The VW Phaeton was a failure. The idea was to bring the Volkswagen brand upmarket but that created sibling rivalry with Audi and as it turns out people would rather have an Audi than a premium Volkswagen. Sales fell well short of expectations which when a VW is priced like an Audi A8 and sharing the same drivetrain it should be obvious to everyone involved that people would rather go for the brand that is already positioned as offering premium models and not the one trying to make inroads into the segment.

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Volkswagen and Audi have a clear distinction and this experiment already failed once so why is Volkswagen doing it again? Volkswagen makes a ton of money everywhere except the United States. Sure, VW's sell here, just not like they do in Germany, Europe, or the rest of the world. This is going to be VW's halo car in the United States.

CEO Martin Winterkorn stated the following, "A brand as large as Volkswagen needs a halo project in the upscale segment. We've seen what happens to brands that don't have that kind of project."

Volkswagen sales are down in the United States and shrinking. Will another Phaeton change this? Don't small, fun, affordable cars like the Volkswagen Up Buggy make more sense for increasing sales volume and perception? It certainly is more logical than cannibalizing Audi A8 sales.

Expect to see the new Phaeton on display at the Detroit Auto Show. VW is going to do what it is going to do and they have money to burn so let's watch them burn it. Again.

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