UPDATE: Some encouraging details from reader Kevin B.:

The 2.5L inline-5 cylinder is the base engine. It replaces the old 2.0L 4 cylinder, the 115hp "2.slow," as it was called. It's not a replacement for the VR6 (though, VW has actually stopped making the VR6 and as of 2004 hasn't been putting it in the Mark IV Jetta, either). The initial batch of Jetta Mark Vs are simplified in terms of options packages and engines and such. Here's what the full engine lineup will be within a few months:

2.5l I-5 - 150hp, 170 lbs./ft. torque.
1.9l I-4 TDI diesel - 100hp, 177 lbs./ft. torque.
2.0l I-4 turbocharged - 200hp, 207 lbs./ft. torque.

That 2.0T is a replacement both for the old 1.8T and the previous VR6. It's getting rave reviews in Germany in the new GTI. It'll be avaiable by June or July in the new GLI, which looks like this.

It'll also have the sportier interior, better steering, and better suspension that'll be on the new GTI already in Europe and in America next year. You'll be able to have it with either the 6-speed stick, or the 6-speed DSG dual-clutch sequential manumatic (my New Beetle has this, it's pretty wild).

Eventually, the Jetta V *may* get a VR6, of either 240hp or 280hp variety.

Nice; I hope so. I did kinda suspect that we'd be seeing better engines trailing the debut car with its base-only engine; you gotta have something to upsell the sophomore car with other than just 1.0 bug fixes, right?

It makes Euro-centric sense for VW to be edging toward the turbo engines rather than the higher-displacement sixes, but I still want that VR6 back. Especially if we're talking numbers in the high 200s. That'd be a nice consolation for this Jetta's being so much bigger than the one that 174 hp moves so well out from under me...

As for it encroaching into Passat sales, I agree - but there's a new Passat that will be in the US in the fall that's larger than the current one:

Oh my! Now that looks sharp...

Also, on the price of the Jetta V - the Jetta V starts at around $18,500, in the form of a Value Edition that'll be on sale shortly after the launch. It lacks the leatherette interior of the base "normal" Jetta in favor of some pretty nice cloth, lacks the multifunction display in the gauge cluster, and has a slightly different sound system.

Which means, the Jetta V starts at about the same price as the Jetta IV, with much more equipment, and goes up to the $26,000 level for the Package 2 car with leather and everything. So, with the Value Edition, it really doesn't start any higher than the old car. Just ends up higher. :)

Well, that's good news—I just hope the undeniably larger size and the "It's all grown up—sort of" marketing don't undercut the benefit of these figures.

It's an uphill trudge they've set themselves for. It's naturally easier to take a product upmarket than it is to defeature it, which is what VW going "back to its roots" would entail. To succeed, they'd need a marketing campaign as expertly engineered as the one for the iPod shuffle, which faced exactly the same difficulty—and seems to have succeeded quite lavishly.