Volkswagen Phaeton: The (rich) people’s car

Volkswagen makes another bid for the luxury market

Michele Tantussi / Bloomberg / Getty Images; AMC

At the risk of repeating past mistakes, Volkswagen is planning to reintroduce its Phaeton luxury sedan to North America.

The car, built in a futuristic glass plant in Dresden, Germany, made its debut 10 years ago and was supposed to redefine the luxury segment. But U.S. buyers balked at paying more than $70,000 for a Volkswagen, regardless of how refined the ride. (One reviewer called it a “fat Passat.”)

The Phaeton was pulled from the U.S. market in 2006, but continued to be sold in Europe. Now, as then, VW is hoping a new version will help it better compete with rivals Mercedes and BMW, despite already going toe-to-toe in the luxury segment with its Audi brand.

More important, a well-received Phaeton could boost sales of cheaper, high-volume models such as the Jetta and Golf by making the brand more desirable. The trick is convincing consumers that the “people’s car” is meant for rich people, too.

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