VW Phaeton to Top Out at $85,390

Volkswagen Has Scaled Back Phaeton Sales Projections

Its going to cost Americans $85,390 for the best version of a VW model that is already a sales disappointment for the German firm in Europe.

If luxury car buyers arent interested in a Premier Edition of the Phaeton with the W12 engine and a special equipment package, then they can get the entry-level model with a V8 for $64,600.

According to John White of Detroit-based Volkswagen America, these prices "deliver the best qualities of German engineered performance and luxury at superior value."

VW likes to think that Phaeton is in the same general luxury category as the Jaguar XJ, the Mercedes-Benz S-Class and even its own Audi A8, but buyers in Europe dont seem to share the firms enthusiasm.

VW had planned to sell some 10,000 Phaetons in 2003, but recently scaled that projection back to about half of that in the face of sales significantly below its expectations. The car will be arriving in dealerships this December.

To propel the 5,194 pound sedan, the 4.2-liter V8 delivers 335 hp at 6,500 rpm and only 317 lb-ft of torque at 3,500 rpm, which accounts for its leisurely 0 to 60 mph time of 6.8 seconds.

With the 6-litre W12 engine delivering 420 hp at 6,000 rpm and 406 lb-ft of torque from 3,250 to 4,250 rpm, the 0-60 mph time drops to a slightly more respectable 6.0 seconds.

There are only 330 units of the Premier Edition Phaeton W12 available around the world, and each of them has identical equipment levels, including a Piano Black paint scheme.

Its not performance or equipment or style thats stopping Phaeton sales, analysts say, so much as suitability. Volkswagen famously means "peoples car" in German and that definition doesnt seem to include a car this expensive, especially since there are a bunch of other models with more appeal to the self-indulgent consumers who shop in this category.

Even VWs current chairman, Bernd Pischetsrieder, admits this is a problem, but he inherited this car from his predecessor and probably cant kill the Phaeton for at least a year.

The Phaeton disappointment comes at a bad time for the Wolfsburg-based firm, since sales of other models arent going well, the recent euro-dollar exchange rate is eating badly into its profits, and the cost of retrofitting its Brazil operation has been great. As a result, the company said at the end of October that its profits were likely to drop by about 50 percent this year.

Early sales of Phaeton in the US have been very slow, even though VW has been forced to sticker the car for about $23,000 less than it costs in Europe.

Whatever it costs, the Phaeton is certainly well equipped, coming as it does with all-wheel drive, an air suspension system with Electronic Damping Control, an upscale climate control system, Xenon high-intensity discharge headlamps, heated washer nozzles for the front windshield, courtesy entry-exit lights at all doors, an oversized sunroof, a premium AM/FM sound system, a glovebox-mounted six-disc CD changer, a power trunk lid, a HomeLink universal transmitter, an anti-theft keyfob, GMs OnStar telematics system, an anti-theft alarm system, and an integrated infotainment system.