterkorn!” bellowed the tribal head of the VW/ Porsche/Audi Mega Empire.

    “I have a brilliant idea! As usual! The stupid Amerikanischers did not understand the utter technical brilliance of the Phaeton when we offered it to them less than a decade ago. Luckily for them, I have decided they will be given one more chance to appreciate automotive nirvana. Release the Phaeton to the US market at once! They must be made to understand that our best car is the best car in the world! We shall market this car forever until full obedience and supplication has been obtained from the dumkopf consumers of America!”

    With his head still tingling from the head bashing, Ferdie strode off to his harem, a sly smile on his face. One more decisive market decision made in only two minutes. Yup, he still had the chops at 78. This is MY empire, nobody else’s, he exulted to himself, and I am in charge of these difficult but logical marketing decisions. Nobody will replace me as the Chief of chiefs until VW achieves complete world domination, in 18 months or so. Toyota, GM, you are merely grist for my mill.

    And so it came to pass. Serried ranks of Panzer Phaetons soon occupied the front lines of VWoA dealer lots, displacing the vapid Touaregs and proudly displaying their Germanic orange-peel paint as counterpoint to the perfect finish of the Hyundai Equus down the street.

    Months passed, then a year. The Phaetons remained staunchly in place, guarding the entrances to dealer lots in stolid silence. Then one day, harried gofers were dispatched from the washing bays of the dealers on orders from VW World headquarters. With fumbling fingers, they tied helium-filled ballons with light cord from the wiper arms of all the Phaetons. The balloons, in variegated colors, towering 15 feet above the cars as they bobbed in the wind, all had the same printed message emblazoned on them.

    ONLY$449/mo OAC!

    That night in Wolfsburg, Piech fired Winterkorn for gross incompetence. “There is no excuse for gross marketing errors in my empire!” he informed the cowering executive. “I see I shall have to take over those duties again!”

  • avatar
    dartman

    …The Curse of The TTAC Editors continues…Derek, A wise Texas pig farmer (Carroll Shelby?) once said; “If you wrestle with pigs in the slop, it won’t take long for you to realize that they are enjoying it and you are not…”

  • avatar
    Lie2me

    Maybe if somebody asked VW why instead of bickering… Oh wait..

    “A brand as large as Volkswagen needs a halo project in the upscale segment,” Chief Executive Officer Martin Winterkorn told Bloomberg at a conference in the company’s hometown of Wolfsburg earlier this month, confirming that the Phaeton will return to U.S. showrooms. “We’ve seen what happens to brands that don’t have that kind of project.”

    • 0 avatar
      Lie2me

      …I wonder what there marketing strategy is?… Oh, look…

      “The Phaeton, the brand’s most expensive model, could be shown to U.S. consumers in January as VW prepares the car’s return after pulling it seven years ago because of weak sales. The reintroduction, which would complement the rollout of new sport-utility vehicles, is aimed at showing off VW’s engineering prowess as the lift from the mainstream Passat sedan fades.”

    • 0 avatar
      sportyaccordy

      VW has halos. Various halos. The A8, the Panamera, the Continental. They make great profits and speak highly of the group. VW has a problem in that it isn’t moving enough Jettas and Passats. Bringing back the Phaeton won’t solve that. Put the ego to the side and get money… that is how you do business.

      • 0 avatar
        krhodes1

        VW already has plenty of money – they can afford ego. Don’t forget too that the owners do actually run the show… Piech really doesn’t have anyone to answer to but himself. He’s “family”.

        • 0 avatar
          sportyaccordy

          If they could afford ego they wouldn’t have discontinued the Phaeton in the first place. It won’t bankrupt them but it’s a waste of time and money. If Peich wants a VW badged Continental he should just get a custom one made and leave it at that. But the hubris of thinking anyone else would want one after the world demonstrated it clearly didn’t, AND the fact that this would be in direct competition with other VWAG cars, is just a little too silly for me. Sometimes you have to leave well enough alone.

  • avatar

    That’s cool, it means I can afford a used one in 5 or 6 years after somone else has eaten all the depreciation and fixed all the fiddly bits.

    • 0 avatar
      28-Cars-Later

      I like your thinking as I employ a similar strategy, but for this to work the car has to be reliable and of high build quality. Not so sure on the Phaeton (or of any other high end VAG).

  • avatar
    The Heisenberg Cartel

    If they reposition it, drop the target a bit and aim it at the Equus, I see no reason it won’t succeed. If they try to do the same thing a second time, forget it.

  • avatar
    kurtamaxxguy

    If (more likely when) VW reintroduces the Phaeton to the USA, will they sell it at all VW dealers, or (like Chevrolet with the Corvette, and Nissan with the GT-R), __only__ sell Phaeton’s in their most elite, “superior” dealers? There remain a number of rather shabby VW dealers out there, both sales and service wise.

    For that matter, does Hyundai also restrict Equus sales to its elite dealers?

  • avatar
    pacificpom2

    This almost lets me believe that GM will import the Buick Park Avenue and HSV tweaked Chevrolet SS’s

  • avatar
    Ubermensch

    Incompetent and rude VoA dealer service can be tolerated when you are bringing in a a Jetta, but won’t be tolerated by someone bringing in a re-badged Bentley.

  • avatar
    billfrombuckhead

    VW didn’t get to be a challenger for world leadership in the car business by quitting easily. Armchair CEO’s and pundits can criticize but VW keeps rolling upward.

    I noticed watching my favorite TV show “Borgen” that the statesminister was being chauffeured around in a Phaeton. This VW is a perfect government car for Euro leaders when an Audi or a Mercedes is too much.

    BTW, it’s a damn good looking car much better than Asian imitations of German cars like Lexus Ls and Hyundai. It will help VW’s style language gain acceptance and get the public’s thinking up about VW in general.

    BTW, didn’t JapanInc lose money on Lexus for over a decade?

  • avatar
    cgjeep

    VW stated that they are going to revive the Phaeton name for NA. They didn’t state that it would be the same uber luxury vehicle with a 100k price point. Might just bring it in as a larger Passat, a Toyota Avalon/Hyundia Azera fighter.

  • avatar
    Kristjan Ambroz

    Another point to be mentioned is that Federalizing the Phaeton may be a fairly low investment this time around. The current Phaeton is just a facelifted version of the already Federalized one, so the costs may well be significantly lower than one would incur if bringing a completely new and as of yet unfederalized product to the US, such as the Scirocco or Polo.

  • avatar
    MinPVD

    why wouldn’t they make this an audi?


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