- The Washington Times - Thursday, May 5, 2005

Volkswagen isn’t the first auto manufacturer to eyeball its stable of midlevel products and decide it didn’t have the chops to retain the portion of its owner base looking to move into near-luxury and luxury automobiles. Lexus, Infiniti and Acura were all created to address the same dilemma at Toyota, Nissan and Honda.

Those marques, of course, chose to create separate, new upscale brands that have proven highly successful. When Volkswagen decided it needed to advance its arsenal, however, it engineered the near-luxury $40,000 VW Passat W-8. This was a major leap for a company best known for marketing $15,000-to-$25,000 compact cars.

Then before the market had time to take a breath and become adjusted to the W-8, the VW Phaeton was launched to campaign against the Mercedes-Benz S-Class and BMW’s 7-series in the high-end $70,000-to-$100,000 luxury segment. This strategy would be something akin to JC Penny adding Armani to its men’s clothing line, labeling it as JC Penny, but charging Armani prices. Although the quality would be there, it would still be a very tough sell.

Perception is everything. Because as with the JC Penny/Armani example, the Phaeton is Armani and can certainly go head to head with its German rivals. Volkswagen’s toughest job is to convince the public the VW badge can front a $70,000 plus sedan. For an intender to plunk down 70, 80, 90 or 100 large for the Phaeton, not only must he believe a VW can play on that field, he must be confident his neighbors, co-workers and golf buddies believe it as well. Prestige is a key motivator when spending those kinds of dollars for a sedan. The big question: Can Volkswagen paint itself as a prestigious brand?

Perceptions aside, the Phaeton is a handsomely styled, meticulously engineered sedan. Whether judged by its performance, standard content, comfort or looks, it concedes nothing to its more established competitors. Volkswagen pulled out all the stops in engineering the Phaeton. It remains to be seen if the gamble will pay off.

Basically there are two levels of Phaeton, determined by engine. The more affordable version comes with a 335-horsepower 4.2-liter V-8. The top-end Phaeton (provided for this evaluation) gets a 420-horsepower 6.0-liter W-12. A six-speed manumatic is bolted to the back of the V-8, while the W-12 has a five-speed manumatic distributing engine output to the wheels.

Both versions are all-wheel drive. You won’t find a mention about fuel economy in the Phaeton brochure. That’s probably because the W-12 has an Environmental Protection Agency rating of 12 miles per gallon in the city and 19 on the highway. The V-8 fares better at 16 mpg in town and 22 on the highway.

The four-wheel independent suspension architecture is enhanced with adjustable air suspension at each wheel, monitored by an electronic damping-control system. It constantly adjusts the damping rates based on the road surface and driving conditions. Four-wheel antilock disc brakes reel in Phaeton’s forward motion and feature tractio5n control, electronic stabilization, Electronic Braking Control and Electronic Brake-force Distribution. The V-8 comes with 17-inch alloy wheels, while the W-12 gets 18-inch ones.

With 118 inches between the center of the front and rear wheels, Phaeton’s wheelbase is a couple of inches shorter than that of the S-Class, but about the same as the BMW 745i. Its overall length is on par with the S-Class and 745Li. Width and height numbers are nearly equal as well.

In terms of comfort, luxury and technology, Phaeton’s cabin stacks up well against its homeland peers. High-quality materials, an abundance of leather and real wood and a complete battery of standard features are constant reminders this is a high-end luxury sedan. The 5-inch color display integrated into the instrument cluster shows the multifunction trip computer, while the 7-inch color display in the center of the dashboard shows the CD-based navigation system as well as adjustable settings for a variety of the car’s systems from audio to the air suspension and the four-zone automatic climate control to the tire-pressure monitoring system. The V-8 has a 10-speaker audio system with six-disc CD changer. The W-12 has an upgraded audio system with 12 speakers and a subwoofer.

When the Four Seater Package is included ($4,700), the middle rear seating position is replaced with a center console. The rear seats gain 10-way power adjustment, memory and massage feature, and power-adjustable lumbar support.

The Phaeton V-8 has a base price of $68,865, while the W-12 starts out at $99,715. Both prices include the destination charge and gas-guzzler tax.

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