VW CONSIDERS A NEW BUG-INNING IN U.S. CAR MARKET

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Volkswagen's future looks a lot like .|.|. the venerable Beetle.

The troubled German automaker will test consumer reaction to a concept car that carries the Beetle's distinctive profile, but with softer lines and designed to accommodate modern technology and safety fea-tures such as dual air bags.

Dubbed Concept 1, the car was unveiled last week at the North American International Auto Show in Detroit. Ulrich Seiffert, a Volks-wagen AG board member in charge of research & development, said the company is studying whether to produce a model based on the concept car. It would take about three years to bring the four-seater to market.

"We would never bring the Beetle back," Mr. Seiffert said. "But we would like to go back to our roots as an honest, affordable, reliable car that made us successful in the U.S."

The back-to-the-future Beetle is a potential marketing coup but one born of desperation to a company unable to capture the emotions of U.S. buyers since the last "Bugs" were sold in 1981.

First developed in 1935 as a "people's car," the Beetle is still being marketed in Latin America. Despite its nostalgic appeal, the original Beetle likely wouldn't meet U.S. consumers' expectations of a modern car and it wouldn't pass safety standards.

Backed by classic ads created by Doyle Dane Bernbach, New York, the "Bug" became a huge sales success and a cultural icon of the late 1960s and early 1970s.

In the Beetle's heyday, VW sold more than 500,000 cars a year in the U.S. In contrast, the importer fell short of the 50,000-unit sales mark in 1993.

Reports have surfaced that some VW board mem bers wanted to pull out of the U.S. Insid ers said Chairman Ferdinand Piech approved the high-pizazz U.S. unveiling as a way to signal the commitment to staying.

"Volkswagen is powerfully committed to the United States," said Thomas Shaver, VP in charge of Volkswagen U.S. He predicted VW will begin a substantial rebound this year, based on wider availability of the Golf III and Jetta III models, plus the addition of new and redesigned models.

Mr. Shaver also acknowledged a big ad spending boost. The increase is said to involve doubling 1993's ad budget, to $100 million in 1994. VW will stick with its umbrella theme line, "The most loved cars in the world," developed by Berlin, Wright & Cameron, New York.M

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The old and the new: Volkswagen's classic Beetle (l.) and the new Concept 1 car.

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