FRANKFURT -- Volkswagen boosted deliveries of its top-of-the-line Phaeton luxury saloon to customers in Europe by a fifth in the first five months of the year, Europe's largest carmaker said on Tuesday.
In a signal that its luxury strategy may finally be starting to pay off, a VW spokesman said the company couldn't keep up with demand for the Phaeton.
"Deliveries increased by 20 percent through the end of May Europe-wide," the company said in a statement.
VW raised the horsepower of its W12 Phaeton, the most powerful version, to 450 hp from 420 hp. VW also offers Phaetons equipped with V6 and V8 petrol motors as well as a V6 and V10 turbodiesel (TDI).
Earlier on Tuesday, German motor vehicles department KBA reported that first-half new Phaeton registrations rose by 31.1 percent to 1,648 cars, thanks to a 44.4 percent gain in June alone.
After previously disappointing sales of the Phaeton, a spokesman for the company said that capacity was fully utilized thanks to a surge in demand for its entry-level V6 TDI, which retails in Germany for 60,480 euros ($73,630) with tax, or nearly half that of the 106,000 euro W12 petrol version.
The V6 TDI Phaeton was launched in December last year.
"Customers ordering a Phaeton now won't receive it until 2006, and that's why we're looking into boosting capacity," he said.
In his first media interview since becoming VW brand chief, Wolfgang Bernhard told Germany's Der Spiegel that for now, he would continue with the brand's strategy of trying to position itself more upmarket with models like the Phaeton.
Chief Executive Bernd Pischetsrieder once criticised the car in an interview with CAR magazine, saying it "fails to sell because it is not distinctive enough".
He said at the time that the next generation would definitely not be a classic saloon.