diff --git a/bin/vagrant-package b/bin/vagrant-package
index e83f69873..b55781d6c 100755
--- a/bin/vagrant-package
+++ b/bin/vagrant-package
@@ -21,10 +21,7 @@ Usage: #{command.full_name} #{all_options_string}
 Package the current vagrant environment
 
 EOS
-
-  opt :file, "the name of the resulting packaged file"
-
   run do |command|
-    Vagrant::VM.package((command.argv[0] || 'vagrant.box'))
+    Vagrant::Commands.package(command.argv[0])
   end
 end
diff --git a/config/default.rb b/config/default.rb
index ed3e6d887..80a95bf57 100644
--- a/config/default.rb
+++ b/config/default.rb
@@ -14,6 +14,9 @@ Vagrant::Config.run do |config|
   config.vm.base_mac = "0800279C2E41"
   config.vm.project_directory = "/vagrant"
   config.vm.forward_port("ssh", 22, 2222)
+  config.vm.disk_image_format = 'VMDK'
+
+  config.package.name = 'vagrant'
 
   config.chef.cookbooks_path = "cookbooks"
   config.chef.provisioning_path = "/tmp/vagrant-chef"
@@ -21,4 +24,4 @@ Vagrant::Config.run do |config|
     :instance_role => "vagrant",
     :recipes => ["vagrant_main"]
   }
-end
\ No newline at end of file
+end
diff --git a/lib/vagrant/commands.rb b/lib/vagrant/commands.rb
index 7c529ce0a..c89a0c851 100644
--- a/lib/vagrant/commands.rb
+++ b/lib/vagrant/commands.rb
@@ -6,7 +6,6 @@ module Vagrant
   class Commands
     extend Vagrant::Util
 
-
     class << self
       # Initializes a directory for use with vagrant. This command copies an
       # initial `Vagrantfile` into the current working directory so you can
@@ -98,6 +97,18 @@ suspended state.
 error
         Env.persisted_vm.start
       end
+
+      # Export and package the current vm
+      # 
+      # This command requires that an instance be powered off
+      def package(name=nil)
+        Env.load!
+        Env.require_persisted_vm
+        error_and_exit(<<-error) unless Env.persisted_vm.powered_off?
+The vagrant virtual environment you are trying to package must be powered off
+error
+        Env.persisted_vm.package(name || Vagrant.config[:package][:name], FileUtils.pwd)
+      end
     end
   end
 end
diff --git a/lib/vagrant/config.rb b/lib/vagrant/config.rb
index a86427890..7993b207e 100644
--- a/lib/vagrant/config.rb
+++ b/lib/vagrant/config.rb
@@ -51,6 +51,8 @@ module Vagrant
       attr_accessor :project_directory
       attr_reader :forwarded_ports
       attr_accessor :hd_location
+      attr_accessor :disk_image_format
+
 
       def initialize
         @forwarded_ports = {}
@@ -70,6 +72,10 @@ module Vagrant
       end
     end
 
+    class PackageConfig < Base
+      attr_accessor :name
+    end
+
     class ChefConfig < Base
       attr_accessor :cookbooks_path
       attr_accessor :provisioning_path
@@ -82,6 +88,7 @@ module Vagrant
 
     class Top < Base
       attr_accessor :dotfile_name
+      attr_reader :package
       attr_reader :ssh
       attr_reader :vm
       attr_reader :chef
@@ -92,6 +99,7 @@ module Vagrant
         @vm = VMConfig.new
         @chef = ChefConfig.new
         @vagrant = VagrantConfig.new
+        @package = PackageConfig.new
 
         @loaded = false
       end
diff --git a/lib/vagrant/packaged.rb b/lib/vagrant/packaged.rb
deleted file mode 100644
index e16450a0c..000000000
--- a/lib/vagrant/packaged.rb
+++ /dev/null
@@ -1,51 +0,0 @@
-module Vagrant
-  class Packaged
-    attr_reader :vm, :file, :name
-
-    def initialize(name, params)
-      @vm = params[:vm]
-      @file = params[:file]
-      @name = name
-    end
-
-    def compressed?
-      @file
-    end
-    
-    def decompress(to)
-      # move folder unless compressed?
-      # decompress
-      # return File object of ovf for import
-    end
-    
-    def compress(to)
-      folder = FileUtils.mkpath(File.join(to, @name))
-      
-      return @file if compressed?
-
-      ovf_path = File.join(folder, "#{@name}.ovf")
-      tar_path = "#{folder}.tar"
-      
-      @vm.export(ovf_path)
-      
-      # TODO use zlib ...
-      Tar.open(tar_path, File::CREAT | File::WRONLY, 0644, Tar::GNU) do |tar|
-        begin
-          working_dir = FileUtils.pwd
-          FileUtils.cd(to)
-          tar.append_tree(@name)
-        ensure
-          FileUtils.cd(working_dir)
-
-        end
-      end
-
-      # TODO remove directory
-      
-
-      tar_path
-    end
-    
-    def ovf; "#{@name}.ovf" end
-  end
-end
diff --git a/lib/vagrant/util.rb b/lib/vagrant/util.rb
index 334b44914..c34f0203b 100644
--- a/lib/vagrant/util.rb
+++ b/lib/vagrant/util.rb
@@ -1,5 +1,9 @@
 module Vagrant
   module Util
+    def self.included?(base)
+      base.extend Vagrant::Util
+    end
+    
     def error_and_exit(error)
       puts <<-error
 =====================================================================
diff --git a/lib/vagrant/vm.rb b/lib/vagrant/vm.rb
index ec6338eb2..d8ab2f383 100644
--- a/lib/vagrant/vm.rb
+++ b/lib/vagrant/vm.rb
@@ -1,10 +1,7 @@
 module Vagrant
   class VM
-    HD_EXT_DEFAULT = 'VMDK'
-    attr_reader :vm
-
-    extend Vagrant::Util
     include Vagrant::Util
+    attr_reader :vm
 
     class << self
       # Bring up the virtual machine. Imports the base image and
@@ -20,15 +17,6 @@ module Vagrant
         return nil if vm.nil?
         new(vm)
       end
-
-      def package(name, to=FileUtils.pwd)
-        Env.require_persisted_vm
-        error_and_exit(<<-error) unless Env.persisted_vm.powered_off?
-The vagrant virtual environment you are trying to package must be powered off
-error
-
-        Packaged.new(name, :vm => Env.persisted_vm).compress(to)
-      end
     end
 
     def initialize(vm=nil)
@@ -76,7 +64,7 @@ error
 
       logger.info "Cloning current VM Disk to new location (#{ new_image_file })..."
       # TODO image extension default?
-      new_image = hd.image.clone(new_image_file , HD_EXT_DEFAULT, true)
+      new_image = hd.image.clone(new_image_file , Vagrant.config[:vm][:disk_image_format], true)
       hd.image = new_image
 
       logger.info "Attaching new disk to VM ..."
@@ -183,6 +171,37 @@ error
       @vm.save_state(true)
     end
 
+    # TODO the longest method, needs to be split up
+    def package(name, to)
+      folder = FileUtils.mkpath(File.join(to, name))
+      logger.info "Creating working directory: #{folder} ..."
+
+      ovf_path = File.join(folder, "#{name}.ovf")
+      tar_path = "#{folder}.box"
+      
+      logger.info "Exporting required VM files to working directory ..."
+      @vm.export(ovf_path)
+      
+      # TODO use zlib ...
+      logger.info "Packaging VM into #{name}.box ..."
+      Tar.open(tar_path, File::CREAT | File::WRONLY, 0644, Tar::GNU) do |tar|
+        begin
+          # appending the expanded file path adds the whole folder tree 
+          # to the tar archive there must be a better way
+          working_dir = FileUtils.pwd
+          FileUtils.cd(to)
+          tar.append_tree(name)
+        ensure
+          FileUtils.cd(working_dir)
+        end
+      end
+
+      logger.info "Removiding working directory ..."
+      FileUtils.rm_r(folder)
+
+      tar_path
+    end
+
     # TODO need a better way to which controller is the hd
     def hd
       @vm.storage_controllers.first.devices.first
diff --git a/test/vagrant/commands_test.rb b/test/vagrant/commands_test.rb
index ecfc0b1b5..e99cc516e 100644
--- a/test/vagrant/commands_test.rb
+++ b/test/vagrant/commands_test.rb
@@ -131,4 +131,33 @@ class CommandsTest < Test::Unit::TestCase
       Vagrant::Commands.resume
     end
   end
+
+  context "package" do
+    setup do
+      @persisted_vm.stubs(:package)
+      @persisted_vm.stubs(:powered_off?).returns(true)
+    end
+
+    should "require a persisted vm" do
+      Vagrant::Env.expects(:require_persisted_vm).once
+      Vagrant::Commands.package
+    end
+
+    should "error and exit if the VM is not powered off" do
+      @persisted_vm.stubs(:powered_off?).returns(false)
+      Vagrant::Commands.expects(:error_and_exit).once
+      @persisted_vm.expects(:package).never
+      Vagrant::Commands.package
+    end
+    
+    should "package the vm with the default name and the current directory" do
+      @persisted_vm.expects(:package).with(Vagrant.config[:package][:name], FileUtils.pwd).once
+      Vagrant::Commands.package
+    end
+
+    should "package the vm with the specified name" do      
+      @persisted_vm.expects(:package).with('foo', FileUtils.pwd).once
+      Vagrant::Commands.package('foo')
+    end
+  end
 end
diff --git a/test/vagrant/packaged_test.rb b/test/vagrant/packaged_test.rb
deleted file mode 100644
index 6f6019eb7..000000000
--- a/test/vagrant/packaged_test.rb
+++ /dev/null
@@ -1,18 +0,0 @@
-require File.join(File.dirname(__FILE__), '..', 'test_helper')
-
-class BoxedTest< Test::Unit::TestCase
-  context "exporting a vm" do
-    should "create a tar in the specified directory" do
-      vm = mock('vm')
-      location = '/Users/johnbender/Desktop'
-      name = 'my_box'
-      new_dir = File.join(location, name)
-      vm.expects(:export).with(File.join(new_dir, "#{name}.ovf"))
-      FileUtils.expects(:mkpath).with(new_dir).returns(new_dir)
-      Tar.expects(:open)
-
-      # TODO test whats passed to the open tar.append_tree
-      assert_equal Vagrant::Packaged.new(name, :vm => vm).compress(location), "#{new_dir}.tar"
-    end
-  end
-end
diff --git a/test/vagrant/vm_test.rb b/test/vagrant/vm_test.rb
index 66aa3b1f8..12c7bb27d 100644
--- a/test/vagrant/vm_test.rb
+++ b/test/vagrant/vm_test.rb
@@ -226,7 +226,7 @@ class VMTest < Test::Unit::TestCase
         image, hd = mock('image'), mock('hd')
 
         Vagrant.config[:vm].expects(:hd_location).at_least_once.returns('/locations/')
-        image.expects(:clone).with(Vagrant.config[:vm][:hd_location] + 'foo', Vagrant::VM::HD_EXT_DEFAULT, true).returns(image)
+        image.expects(:clone).with(Vagrant.config[:vm][:hd_location] + 'foo', Vagrant.config[:vm][:disk_image_format], true).returns(image)
         image.expects(:filename).twice.returns('foo')
         image.expects(:destroy)
 
@@ -241,4 +241,19 @@ class VMTest < Test::Unit::TestCase
       end
     end
   end
+
+  context "packaging a vm" do
+    should "dump the three necessary files to a tar in the current working dir" do
+      location = FileUtils.pwd
+      name = 'vagrant'
+      new_dir = File.join(location, name)
+      @mock_vm.expects(:export).with(File.join(new_dir, "#{name}.ovf"))
+      FileUtils.expects(:mkpath).with(new_dir).returns(new_dir)
+      FileUtils.expects(:rm_r).with(new_dir)
+      Tar.expects(:open)
+
+      # TODO test whats passed to the open tar.append_tree
+      assert_equal Vagrant::VM.new(@mock_vm).package(name, location), "#{new_dir}.box"
+    end
+  end
 end