VW launches its 'stealth-wealth' land yacht

Volkswagen may mean People’s Car in German, but the masses will not be driving the company’s new luxury model, Phaeton, which costs 98 000 euros ($96 000).

The Phaeton, a 5-metre land yacht bearing the same VW badge as the proletarian Beetle of the 1960s and ‘70s, is spearheading the company’s attempt to push its image upscale—and take a slice of the lucrative, recession-proof market for expensive cars from competitors such as BMW and Mercedes-Benz.

Many analysts are sceptical, citing VW’s established image as a mass-market automaker selling millions of compact cars, such as the tiny, 16 000-euro ($15 700) Lupo offered in Europe. They say the Phaeton may wow people with its monster engine and seats that massage the driver’s lower back, but it is too pricey for the company’s image and might drain business from VW’s existing luxury brand, Audi.

VW’s marketing chief, Robert Buechelhofer, says the car’s critics are living in the past. “They are assuming there won’t be any change in the world,” he said.

The Phaeton—and the Touareg, a sport-utility vehicle going on sale in Europe next month—will expand people’s minds about the company’s brand name, he said.

Phaeton “means an enhancement and a strengthening of the Volkswagen brand,” Buechelhofer said at the company’s Wolfsburg headquarters.
“It is now a symbol for a different type of car by comparison to traditional sheer mass market.”

One goal is to capture customers who owned VW’s 38 000-euro ($37 000) Passat but are being lost to competitors when they want to move up to a more expensive car. The first Phaetons are just showing up at dealerships in Europe, with models slated to appear in the United States next year. Chancellor Gerhard Schroeder, who used to sit on the VW board of directors when he was governor of Lower Saxony, already has sped through New York in one—previewing the Phaeton as his personal limousine during the World Economic Forum in February.

The car has all-wheel drive, a front seat that adjusts 18 ways, eight airbags, leather upholstery and five engine choices—including a six-cylinder model starting at 56 000 euros ($55 000) and a 10-cylinder diesel and a 12-cylinder gasoline model in more expensive versions.

The styling is sleek and massive—and a bit restrained. That is part of the idea, Buechelhofer said, to appeal to customers who do not want to flaunt their success.

“Stealth wealth,” he quipped.

That is why it will not steal customers from Audi, which is moving toward a sportier design, he said.

Greg Salchow, an auto analyst with Raymond James and Associates in Detroit, is among the skeptics, calling the Phaeton too different from VW’s other cars to lift their image. “It’s supposed to be an excellent car, but I don’t think it fits the VW brand,” he said. “There’s no similarity between the Golf and the Phaeton except that big badge stuck on the front and the back.” - Sapa-AP

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