VW has announced that it will halt production of the Volkswagen Phaeton -- the car everyone thought VW stopped making long ago -- at its state-of-the-art factory in Dresden next year, Reuters reports. The move comes amid a significant reassessment of the automaker's model strategy as well as an effort to cut costs in anticipation of expenditures related to the recall of diesel models in Europe and North America.

Production of the Phaeton, which has been on sale since 2002 and has received a number of updates since, will stop in March of next year. In recent months, production of the luxury sedan has fallen to just under 10 cars per day as demand has slowed, even though the model has achieved a limited but steady following in China. The Dresden factory will then spend approximately a year gearing up for production of the next-generation Phaeton, which is expected to debut in 2019.

The first-generation model was a pet project of former VW chairman Ferdinand Piech who championed the no-expense-spared flagship sedan for the brand, which required a $1.1 billion investment at the time -- a significant sum for what was viewed even then as a niche model. Even though Piech retired from the management board in 2002, the Phaeton stayed in production without major changes all the way into the present day, and VW still offers the sedan in a number of markets.

Demand for the Phaeton in Asia has kept the sales volume at an acceptable rate, by most accounts, though the luxury flagship was never seen as a money-making model in VW's lineup even at the peak of its sales, when it (predictably) competed with VW AG's own Audi A8 sedan.

A production halt for the first-generation model has been long-forecast, with the pressures of the diesel crisis injecting uncertainty into its successor, which VW has announced will be an electric car. The next-generation Phaeton was reportedly delayed due to the high projected costs of production, with VW pushing its debut back to figure out a cheaper way to produce it.

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