Fleet News

Volkswagen Phaeton



THE new Volkswagen Phaeton reveals the scale of the German manufacturer's ambition in the elite luxury car market.

Volkswagen expects fleets to account for about 30% of sales for its forthcoming luxury car, called the Phaeton.

Adding that it anticipates a proportion of sales will be through personal contract purchase schemes, the manufacturer claims it will introduce programmes that protect the car's residual value and ensure the Phaeton is a desirable used vehicle.

The vehicle, which made its debut at this year's Geneva Motor Show, goes on sale in the UK next spring. VW's UK sales target for next year is 255 units. It expects sales to increase to 454 units in 2004 and 550 units in 2005.

The Phaeton will compete against the Mercedes-Benz S-class, BMW 7-Series and Lexus LS430.

Only 20 VW retailers will sell the Phaeton for between £42,000 and a wallet-thumping £70,000.

The luxury VW will come with a choice of five engines comprising three petrol: a 3.2-litre V6, which is expected to account for 50% of total sales, a 4.2-litre V8 and 6.0-litre W12, and two diesels: a 2.5-litre V6 TDI and 5.0-litre V10 TDI. The W12 and V10 are likely to be available at launch in the UK with the V6 petrol following a month later.

VW's head of luxury cars Rod McLeod said: 'The actual sales figure of the Phaeton is not that important – it is more about building up the Volkswagen brand.'

A car costing £70,000 new will obviously still command a high price as a used vehicle, although impressive residual values can still mean savage depreciation in terms of percentage lost. For example, were the £70,000 Phaeton to retain a sector average 40% of its new price at three years/60,000 miles, the depreciation would amount to a colossal £42,000. But McLeod believes the Phaeton will be a popular secondhand choice.

'I think the car will be quite hard to find as a used vehicle,' he said during an international press event to launch the car in Dresden and Berlin.

McLeod said Volkswagen will lease demonstrator vehicles to retailers for between six and nine months in a move that gives the manufacturer 'some control' over when the demo cars become available for sale as a used vehicle.

'It is supply and demand. Although our sales targets are conservative, there definitely won't be an influx of used Phaetons for sale. If we had planned to sell 1,000 units then maybe that would be an issue,' said McLeod.

Martin Ward, national research manager for CAP, said the company would work closely with Volkswagen to predict a residual value for the Phaeton nearer to its launch date. Of the car, he said: 'It is an outstanding vehicle of great quality and looks and does everything right. Mercedes has done a lot of hard work in educating people to buy its used products and this is what VW must do with the Phaeton. 'It will be an expensive used car. New sales won't be a problem for VW but the company must create demand for it as a used vehicle.'

Volkswagen claims 'discerning buyers who desire a discreet luxury product that sets the automotive benchmarks in technology, quality and design' will buy the Phaeton. It adds that the car 'redefines the Volkswagen brand and will have a halo effect on other products in the range'.

Behind the wheel

THE Phaeton is a great looking car and the ride quality is superb, although that is nothing less than you would expect from a vehicle costing upwards of £42,000.

I drove the top-of-the-range model that boasts a big 6.0-litre W12 engine and offers a whopping 420 bhp – just right for those German autobahns. It is smooth and quiet and effortless to drive.

Mind you, should you find yourself stressed out on a long journey, simply activate the back massage system to ease those aching muscles. Wonderful.

And the stereo system is simply one of the best money can buy. It picks out sounds from a CD you'll never have heard before regardless of the number of times you may have played it.

Volkswagen claims the car's air conditioning system is one of the best in the world. Its 4-Zone Climatronic offers driver and passengers, including those sitting in the rear, controls to individually adjust the temperature for the left and right seat. It also has a feature that prevents the windscreen from ever steaming up.

A large centre console containing the infotainment centre dominates the cockpit. It is packed with gadgets and buttons which you can soon learn to negotiate your way around.

While I admire its look, the Phaeton is fairly sober in appearance (it basically looks like a bigger but slightly flatter Passat) but Volkswagen hopes that will be part of its appeal.

The manufacturer claims the Phaeton offers above average interior space and even describes the knee space in the rear as 'best in class'. But I am of average height and while I wasn't cramped during a spell as rear passenger, it didn't feel that spacious.

In terms of safety, the Phaeton offers two two-stage front airbags, sidebags for front and outer-rear passengers and also full-length window bags. It also has a cruise control function that the driver can programme to slow the car if it comes up behind a slower vehicle.

Driving verdict

The Phaeton is a brilliantly built but fairly unexciting car and only time will tell whether it becomes a serious contender for its German rivals. Of course, there will be those who won't entertain the idea of swapping a Mercedes for a VW, but for those who like the idea of discretion, it is a perfect choice.

CO2 emissions and fuel consumption data correct at time of writing. The latest figures are available in the Fleet News fuel cost calculator and the company car tax calculator.

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