The Volkswagen Phaeton. Ralf Hirschberger/picture-alliance/dpa/AP
When you pay $70,000 for a car, you expect certain things. Leather. Fancy technology. A smooth and quiet ride. The Volkswagen Phaeton had it all. Running a W12 engine—essentially two V6 engines meshed together—it was the first VW to feature radar adaptive cruise control and adaptive air suspension. It was a technological marvel. And when it was introduced to US consumers, it bombed.
Why? Because it was missing the most important thing that comes with a luxury price: A luxury nameplate.
Conceived by then-chairman of Volkswagen Ferdinand Piëch, the Phaeton was meant to compete against full-sized luxury cars like the Mercedes S-Class, the BMW 7-series and, weirdly, Volkswagen Group’s own Audi A8. Built on the same platform as the Bentley Continental GT, the Phaeton was launched in 2002. In the US, it started for around $70,000 but could quickly top $85,000 fully loaded.
Piëch insisted the car meet 10 key parameters. Most were kept secret, but one of them was this: The Phaeton should be able to drive all day at 86 mph, with an outside temperature of 122 degrees, and the air conditioning should be able to maintain an interior temperature of 71.6 degrees throughout. And it did it! It also had a dehumidifier and a door that popped down over the climate vents, acting as a sort of radiator. The result was a car that was as warm or cool as the passenger wanted, without having to suffer something as dreadful as air blowing on their face. Nice. It was also, as a result of its price, about as far from a People’s Car as you can get.
“People who don’t know that the car is related to the Audi A8 see that it’s really expensive with a VW badge,” says Karl Brauer, an auto analyst with Kelly Blue Book. “People who are in the know, they know what you’re really getting is a budget priced Audi A8. One group was just much smaller than the other group.”
In America, buyers are very brand conscious. Most car shoppers looking to spend $70,000 are going to want it to come with some cachet, regardless of how wonderful the car itself is. That’s why Kia and Hyundai have had trouble moving their upmarket K900 and Equus sedans. “That’s a market that’s hard to make any ground on because it’s not that large,” says Brauer. “To come in there with a Volkswagen and expect any volume is not really very smart planning.”
The Phaeton sold only a few thousand units in the United States and was removed from the market in 2006. However, it is still available around the world and has seen success in China and especially in Volkswagen’s home of Germany. When it comes to cars, Europeans, don’t seem to be as brand conscious as Americans are. Mercedes is actually a huge company that makes things like tractor trailers and box trucks, as well as inexpensive family cars—all of which aren’t available in America, helping the company to keep its “premium” status stateside. That’s likely why on the continent, Volkswagen can sell a $70,000 luxury sedan without anyone getting too worked up over the fact that it has a VW logo on it instead of Audi’s four rings. It’s also why the newly introduced Ford GT supercar, which will cost well into six-figures, looks a little odd with the blue oval on the front.
Some automakers, especially Honda and Toyota, tend to be very conservative. Others, like Ford and Chrysler, are willing to “roll the dice a little bit”, says Brauer. Volkswagen is in the latter camp, it’s always been one of the more eclectic car companies in the US, from its products to its advertising. Some 25 percent of Volkswagens sold in the US are diesel powered, something generally not seen outside of big pickups, at least in large volumes. It also sells hugely popular cars like the Golf and Beetle, which frees them up to take chances, like with the Phaeton.
Volkswagen may be looking to take a risk again. A number of reports have suggested a new Phaeton could be coming back to the US for 2018, perhaps in a plug-in hybrid variant. Would it be more successful the second time around? We’ll see, but the current Phaeton starts at more than $80,000 in Germany so it remains a long way from the People’s Car.
Have a crazy invention or whopping failure you want us to cover? Email alex_davies@wired.com and jlgolson@gmail.com and we’ll check it out.
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