Volkswagen considers closing the Phaeton plant image

In the recently announced cutting plans, Volkswagen takes into consideration the possibility to close down the Phaeton plant, sources say.

Budget cuts have to be made by Volkswagen in order to cope with the emission scandal financial repercussions and the company has been clear about its adjustment budget plans. According to the financial weekly WirtschaftsWoche, quoted by Automotive News Europe, the automaker is considering closing its Germany plant where the Phaeton model is built. Only eight Phaetons a week are being produced at the facility and the new VW Group CEO Matthias Mueller wants to close the factory next year and move Phaeton output to a plant that builds similar Audi and Porsche models, WirtschaftsWoche said.

The Dresden factory was opened in 2002 and it was at that time an architectural statement, and still is, with glass walls so customers can admire how their cars are being put together. The Phaeton project has not been a success story, as the model sales were low on. Consequently, the production in Dresden fell 30 percent in 2014 to just over 4,000 cars, according to VW’s annual report. On top of that, the development of the Phaeton cost more than 1 billion euros.

The plant’s closure would definitely not be well received by the workers union. “Dresden is and remains a firm part of the VW family. Even if the new Phaeton concept comes later, that does not mean that we have cause to question Dresden,” VW’s labor chief and supervisory board member, Bernd Osterloh, said in a statement.

Via Automotive News Europe