The W12 Coupe supercar at the Tokyo auto show is the latest part of Volkswagen group's DM6.5 billion (E3.3 billion) investment in luxury vehicles.
Executives say VW hasn't yet decided whether to build the supercar. But it almost certainly will be produced.
The rear-drive, two-seat 600hp styling concept was a more mature and aerodynamic design than the first coupe study by Giugiaro shown at Tokyo in 1997. But VW's Tokyo display also included a second, running supercar that only days earlier had set a 24-hour world speed record, averaging 297kph at the Nardo test track in Italy.
The supercar will enhance VW's image, said Martin Winterkorn, board member for research and development.
'We must emphasize the emotional values of VW,' he said. 'And with this speed record, we have also proven the W12 engine's potential and qualities.'
VW critics are doubtful about the feasibility of a supercar with a VW badge. They see it as overlapping VW's portfolio of exotic cars, including the all-new Lamborghini Murcielago.
'I don't see that,' Winterkorn said. 'It fits under our umbrella of exotic cars headed by Bugatti.'
Winterkorn hinted that the decision on whether to build the W12 Coupe would be made soon.
'We will monitor reactions and make a decision to produce this car at an annual volume of 50 to 100 after the Tokyo show,' he said. 'But recent events have taught us that such cars may have difficult times.'
The most likely production location would be VW's designated luxury plant in Dresden, Germany. The plant will be dedicated on December 11.
VW did not say how much a W12 Coupe might cost.
'But it will be more expensive than the Lamborghini Murcielago,' said Robert Buchelhofer, VW board member for sales and marketing.
Other new models planned by VW include a replacement for the Audi A8 and Volkswagen's first pure luxury car, codenamed D1, due early next year.
VW's DM6.5 billion luxury-vehicle investment program 'was initiated four years ago and runs until 2003,' Winterkorn said. The investment includes model development and also the Dresden plant.
'We had to increase the investment a little, covering extra development costs on the D1 to comply with developments by the competition,' Winterkorn said. 'For example, we decided on air suspension for D1 instead of the conventional springs originally planned.'
The D1 eventually will offer V-6 gasoline and diesel, W-8 and W-12 gasoline and V-10 diesel engines. Winterkorn said the V-6s would not cheapen the image of the D1 compared with more established brands.
'Just look at Mercedes-Benz, where most of the S-class models have V-6s,' Winterkorn said. 'These cars are often company cars, so there is a high demand for V-6s.'
Volkswagen plans to sell 20,000 D1 cars a year.