Volkswagen Temporarily Shutters Showcase Phaeton Plant To Save Money
Volkswagen will suspend production at its small, flagship facility in Dresden that produces the Phaeton for at least a year, Reuters reported ( via Automotive News).
The small, boutique plant will be shuttered to help cut costs for the automaker, which announced it would scale back some projects to help it pay for its massive diesel scandal. According to the report, development of the Phaeton cost roughly $1.1 billion and the sedan hasn’t met sales targets since it was introduced 2002.
Reuters reported that the plant would be shuttered for about a year, beginning in March, and would be retooled to build an all-electric Phaeton by about 2019.
The Phaeton slowdown is one of the few instances Volkswagen has publicly admitted that its costly diesel recall has taken a toll on finances.
Since the automaker revealed in September that 11 million of its cars worldwide cheated emissions tests, Volkswagen has maintained that it would scale back its once-massive research budget, and find other ways to trim costs, but very little has been made public. In November, the automaker said it would save about $2 billion by eliminating some trims and special editions of its cars.
However, in his first public speech since the scandal, new CEO Matthias Müller said the company was working to protect jobs and made clear that it would spend more on electric vehicles in the future.
The Dresden plant employs 500 workers, according to the report. Roughly 300 workers help build the Phaeton and may be reassigned to Volkswagen plants.
More by Aaron Cole
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This is why VW does not do well in certain markets, most notably North America. The Phaeton has always been a complete and utter flop. They are (will be) having dire financial issues because of the diesel scandal, yet they still INSIST on wasting money on another VW luxury sedan that no one will buy. It's maddening!
The Phaeton is a wonderful car, but it isn't a wise business decision for VW. I don't like that they have to cut it, but it is something that must be done.
Talk about a waste of resources. You already make the Bentleys and the A8s somewhere else. Just bother with those two.
Can someone explain to me the Phaeton hate? I know it never sold well (too much $$$ for a VW) but by all accounts it's a magnificent car, if you want that type of car, of course.