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An executive says the next Phaeton wasn't "enough of a leap forward" to effectively compete with the Model S.

Volkswagen has admitted that it killed plans to build a Phaeton EV were killed due to competitive pressure from the Tesla Model S.

Confirming prior speculation, VW brand head Herbert Diess suggests the company was far along in the development process of a next-generation Phaeton -- intended to be offered exclusively as an all-electric sedan -- when the project was dropped and designers were sent back to the drawing board.

"We were quite far advanced with the next Phaeton but it became clear it wasn't enough of a leap forwards," Diess told Autocar. "A modern large saloon has to be competitive and have an advantage over the Tesla, which is the benchmark and in many regions dominates the segment."

Rather than adapting the Phaeton to run on batteries, the company decided to double down on EVs and create an all-electric MEB platform architecture that will eventually be used for several different models. In theory, an MEB-based sedan could keep the Phaeton name, though such a move is appearing less likely.

The proposed MEB concepts so far include a Bus-inspired ID Buzz van, along with the basic ID compact hatchback. The company has promised to show two or three more ID concepts this year.