2006 will be the last year for NAR Phaeton sales. - Page 3

Alx · **Re: 2006 will be the last year for NAR Phaeton sales. -** 11-14-2005, 06:57 PM

Quote:

Originally Posted by Carbon

The day I see an A8 chromed out in a rap video I'll have to kill someone.

Get your guns out...

http://www.germancarzone.com/showthread.php?t=24&page=2&pp=10

Carbon · **Re: 2006 will be the last year for NAR Phaeton sales. -** 11-14-2005, 07:08 PM

Quote:

Originally Posted by AlxAmg

Get your guns out...

http://www.germancarzone.com/showthread.php?t=24&page=2&pp=10

I don't have much of a problem with that one because it's inspired by an earlier A8 show car that Audi themselves made. It also doesn't have big ugly wheels and still isn't in a rap video.

Alx · **Re: 2006 will be the last year for NAR Phaeton sales. -** 11-14-2005, 07:31 PM

i forgot Carbon, the rap video was a pre-requisite.

Merc1 · 01:22 AM

There have been some valid points made about why the Phaeton failed in the U.S. market - status, image, brand name etc. are all valid. However VW of America did little or nothing to promote the car. Most people didn't even know the Phaeton existed, combined with VW's lousy U.S. dealer setup and poof-->failure. VW's U.S. dealer operation can't get service right on Jettas and Passats so there was no way in hell they were going to be able to sell and service the Phaeton. Mercedes, BMW, Jaguar, and Lexus are all luxury car dealerships and they treat their customer as such.

Nobody in the U.S. media has said that big veedub was a bad car, only that it didn't fit the VW image and that it didn't have a proper dealer setup to support it.

As much as I liked the car, we all know it didn't make sense when VW already has a luxury arm - Audi. VW was trying to have their cake and eat it too, doesn't work that way. Especially in the U.S. market.

M

Mr. M · **Re: 2006 will be the last year for NAR Phaeton sales. -** 11-16-2005, 06:14 AM

Well for all you know, the Phaeton could one day in the future be a vintage automobile - for the most luxurious VW ever built that nobody wanted. Till then, the Phaeton faces a dark, danky future. Maybe once they introduce the 4-door coupe that's situated between the Passat's and the Phaeton's price, it would iron out some issues of brand recognition.

It would take time and effort on VW's part, without doubt.

SDNR · 08:41 PM

Quote:

Originally Posted by Merc1

ThereNobody in the U.S. medial has said that big veedub was a bad car, only that it didn't fit the VW image and that it didn't have a proper dealer setup to support it.

As much as I liked the car, we all know it didn't make sense when VW already has a luxury arm - Audi. VW was trying to have their cake and eat it too, doesn't work that way. Especially in the U.S. market. M

You are 100% correct there Merc1 - I have always felt the Phaeton was, in essence, a stupid idea - it is a great car though, but you're right, it was a completely unnecessary model given VAG already offer the A8.

Although the Phaeton will sell better in Europe and perhaps parts of Asia relatively better than in the US, this is no reflection of any kind of "lack of sophistication" of the American market. Quite the contrary actually, it really shows the strong brand awareness in the American market - VW is not known to be a luxury car maker - there really is no shame in making excellent small and relatively affordable cars - even their small cars generally aren't all that cheap though.

Osnabrueck · **VW Pulls Phaeton from US Market -** 11-16-2005, 10:38 AM

Add insult to injury - The upcoming Lexus LS has a mug that's a wholesale rip-off of the Phaeton. American buyers will be none the wiser.

Quote:

By JOHN D. STOLL in Detroit and CHRISTOPH RAUWALD and STEPHEN POWER in Frankfurt
?Staff Reporters of THE WALL STREET JOURNAL November 15, 2005;*Page*A8
Volkswagen AG said Monday it will pull its pricey Phaeton sedan from the U.S. market in February, delivering a new blow to the chairman of its supervisory board, Ferdinand Piech.

Mr. Piech championed the development of the Phaeton while he was chief executive, from 1993 to 2002, and he envisioned the car as the centerpiece of an ambitious strategy to turn VW into more of a luxury-car maker.

Mr. Piech's "strategy of moving the brand more upmarket was flawed," said Stephen Cheetham, an analyst with Sanford C. Bernstein Ltd. in London. The withdrawal of the Phaeton from the U.S. less than three years after its launch "is a tacit admission that that strategy is in disarray."

The decision to pull the Phaeton out of the U.S., the world's largest auto market, is the latest sign of trouble for Volkswagen's North American business, which racked up €818 million ($960 million) in losses during the first nine months of the year.

Volkswagen of America Inc. spokesman Tony Fouladpour said the Phaeton, which sells for $68,000 to $104,000 and was launched in the U.S. in 2003, "fell a little bit short of our expectations."

The Phaeton's demise in the U.S. comes as Mr. Piech confronts criticism for apparent conflicts of interest. He recently backed a purchase of a 20% stake in Volkswagen by Porsche AG, a company controlled by Mr. Piech's family. He is the grandson of Ferdinand Porsche, founder of the sports-car maker.

Through his family, he also owns part of Porsche Holding Salzburg, an Austrian company that distributes vehicles made by Volkswagen's VW, Audi, Skoda and Seat brands in Eastern Europe and elsewhere. Mr. Piech couldn't be reached for comment.

Last month, after the release of a VW-commissioned report by J.P. Morgan Chase & Co. on the conflict-of-interest question regarding the Porsche stake, other members of the supervisory board -- the German equivalent of a U.S. board of directors -- pressured Mr. Piech to resign. But labor representatives on the board backed Mr. Piech, and he kept his seat.

Although VW officials have said Volkswagen plans to continue working on a new version of the Phaeton, Mr. Cheetham said the economics of building the Phaeton "look more dubious" if Volkswagen takes the car out of the U.S. market.

The company spent almost €1 billion to build the factory where the car is made in Dresden, Germany, a glass-and-steel edifice so impressive that the town's opera company once used it when the local opera house was flooded. The "glass factory," as it is known, was another pet project of Mr. Piech's, but today it operates at a fraction of its potential capacity.

Last year, Volkswagen sold about 7,000 Phaetons world-wide. Originally, VW had expected to sell approximately 20,000 a year and to compete with the world's most established luxury sedans, such as DaimlerChrysler AG's Mercedes S-Class, BMW AG's 7-Series and the Audi A8 of Volkswagen's own luxury unit, Audi AG.

With its sales down sharply in the U.S. and China, Volkswagen is under pressure to reduce costs in Germany, where some of its plants are operating at capacity levels of about 70%, well below the 90% threshold many analysts consider necessary for profitability.

VW's focus on luxury models like the Phaeton has left it with a product line lacking the kind of minivans, compact sport-utility vehicles and convertibles that have become hot sellers in the U.S.

Snake Vargas · **Re: VW Pulls Phaeton from US Market -** 11-16-2005, 11:00 AM

Similar topic here:

http://www.germancarzone.com/showthread.php?t=1053 (2006 will be the last year for NAR Phaeton sales.)

But it could somehow become a collector's item in America.. though unlikely.

Osnabrueck · **Re: VW Pulls Phaeton from US Market -** 11-16-2005, 11:11 AM

Whoops! I shouldn't post this early in the morning.

Mr. M · **Re: VW Pulls Phaeton from US Market -** 11-17-2005, 04:35 AM

But in perspective, 7000 Phaetons sold for a new and unknown luxury model from VW isn't half as bad.

They need time, good dealerships and marketing. To change people's perspectives.

Without a doubt the car, based on its merits, can and will do well like how Audi is slowly being accepted today in the modern world as a competitor to MB and BMW.