Volkswagen Phaeton:Phenom Or Folly?

Geneva-You don't expect to see sweat-beaded brows in Switzerland early in March, but inside a tent specially erected for the launch of Volkswagen's Phaeton, the perspiration was flowing freely. To be fair, it was an unseasonably warm afternoon, but the moisture that glistened on the forehead of Bernd Pieschesrieder had as much to do, I think, with the nature of the event-the first public unveiling of VW's new luxury sedan-as the temperature.

The Phaeton signifies a bold, upmarket move for "The People's" car company, and one day this strategy will be looked back upon as a brilliant product offensive-or as a blunder of overweening hubris. The Phaeton will come to represent either the best of Ferdinand Piech's legacy, or will it become a symbol of a monomaniacal drive toward an unreachable realm of the market.

Piech has moved on to a more rarefied position within the VAG empire, leaving new chairman Piechesrieder to present the argument for VW entering such a difficult segment. And a compelling argument it is, centered around a three-tiered strategic plan involving "Product, Production and Sales & Service."

The product, as it appeared in static display on the floor of the Geneva auto show, definitely has presence. The Phaeton is, at a glance and after close study, nothing else but a Volkswagen, the family resemblance a key factor, said Piechesrieder, in identifying the the big luxury sedan with the entire VW line. Observed Jens Neumann, the board member responsible for just about everything that happens with VW in North America, from the beginning the Phaeton design brief called for it to visually underscore the "specific DNA" that makes it, and its brethren, different and distinct from mainstream automobiles. VWs may be mass produced, allowed Neumann, but its cars boast quality and refinement that set them apart from other large carmakers. Indeed, Volkswagens are found in almost every competitor's design studios as benchmarks in such areas as interior styling and build quality.

The engineering of the Phaeton looks to be sound (we won't drive it until late June), and the level of technology and amenities is certainly competitive for the $60,000+ arena. The Phaeton, in short, represents nothing less than everything VW's engineers have learned.

Production, second leg of the triangle, involves both the build process and the Phaeton customer's "personal experience" of buying and owning the car. VW invested almost 190 million Euros in the Glserne Manufaktur Dresden (Trans-parent Factory), integrating the latest strategies in on-time delivery of supplier parts and a unique opportunity for Phaeton buyers to follow along in the manufacture of their cars and even contribute by working on the production line. I'll have more on VW's singular approach after a visit to Dresden in June, but there's one design feature which may best represent the effort that went into the plant: The sodium streetlights around the plant's grounds were designed with a special yellow spectral range that won't disturb the insects in a nearby botanical garden.

The third element of the launch strategy will be the most difficult for VW to implement: Sales and Service-at least on a level with such standard-bearers as Lexus. Phaeton Service, as it is called, features a new system of technical support and manufacturer-aided repairs that will enable local service technicians unprecedented access to in-factory experts in service and repair. Other aspects of Phaeton Service (which, if all warrantied services are conducted, lasts the lifetime of the car) include replacement Phaetons when the car is in for service or repair, and reimbursements for expenses incurred because of a breakdown or other service-related incident. It's all very comforting on paper, but the VW franchise, at least in America, has a history of poor customer relations and needs to improve dramatically to make this leg of the triangle equally effective as Product and Production.

Should Piechesrieder and Co. be sweating with nerves over the Phaeton? Stay tuned and we'll let you know.