By on September 23, 2014

1280px-VW_Phaton_(2._Facelift)_–_Frontansicht,_7._Mai_2011,_Düsseldorf

Hot on the heels of Volkswagen’s apparent plans for a Chinese-market luxury sedan, Automotive News is reporting that Volkswagen’s next-generation Phaeton, destined for the American market once again, will start at $70,000.

According to AN, the next Phaeton will include a plug-in hybrid, as well as a V8 TDI engine. A W12 is also expected to make a return, though this will likely not be sold in the United States.

Despite sorely needing a larger crossover and a refresh for key products like the Jetta, Volkswagen is persisting with their dream of selling a high-end sedan in the United States, at a price point that is encroaching on their premium marques like Audi and Porsche. The Phaeton, for all its engineering excellence, was a massive flop in the United States. 

On the other hand, the product VW most sorely needs in America, is conspicuously absent from their lineup, and VW has only just settled on where it will be produced, after a round of serious horse trading and internecine squabbling. The Phaeton, according to AN, has apparently been completed already, but VW seems content to continue the current car’s production run, owing to its popularity in China.

This, dear readers, is a great example of how the company continually seems to misunderstand the American market. Rather than get to work on plugging the biggest hole in its lineup, the company persists on a fool’s errand masquerading as a vanity project.

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63 Comments on “Volkswagen’s American Phaeton Will Start At $70k, Will Surely Fail Again...”


  • avatar
    28-Cars-Later

    Tough call: Phaeton or ELR for $70K which do you choose?

    • 0 avatar
      Volt 230

      Phaeton, at least it’s based on another luxury car, not some compact family sedan.

      • 0 avatar
        28-Cars-Later

        I’d have to drive both but I’m leaning toward Phaeton for the TDI V8.

        • 0 avatar
          Toad

          The TDI V8 sounds nice on paper but the TDI V10 (and surrounding electronics) in the Tourag were a nightmare. Are you willing to bet $70,000+ the new diesel in the new Phaeton will be better?

          Owners of the Phaeton W12 will tell you getting it serviced was virtually impossible; virtually no trained techs, parts, or support. It is safe to bet that another low volume engine in a very low volume, complex car from VW is something to stay away from.

          Too bad.

          • 0 avatar
            tuffjuff

            @Toad,

            I’m surprised that VW didn’t require dealerships that sold the Touareg W12 to be certified to service it, first, ala Nissan GTR… but then I remember: VW. I flirted with getting a V6 Touareg TDI but I can’t help but feel like it would be a nightmare to own, for some reason. That engine is pretty tested from what I hear, but for some reason it feels like the vehicle would be broken, often.

          • 0 avatar
            Toad

            @tuffjuff

            All franchise dealers are required to be able to service the manufacturers entire lineup. But with a low volume model they will only send one or two service techs to be trained on that vehicle, and if they almost never see one the training gets forgotten quickly.

            Plus the service techs don’t get enough experience to do the work as fast or faster than the book rate, so they really don’t want to work on your one-off Phaeton at all; with the oddball car they are more likely to get paid for less hours than they worked and/or get hit with penalties for not doing the job right and having to re-do the work. So when you Phaeton goes into the shop everybody (service writer, service manager, parts manager, service tech) treats it like it is radioactive.

            Then there is the issue of stocking parts for rare cars with optional powertrains…

          • 0 avatar
            BMWnut

            Then there is the possibility that the one tech that spoke Phaeton now works at a Bentley dealership in a different time zone.

      • 0 avatar
        ellomdian

        You mean the one based on the new MLB Evo platform? The one that underpins the A4?

        Yeah, that’s certainly not a small family sedan.

    • 0 avatar
      Lorenzo

      I think there are more choices than that. Comparing only a debased, former premium badge to a never-was-premium badge in the American market leaves out so many options.

      The biggest problem selling a phaeton in America at $70k is the “VW” on the grille. Nobody in America will pay for a “premium” Volkswagen as long as there are Bugs and Kombi’s on the street, to say nothing of the Golf, Jetta and Passat. Volkswagen would do better to steal a nameplate from the old Audi conglomerate, like DKW or NSU, and put it on the Phaeton, at least in America.

      • 0 avatar
        28-Cars-Later

        There certainly are, I was attempting to compare 70K boondoggles.

        “Volkswagen would do better to steal a nameplate from the old Audi conglomerate, like DKW or NSU, and put it on the Phaeton, at least in America.”

        Mercedes tried that with Maybach and failed.

        • 0 avatar
          psarhjinian

          VW has Audi. They don’t need to sell this car, at least not in North America. There is a reason why every other non-premium full-size car starts at a lot less than this, including the MkTaurus and XTS.

          But this is Piech, who is the kind of person no one ever says “No” to, and thusly assumes everything his company does is right. When this tanks in North America, we’ll hear all sorts of reasons as to why North America is wrong.** And perhaps they’ll double-down and we’ll get a third-gen Phaeton, and the beatings will continue until morale improves.

          (** for the record, VW isn’t the only company that does this; Honda is similarly arrogant; see the Insight and just about any Acura as an example)

          • 0 avatar
            28-Cars-Later

            I agree with you but XTS can get pretty expensive. XTS Platinum + AWD MSRP’s at 63K [!].

            http://www.leftlanenews.com/new-car-buying/cadillac/xts/prices/

          • 0 avatar
            psarhjinian

            Yeah, but who pays retail for a loaded XTS? For that matter, how many XTSs are actually sold?

            I have to give GM credit: they’re honest enough to admit that the XTS is a stop-gap; VW already has Audi for this kind of thing in North America and have no gap they need stopping.

            The Phaeton might make sense in Europe or China, but unless VW is shipping them here either to soak up units or as a kind of perverse mercy-f*ck, it’s kind of silly to sell them here.

            Side note: you also have to give Hyundai a break on the Genesis and Equus; Hyundai has no Audi-equivalent, so they can stretch without issue. This would be like Toyota selling the Avalon for 10% off the price of the Lexus LS.

        • 0 avatar
          Lorenzo

          “Mercedes tried that with Maybach and failed.”

          Mercedes didn’t sell the Maybach for $70,000. They were trying for the rarified air of Roll Royce with a gussied-up E-class. Volkswagen is trying to sell an E-class wannabe with Bentley underpinnings, and don’t realize the “VW” on the grille is the problem.

      • 0 avatar
        chuckrs

        Jack Baruth’s 1%, not the aspirational next 14%, is a possible market for the Phaeton. If the plutocrat wants a discrete luxury Q-ship, this might fit the bill. However, that is a 1% marketplace, so, yeah, bet on another sales flop. Where would you take it for service, VW or Bentley?

    • 0 avatar
      DeadWeight

      You mean if those were one’s only 2 choices?

      Drive the nail of masochism deeper & tell us that either came with a 3 year/36 month warranty, and that the car would have to be sold on the open market at prevailing prices whilst three years old, post warranty.

    • 0 avatar
      APaGttH

      ELR – only because it has a slightly better chance of being a collectible at some point, and the thought of a VW dealer working on my $70K car gives me the shivers.

      The Phateon is certainly more, errr, practical – but for that kind of money I’d go loaded to the max A6.

    • 0 avatar
      CoreyDL

      Not tough at all. I like real engines. Phaeton all day.

  • avatar
    matador

    So, the starting price is about $7000 lower than the cheapest Audi A8.

    I’d have the Audi.

    • 0 avatar
      sparc

      what they’re doing doesn’t make sense in the USA. If they sold it as a Chinese only Phaeton, I could understand.

      This has less a chance of succeeding than the original one.

  • avatar
    Davekaybsc

    Think about your average VW dealer. Now think about them working on your $70K+ car. The end.

    Hyundai is not too worried about this, I imagine.

    • 0 avatar
      segfault

      Yep. Mine banged the driver’s door against something metal and scratchy at the 10k service, then again while it was in for an unrelated body repair. They fixed it both times although the first time took some coaxing. Miraculously, they managed to avoid any damage at the 20k service.

  • avatar
    sirwired

    What dealer will agree to stock the things without MASSIVE floorplan assistance? This is going to be a slow-seller, guaranteed, but isn’t attention-getting enough to make for an attractive piece of showroom furniture.

  • avatar
    Landcrusher

    Headline says it all.

    Next!

  • avatar
    CJinSD

    The funny thing about Volkswagens is that the left lane bandits that buy them think they’re buying more image than they’d get from a Kia or Chevrolet. The Phaeton is proof that they’re wrong. Americans wouldn’t touch them at $60K, but they’d buy them for three times as much with a Bentley sticker on the grill. That’s the measure of VW’s brand image. Now where’d I park the Equus?

  • avatar
    dal20402

    There’s room for a few of these sorts of cars at $40-$50k. See the Genesis. At $70k this is a complete laugher. The $70k consumer will either go a bit smaller but just as comfortable inside with an A6, or spend the extra $15k for an A8, either way guaranteeing a sane dealer experience and no confusion about the car’s worth.

  • avatar

    This is ridiculous.

    I could think of one way that the Phaeton would work, and that’s if VW hit the full-sized “faux-flagship” market, which is almost $30,000 cheaper to start. Think about what you have in that market: the XTS, the MKS and the RLX—which heap lots of luxury onto plebeian FWD platforms but still don’t feel all that special…and there’s the horribly-dated and heavily-overpriced S80…and nicer versions of the 300. If VW had a luxury car there (even if it was closer to $48,000 or so), it could do very well. That’s what’s happening with the Hyundai Genesis, which offers a noticeable value over these other cars. But at $70K? Forget it.

    Of course, Volkswagen hasn’t been known to offer much concrete value versus other competitors on the market, and that’s true from the $15,000 Cheapskate Jetta Special to the $62,000 Touareg Hybrid…so this shouldn’t be a surprise.

    • 0 avatar
      S2k Chris

      “I could think of one way that the Phaeton would work, and that’s if VW hit the full-sized “faux-flagship” market, which is almost $30,000 cheaper to start. Think about what you have in that market: the XTS, the MKS and the RLX—which heap lots of luxury onto plebeian FWD platforms but still don’t feel all that special…and there’s the horribly-dated and heavily-overpriced S80…and nicer versions of the 300. If VW had a luxury car there (even if it was closer to $48,000 or so), it could do very well.”

      It would still compete against the bread and butter of the class, the E and the 5. Yeah, I know, those are “midsize” and the Failton is “large” but real people shop with bank accounts, not tape measures, and no way is anyone buying a VW over a nice E350 or 535i.

  • avatar
    tedward

    The part of me that just loves cars and driving salutes any new entry with the likely technical specs the Phaeton will bring to market. This part of me has no brand affinity or interest in the automotive industry.

    The rest of me shakes my head and wonders what the hell is going on. I could see a revived Phaeton losing money but being a worthwhile halo car if it had a truly stunning presentation that broke the corporate mold in the ways that Italian design houses do so well. If it doesn’t show up styled by the Italians I see it as a colossal waste of resources in a market where VW could probably put even the brochure budget to good use launching their actually desperately needed SUV/CUV lineup. At the very least I would hope that they would delay this until every possible other product need has been addressed, but I doubt it.

  • avatar

    This article really hits it on the head: VW has no worthwhile CUVs, which is a big problem in NA.

    Having driven the Tiguan, I can say that I quite liked it. It’s good looking, it’s sort of fun, it has plenty of power. But it is also outrageously overpriced, small inside, and gets pretty miserable fuel economy. Montreal buys them (as $42k R-Lines) for reasons I don’t understand, but no one else does and for good reason.

    A company that doesn’t seem to want to bother with understanding the market. Which I find vaguely insulting in a way, but in the end it’s their loss.

    • 0 avatar
      dal20402

      I can’t think of the Tiguan as a reasonable “CUV” when it’s actually smaller inside than the Golf it’s based on. VW needs a small crossover that’s class-competitive for interior space, as well as a bigger crossover to compete with Highlander/Pilot/Santa Fe.

  • avatar
    IHateCars

    I dunno…you can load up a TDi Touareg Executive for close to $70K, so maybe starting there for your flagship luxo-cruiser isn’t that far off after all.

    Whether they will sell any this time is another story…

  • avatar
    ajla

    Has Jack Baruth already put in his two pre-orders?

  • avatar
    bryanska

    This is a worse move than the ELR, which at least has limited competition.

  • avatar
    CoreyDL

    I’m sure they’ll make it look like a LWB Passat again, which goes to show you that you CAN get special styling in your $70k VW.

    Ugh.

  • avatar
    55_wrench

    Why bother?
    I just picked up a gently used, meticulously maintained LS430 and saved 55 large. Not that I can afford a Phaeton, but the LS ticks all the boxes and any Toyota Indy worth his salt can do the timing belt in another 5 years or so.

    And then there’s that badge thing..might be better for those who want to spring for a flagship to wait for the next Caddy, or Lincoln if they could wait that long.

    • 0 avatar
      Toad

      @55_wrench

      I’ve been sniffing around used LS430’s myself; if you don’t mind what year, mileage, and $ did you find that worked for you.

      LS430’s pricing is all over the map on the I-85 corridor.

  • avatar
    Lou_BC

    Is it just me but this car reminds me of the Crown Victoria. Is that VW’s strategy? piggyback upon Panther love?

  • avatar
    vtecJustKickedInYo

    Put a 1000 Horsepower Turbo VR6 in it and make it a 260 mph Super Salon #VDUB #STANCEWORKS #ROTIFORM #HASHTAG

  • avatar
    koshchei

    Hm. Volkswagen Caprice Classic? Volkswagen 98 Regency Brougham?

  • avatar
    Acd

    Since established luxury brands like Cadillac and Jaguar are having a rough go of the US luxury car market what makes VW think they can sell a $70K VW? It makes Cadillac’s current pricing strategy seem reasonable by comparison.

    My prediction is that is gets outsold every month by the more expensive Maserati Ghibli.

    • 0 avatar
      CoreyDL

      The Ghibli is really more than the Phaeton? There must be less space between those models than I thought.

      At a concours show I went to, they parked the Ghibli right next to the Quattroporte, and what a poor sight that was. Like the disappointing step-child that didn’t make the honor roll.

  • avatar
    55_wrench

    @ Toad,

    yeah, NP. Car was bought in the Bay Area, was a family’s Grandma’s car from new and she had to give up the keys.

    2003, <69K miles, base model, pearl white, timing belt service performed at 60K(due to years), fresh tires & front struts. 15.5K. Cheaper ones are out there, but the timing belt service and service history swung the deal.

    It drives like it was carved out of a block of steel, totally comfy ride. We shampooed the carpets & floor mats and it came out looking like as new car. Great build quality and material selection.

  • avatar
    STRATOS

    The Phaeton is the one of the biggest money looser in the auto industry ,second only to Bugatti.I believe its in the order of over $16 k per car.Not sure while they still build it.

  • avatar
    Sigivald

    “I want a giant Volkswagen prestige sedan/S-Class-Competitor but I’m just a little too stingy to get an A8L.”

    Said nobody in the entire history of the universe.

  • avatar
    wmba

    Ferdy Piech couldn’t care less what America thinks, whether the Phaeton loses money, or anyone’s opinion except his own.

    Of course that means marching across the world installing giganto-bizzaro machinery in his assembly plants to churn out MQB Golfs etc. And ruining VW’s ROI in the process.

    That’s why VW is now on a vast money-saving groupwise exercise (Phaeton excepted, natch), and is now locking horns with their union IG Metall about pay raises. There’s going to be a fight there, I think.

    But as his Supreme Majesty, Imperator Piech has decreed a new Phaeton, and since he dislikes America for not buying VWs like the rest of the world’s sutomotive lemmings, a Phaeton will once again be rammed down
    the throats of the not too wonderful US VW dealer body, whether they like it or not, in an attempt to wake them up. Won’t work, but Piech will enjoy sticking it to his somewhat scurrilous (in general) US dealers.

    This is a drawn out popcorn epic. Will be fun.

    • 0 avatar
      Lou_BC

      Maybe a version with a police prep package since cops aren’t too fond of the Taurus?

    • 0 avatar
      wmba

      Update Jan 28, 2015.

      The Europeans cannot figure out the Phaeton either. It’s just a Ferdy Piech vanity project when VW is reeling from attempting to pay for all that MQB machinery, trying to save $5 billion annually, and cheesing off IG Metall.

      http://mobile.reuters.com/article/idUSKBN0L11RH20150128?irpc=932

  • avatar
    Wodehouse

    Get an outsider, for heaven’s sake, to pen the outside of it. It then may have a chance of getting noticed. VW’s (Volkswagen Group as a whole, actually) current design language is mind numbingly dull.

  • avatar
    hgrunt

    Is there some kind of german tax loophole they’re taking advantage of by building the phaeton and losing money on it?

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