Unsung heroes : Volkswagen Phaeton

Carole Nash Classic Insurance Specialists

Mike Humble ponders on the passing of a victim of its own pointlessness…

After 17 years Volkswagen are killing off the Phaeton. A point in case that image indeed... everything.
After 17 years Volkswagen is killing off the Phaeton. A point in case that image is
indeed… everything

After years of ruling the roost globally in so far as aspirational, mass-produced cars are concerned; the Germans are having a rough time of it. On one hand, we have ‘Emissiongate,’ where the quoted figures for exhaust outputs have seemingly lied like a cheap watch and, on the other, Volkswagen has finally admitted defeat and yanked the plug from the skirting board on one of the loveliest cars I’ve ever driven – and, dare I say it, the most spectacularly pointless – the Volkswagen Phaeton.

The current motor trade environment has never been more interesting and, in the hurly-burly world of High Street retail, the same cold, hard fact applies – budget is best. It’s not that long ago that cars such as Skodas were driven by the parents of kids who backed their books with woodchip rather than the centre-spread of Look-in. Once, not that long ago, if you shopped in Aldi or Lidl, you seriously ran the risk of becoming even more socially unacceptable than an Ian Huntley-themed children’s adventure park. Times have changed.

I call it poverty chic and the previous global recession has made people stop and think about what they spend their money on, and, indeed, where they spend it. Brands like Hyundai and Kia now rub shoulders with Ford and General Motors –  it’s taken them a few years, but their ‘slowly, slowly catchy monkey’ tactics have worked. It’s no longer necessary to drive a Kia Sedona wearing a full Burka or a cardboard box on your head, nor do they still supply a car with optional white wall tyres from new as they did with the Mazda 121-based Kia Shame… Oops, I meant Pride.

However, once you get to the upper classes of motoring, the old phrase of Image is everything still applies, and it’s here that a good few manufacturers have dropped a clanger. The Phaeton was designed to be the finest executive car in the world and, to a degree, Volkswagen probably pulled that off. One of my old Sales Directors had one on test for a few days and I had a drive up to London and back in a 5.0 V10 TDi – one of the few cars to make me gasp out loud at its amazing ability to isolate the outside world completely. Not only that, but the quality and craftsmanship was quite breathtaking, an incredible experience.

Would you just look at that? Take it from me its a car that leaves you speechless. Sadly that badge in the middle of the airbag just could couldn't carry the burden.
Would you just look at that? Take it from us; it’s a car that leaves you speechless. Sadly,
that badge in the middle of the airbag just couldn’t carry the burden

A friend of a friend bought one a few months ago and was stunned to find the salesman shovelling ten grand into his underpants before he had even committed to buying it. It’s been bought as a company asset so will be written off in the books. We thought he needed his bumps feeling but, as he said to me only a fortnight ago, ‘where else am I going to get this level of luxury for the money?’ The Phaeton is a wonderful machine on every level, but fatally flawed, and so, with production numbers slipping to under 3500 units annually, Volkswagen has called time.

The car cost a lot more than just money, too. The then top bod at Volkswagen, Ferdinand Piech, had the idea of developing a vehicle that would roundly trounce rival German makers – a bold plan when the car was first shown in 1999 but it pretty much bombed from day one. Volkswagen soon found themselves lost at sea with this one; while they were there someone conveniently found a long plank… and invited Herr Piech to take a meandering stroll along it. Built in a special factory in a forest with fairies and other mystical wonderments, it was soon so under productive that some sub-assembly of Bentley vehicles was shipped out to keep the crepe soled-shoed, snooker referee-gloved workers occupied.

The point is this: when you mix it with the true premium brands, the Volkswagen name loses its kudos. If you are a top CEO of the Dead Good Big Company Inc. you want to float around in a BMW 7 Series or a Mercedes S-Class. Why would you choose a car that looks like a big Passat from twenty paces regardless of its talent? What makes it even harder to fathom is why they even bothered when they had that exact kind of machine already sitting in their portfolio – the Audi A8. Volkswagen may cut the mustard in the yummy mummy school run or middle manager world but it’s diluted to just plain old H2O at board level.

With past exec masters such as the Senator and Omega, Vauxhall then gave us a oddly styled Vectra... FAIL!
With past Executive segment masters such as the Senator and Omega, Vauxhall then gave us
little more than an oddly-styled Vectra with only four seats… FAIL!

However, it wasn’t just Volkswagen who did this. We had the Vauxhall Signum – another WTF? kind of car. Take a Vectra estate, add some leather and unconvincing faux piano black and take away a fifth of the practicality by removing a rear seat. At the same time make the load bay all wonky-shaped and there you have it – Vauxhall’s executive carriage. You can pick them up now for pennies and some executive minicab owners love them to bits, but to others it made as much commercial sense as a triangular football. What a shame though… they drive really well but it was no Omega 3.0 – not by a long shot.

Oh, and of course we have good old Rover with its 800 Coupe – their take on the executive motoring. A car with to die forlooks and an interior which still looks mouthwatering to this day but which came with a price tag that could cause the hardest of men to tremble and weep. Craftsmen built 80 per cent of the 800 Coupe as the advert stated, but the car sold in penny numbers to the kind of customer that Rover didn’t want the coupe to go to – elderly, retired gentleman. Towards the end of the run they were throwing them out of the showroom for well under what it actually cost to make them.

Oh what a damn fine looking car - the 800 Coupe. Sleek on the outside svelte on the inside but the quality was pap and they couldn't even give them away in the end - shame!
Oh, what a damn fine looking car – the 800 Coupe. Sleek on the outside, svelte on the inside,
but the quality was pap and they couldn’t even give them away in the end – a shame!

So before we think too much about our own British cars that flopped more disastrously than a tired-out dog, remember… the Germans can make a world-class cock-up, too!

Mike Humble

Upon leaving school, Mike was destined to work on the Railway but cars were his first love. An apprenticeship in a large family Ford dealer was his first forray into the dark and seedy world of the motor trade.

Moving on to Rover and then PSV / HGV, he has circumnavigated most departments of dealerships including parts, service and latterly - the showroom. Mike has owned all sorts of rubbish from Lada to Leyland and also holds both Heavy Goods & Public Service Vehicle licences, he buys & sells buses and coaches during the week. Mike runs his own automotive web site and writes for a number of motoring or commercial vehicle themed publications

36 Comments

  1. I’d always understood the one reason for the Phaeton was to be a manufacturing practice run for the Bentley Continental. VW hadn’t intended to sell it in huge numbers but wanted to prove the components and production methods for a car that was aimed even further above their traditional customer base than the Phaeton was.

    Having the Pheaton in the portfolio would allow them to iron out any niggles with the W12 engine and drive-train before the Bentley was launched. This approach protected the Bentley brand from early quality issues and also limited the damage to VW if the Phaeton proved troublesome.

  2. A quality built car, but as Mike says, most customers in this market would opt for a BMW, Merc or a top end Audi? I have to say I like the interior trim colours and wood mix though. I wish more manufacturers would offer these 2 tone combos.

    I’ve never seen that many Phaeton’s about (perhaps I did but thought they were normal Passats). I would have thought the “CC” itself would have taken sales from the Phaeton as well. My brother has just bought a new XF which I have to say, in my eyes, is a better looker than the Phaeton.

  3. Part of the problem with the 800 Coupe was the poor torsional rigidity of the body – this was common to all 800s, but was made worse on the coupe by the sumptious leather which creaked and groaned as the various faces rubbed together as the body twisted. We had one on the fleet which must have had the interior stripped and rebuilt three times before we gave up trying.

    If I recall correctly, the list price was up near £30k which was totally ridiculous at that time, especially as the 800 was pretty long in the tooth by then.

  4. I though that the Pheaton production had stopped years and years ago. 3500 in 17 years, ups.
    Some years back I knew someone who bought one. He had a BMW 5xx before, and he was very impressed and happy with the Pheaton.

  5. Agree with Cliff at the top of the comments section. I don’t see the Phaeton as a failure. It was never about hitting sales numbers. It was a development mule for forthcoming Bentleys, and a statement of intent by VW Group. I think it’s great that “moonshot” cars like this got the green light and actually made it into production.

    No doubt the motor trade hated it. Took up valuable forecourt space which could have been given over to Golfs and Polos, horribly complicated to service (requiring too much investment in staff training), too many bespoke parts, too many warranty claims etc etc etc

  6. I actually thought the top photo was of a Passat, which perhaps summed up why it didn’t succeed in the marketplace.

  7. On the plus side.. nobody will hate you for driving a Phaeton.

    The depreciation on these things is very steep indeed, so if you bought one from new then you would lose a pretty penny when it came to selling it. However, as a second-hand buy it makes a lot more sense..

  8. I had the T16 turbo version of the 800 coupe on test for 24hrs when it was a current vehicle. I liked it. A poor man’s Bentley Continental R.

  9. I used to live (at the time of it’s launch) quite near the Phaeton ‘glassbox’ factory in Dresden. I remember what I assumed to be some kind of press launch activity which included a lengthy cavalcade of Phaetons crusing along the A13.

    Only problem was there were extensive roadworks at the time with width restrictions meaning they realistically couldn’t overtake anything due to their width so they all ended up behind a slow, fume belching Polish juggernaut, whilst my sweet and slender Rover Metro GTa 16v could happily whiz past.

    My Metro incidentally was the only one I saw in the 2 years that I lived in the former East Germany, attracting admiring glances wherever it went! Regrettably it didn’t make the journey home back to Blighty due to suspension that failed on the A13 Northbound one fateful evening…..

  10. I once had a ride in a Phaeton, from the airport to a hotel in Berlin. Can’t give driving impressions of course (was sat in the back) but was it much quieter & more comfortable than the Merc. E Class that took us back to the airport, but far from a “people’s car” (at least not people like me!).

  11. Cliff – agreed.
    Mike, Omegas were horribly overrated as driver’s cars, due to their having recirculating ball steering. I could set faster times point to point in an 88bhp R8 than in a 128bhp Omega. Even my 1970 Ventora could be set up for a corner or a roundabout better than the Omega – as an Irish lodger whom I terrorized many years ago could attest, if he wasn’t still hiding. He had a Moggy Mow estate, which had been shunted; so that in addition to the normal farts on changing gear, it also squeaked. Think about that – parp squeak, parp squeak – where have all the flatulent cars gone?

    -and a nitpick, it was Softly Softly catch ‘ee monkey, hence the name of the TV series.

    PS saw an interesting video about the Futon factory in Dresden once – components were delivered by specially constructed freight trams. Elsewhere, VW have driverless freight trains running between plants. Vorsprung durch Bahnfahrt, and all that.

  12. The Phaeton is in a similar situation to Austin’s great white elephant – the 3-litre. An aspirational top-of-the-range model for a non-premium brand (although we didn’t use these descriptions in those days) with styling that was far too similar to the popular mid-range model. Peugeot’s 605 and 405 were also in this situation. The Phaeton may have been well engineered but was forever held back by its Passat clone styling.

    By the way the cheap supermarket is Lidl not Liddle.

  13. The only other similar failure I can think of was – surprisingly – from Merc, reeling from the fact that their two main competitors – BMW and VW group/Audi, now owned uber luxury marques selling saloon cars to the type of customers that used to buy pullmans. So they dug out a marque from their books – Maybach.

    It was intended to go up against the Rolls Royce Phantom and Bentley Continental, but unfortunately it just looked like a big S class (which, for all intents and purposes, it was). While the S class is indeed a fine car, it is a bit too ‘executive airport transfer’ for the 1% who buy uber-luxury vehicles.

    Daimler (the German brand) quietly killed off the marque and faced the fact that it was S-class based, have now deemed it as a sub-brand of Mercedes to be applied to top of the range S class limosines as Mercedes-Maybach, alongside Mercedes-AMG as the performance division.

    The Phaeton is a great used buy however, where else for the money do you get Bentley comfort, equipment and engineering, all in a package that is so understated that it doesn’t look out of place with the neighbours Golfs and Passats, and doesn’t attract jealous vandals when parked at the car park.

    It was actually facelifted twice, in 2007 and 2011, to fit in with the VW corporate grilles.

  14. Reminiscent of Citroën’s wonderful and competent C6 which hardly sold at all because “only the Germans can build executive cars”… And like the Phaeton, they can be picked up for silly money.

  15. Always loved the Pheaton, will get one when prices drop. And yes my maths/history books had wallpaper on them lol xxxx

  16. I was also thinking of the Austin 3 Litre when I read this.

    VAG managed to do a similar thing in the 1980s with the Audi 200.

  17. I certainly wouldn’t call a 13-year production run a “world-class cock-up”. Far from it. In any case, a new version is coming out next year.

    The VW badge is not naturally a premium badge – neither was ARG/MGR in its last years. I suspect the UK market’s general rejection of 4-door saloons these days (35 Phaetons sold last year) has much to do with it.

    In contrast, such “sedans” go down a treat in the Middle and Far East – which is where the likes of VW will focus their sales efforts. Hence why the ugly Renault Talisman is not coming to the UK. I’m disappointed – and surprised – the new Espace is also not UK-bound, though.

    • I thought the Talisman is a gorgeous big car, and am genuinely sad that we aren’t getting it over here, instead we get some Jamjar SUV thing.

      (But then I am a fan of big French cars. While waiting on the wife’s SEAT getting serviced the salesman nearly had me buying a Laguna coupe MonteCarlo edition…)

  18. Yes, the Pheaton was built to enable VW how to build a decent Bentley. Much of the underpinnings and architecture is shared with Bentley but not that Bentley parts counters will ever admit that! The new Pheaton has been delayed until 2020 and will be an EV only, at least initially. A company near me was contracted to make the headlights for the new model and had a very lucrative contract cancelled a few weeks ago, that is how I know.

  19. Am I the only one who thinks the Volkswagen Phaeton looks better than the equivalent age Audi A8, even though it lacks the usual awful black, oppressive and technology exuding interior? If only it had actually worn the Audi badge!

    As for the Rover 800 Coupe, remember that back in October 1998 there was a major price re-alignment of all derivatives in the Rover 600 and 800 Series through the national dealer network – I have the adverts somewhere. For the 800 Vitesse Coupe and 825 Sterling Coupe, the showroom price was reduced to around £23,495 representing a near £4,000 saving over the old price. The final batch of unsold new stock of 800 Series which hung around until late Spring 2000 weren’t Coupes but regular trim levels in the 4-door saloon and Fastback. The Coupe was only ever built in low numbers anyway and represented just five percent of the second generation 800’s production.

  20. The Phaeton sold very poorly, I believe less than 600 units, in the USA/Canadian market. VW dealers didn’t want to sell them as too close to an Audi, they didn’t want to invest in special tools and parts for a limited market model, they were not really part of the demographics of other VW model shoppers. The VW name is for more basic transportation or budget performance, not luxury models. I bet most were sold off at huge losses to VW and their dealers. Not only did VW and Austin push luxury models of their basic brand models, but USA carmakers Ford, GM and Chrysler from the mid-1960’s made fancier versions of their cars that then creeped into the turf of other and slightly higher prices and equipped brands of their parent co’s.

  21. Volkswagen’s Vauxhall Ventora FE, a similar flop from the seventies that was just a Victor with a big engine and more trim that fooled no one and hardly anyone seemed to buy. Obviously the Phaeton is a bit more sophisticated than a car from 1973, but no one wants to spend really serious money on a big Volkswagen when they can probably buy a far more desirable big Merc or Jaguar.

    • Yes, it is the word ‘desirable’ that makes it all work. I will not forget the day of the Phaeton was shown in Frankfurt. While at the same time the Jaguar interiors were (sadly) full of wobbly plastic switches looking and feeling very much like the Ford equivalent, the Phaeton did show how a quality interior should look and feel. The difference to the S-class and 7 series – as well as the Bentley Mulsanne of the day was quite marked. It was the same commercial nonsense as the Austin 3 Litre was in the late 60s, but the ‘at all cost’-way the Phaeton was designed and built really mark this car out as special – and most likely another muster of times never to repeat.

  22. These cars were poor sellers , very unreliable and we never had the diesel Phaeton in the US, only the petrol W8 and W12. Bearing in mind the recent NOX testing fraud VAG is probably glad they didn’t bother importing the oil burner.

    The Maybach looked like a stretched Hyundai Sonata, not really competition for Rolls and Bentley.

  23. Fiat had a number of top of the range cars that never seemed to do very well, one of the last was the 130.

    At least they managed to make a decent coupe out of it.

    • The last Fiat Croma was another example. A big hatchback / estate / MPV – admittedly not a million miles away from how a Citroen DS5 might be described, but, surprisingly for the Italian marque, it just looked bulbous and slab sided.

    • Anon, in this neck of the woods at least, the Superb has always been a strong seller – fleets like them, Taxi drivers appreciate the size, space, shape and VW diesel engines, even the Stormont chauffeurs for the politicians use them, albeit armoured top spec post-facelift mk1s.

      In some ways they remind me of the Granada….

  24. I’m not sure but that the Phaeton wasn’t a victim of VW’s own lack of confidence about its place. Nobody doubted that VW could produce an excellent luxury car. Here in the US, VW had been sort of a “luxury lite” kind of brand. The buyers enjoyed the cars’ taut bodies and quirky problems, and the dealers enjoyed transaction prices well above mainstream competition. VW didn’t worry about competing with Toyota or Chevy. The A8 had been proving for years already that VW could build a big, nice car. Hyundai wasn’t timid or apologetic about the Equus (soon to be Genesis G90), they just brought them over and attempted to sell them. It gets much of the same skepticism from the market that’s suggested about the Phaeton. It is, like the Phaeton, a very nice car. Just like when the Lexus LS400 came out, Hyundai is letting the car speak for itself. When VW is the puppeteer behind Bentley and Bugatti, why would there ever be a doubt about the Phaeton unless VW’s own worries from the car’s debut bred the sales trouble? VW should have just put forward the Phaeton with the confidence that it was a compelling vehicle for the market, and followed with two more generations before giving up. Pulling from the market after one protracted generation sure doesn’t look as serious as the Phaeton. That’s why the G90 will survive after the Phaeton is gone.

  25. While not a direct comparison, the Japanese tried to muscle in on the executive car market in the late seventies and early eighties with cars like the Datsun 280 C. These would come fitted with every luxury available, often being as well equipped as a Jaguar for a lot less money, have typical Japanese reliability and tended to be smooth to drive. However, they often imitated American designs, executive car buyers stayed away in droves, and they mostly sold to taxi drivers and people who wanted a cheap big car. The Phaeton is a victim of badge snobbery in the same way.

  26. Well, I think you flatter the Datsun 280C . No one would ever have thought of it as a competitor for an XJ6 , nor even for a Rover SD1 . It was its lack of capability which killed it , with dismal performance, bad packaging , truly appalling handling and roadholding and looks that even its mother couldn’t love . There was a similar Toyota the name of which I think was the Crown and that bombed in an even bigger way . But you are right about badge snobbery, because in contrast the Lexus LS WAS a capable car, even if not very exciting , but after an initial burst of enthusiasm it quickly died the death , and of course the market for this type of car is now very limited indeed

  27. Bit unfair to suggest that the Lexus LS “quickly died the death after an initial burst of enthusiasm”. It has been in continuous production for over 27 years now, and has roughly kept pace with the BMW 7-series in terms of sales.

    https://en.wikipedia.org/wiki/Lexus_LS#Sales_and_production

    Like the Phaeton, the LS is about more than just sales. It is there to build a brand image. The existence of the LS means Lexus can sell many thousands of tarted-up Camrys and Landcruisers in the USA at a healthy markup.

  28. I’ve heard the Camry (certainly the 1990s models) were a real sleeper for owners, being a fair bit cheaper than a Lexus with almost the same level of comfort & reliability.

  29. Andy W : the LS nosedived everywhere except the USA ( not surprising because that was what it really was, an American style car which was rather better made than the domestic product) . I don’t regard parity with the latter day 7 series BMW as much of a recommendation ! ( When did you last see a new one in the UK ?? ) But of course, as I stated, the market for the S class Benz , 7 series , Jaguar XJ has virtually disappeared and they sell in handfuls compared with the E class, XF or 5 series . What is perhaps more surprising about Lexus is that the GS also has all but disappeared – indeed the brand as a whole appears in the UK to be withering away

  30. @ chrisopher storey, I can’t remember the last time I saw a new BMW 7 series or a Mercedes S class, although I’ve seen a few Jaguar XJs. Possibly the recession and sky high fuel prices in the early part of this decade has almost killed these cars off, and cars like the Jaguar XF can do almost the same thing as an XJ for less money. Also big SUVs have made an impact on this market.

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