New U.S. VW Chief Wants To Bring Back The Phaeton

Posted by: David Kiley on September 7, 2007

Perhaps no Volkswagen model more embodies the company’s odd product strategy over the last decade more than the $75,000-$90,000 Phaeton sedan. The car, which VW chairman Ferdinand Piech developed to go up against the Mercedes S Class and BMW 7 Series, has been a flop in Europe and was discontinued in the U.S.

But Stefan Jacoby, the new CEO of Volkswagen of America, says he would like to see a second generation of Phaeton developed and for it to come back to the U.S. “It was a big mistake to drop the Phaeton,” he said.

“I’d like to see the Phaeton be the hero of the VW lineup when it comes to technology, especially fuel economy,” says Jacoby. Perhaps that’s an indication that it will happen, and not just a wish. Jacoby reports directy to current VW chairman Martin Winterkorn and is known to have the ear of Piech who is now supervisory board chairman and thought to be setting VW’s long term strategic agenda. Piech was known to be extremely irritated when former VW chairman Bernd Pischetsrieder dropped the Phaeton from the U.S.

Jacoby says that VW needs to get “funkier” in the U.S. with product and marketing than it has been. And he considers the expensive sedan part of that strategy. “A world class luxury sedan that doesn’t show the luxury all over the place and that could have the only fuel efficient 12 cylinder diesel engine…that’s funky,” he said.

Jacoby certainly isn’t afraid to look to VW’s past. At a ceremony Thursday in Virginia to announce next year’s move, Jacoby gave Virginia’s Governor a scale model of a Volkswagen (original) Beetle instead of one of the company’s new cars. German executives have lonig been conflicted about the Beetle, and consider it to be a museum piece. Many had no interest in the company’s development of the New Beetle. Jacoby said he chose the Type 1 Beetle rather than have to choose between a current Volkswagen or Audi scale model, and risk dissing either side of his company. “The Beetle is our heritage and was the safer choice,” Jacoby winked.