Flagship Down? Volkswagen Suspends Phaeton Production To Cut Costs

VW said in October it would discontinue production of the Phaeton sedan, which is built at the glass-walled plant in the eastern state of Saxony. The model -- a pet project of former Chairman Ferdinand Piech which cost more than 1 billion euros ($1.1 billion) to develop -- has never met sales targets since coming to market in 2002.

Production of the Phaeton, assembled by 300 of the Dresden plant's 500 workers, will end in late March. The site, the smallest of VW's 10 German factories, will then be reconfigured for about a year to prepare for producing an all-electric Phaeton by about 2019.

"Production in Dresden will be suspended during the restructuring phase," Jens Rothe, head of the works council of VW's operations in Saxony, said on Wednesday, adding that the plant would be awarded a new product for when it reopens, ensuring "employment will in future be secured on today's level".

W208 - 12/17/2015 2:24:13 PM

+4 Boost

oH noes!

carsnyc - 12/17/2015 3:50:25 PM

+2 Boost

LOL!

PUGPROUD - 12/17/2015 4:33:58 PM

+2 Boost

The hits just keep on coming! There will be more spending cutbacks, model delays, R&D cutbacks, employment reductions outside Germany and dealer closings. You know it will be really bad if they start selling a major division (Bently, Scania, etc) and even worse if there are labor cuts in Germany. VW has twice as many employees as Toyota but lower annual sales. A very big problem now that diesalgate scandal has emerged.

MDarringer - 12/17/2015 8:49:48 PM

+1 Boost

Lamborghini is the easiest to sell by itself. Hyundai/Kia could fund its future.

Bentley will be a tough sell. Their products are on aged platforms (Conti, Flying Spur), pointless (Mulsanne), and or based on proprietary VW parts (Bentiguan). If someone buys Bentley, all they get is the name. The rest is pretty worthless.

Bundling the above two with Porsche and making them a stand alone company and then making Skoda/VW/Audi/Scania another stand alone company would make obvious sense. All of the synergies could still exist, but dividing the mega-corporation into two scaled down, and more efficient companies with specific product foci, is the intelligent move.

GermanNut - 12/17/2015 5:49:47 PM

+3 Boost

Someone on here had mentioned that the Phaeton would likely be suspended right after the emissions scandal broke. You hate to see something like diesel gate be the wake up call but I'm all for Volkswagen senior management realizing that the company needs a overhaul across the entire company. From R&D to Production to Sales and Marketing, Volkswagen needs to rid itself of its toxic culture that was allowed to flourish under the previous leadership.

If a brand was to be sold it won't be Audi or Porsche - they make far too much money for the Volkswagen Auto Group.

MDarringer - 12/17/2015 8:40:44 PM

+3 Boost

The Phaeton has been an arrogant dismal failure built in an arrogant glass assembly plant. I say implode the plant too.

W208 - 12/18/2015 8:44:14 PM

+1 Boost

I won't lie, I considered a Phaeton W12 after watching Transporter 2.

As an enthusiast, you know when it's not like the rest of the lineup. I personally don't mind the Phaeton look, but it's no doubt a stuffy, over-priced piece of kit that will likely ruin your budget, and require you explain the 5W's to inquisitive locals who are better suited for buy-here/pay-here or crappy old American marques.