Volkswagen to roll out the New Beetle

But it's a far cry from the 'Love Bug'

July 14, 1997
Web posted at: 8:39 p.m. EDT (0039 GMT)

(CNN) -- The bug is coming back, but you may have a hard time recognizing it.

During its second incarnation, Volkswagen's Beetle will have a decidedly different look, feel and price tag. It comes with air bags, a state-of-the art engine and even electric windows.

The New Beetle, an updated version of the bug-like air-cooled car that captured the nation's fancy during the 1960s, will become available to United States car buyers in spring 1998, Volkswagen has said. The German automaker stopped selling the original version of the Beetle in the U.S. during the 1970s, although the car has been available in Mexico since then.

Volkswagen plans initially to make fewer than 200,000 of the cars a year at its factory in Puebla, Mexico. The cars will be sold globally, but the company's primary target will be the U.S., where it hopes to carve a niche among mostly-single car buyers under 30 and Baby Boomers smitten by nostalgia.

Despite design similarities, the New Beetle will be a far cry from the old one. The old Beetle design of "Love Bug" fame, with its rear-mounted engine, cramped interior and thin doors, would never suffice in the safety-conscious 1990s.

So the new version will be bigger, meaning more headroom and legroom so that it can hold four adults. It will incorporate contemporary crash-protection and collision avoidance items such as air bags, side-crash protection beams and anti-lock braking systems.

And, unlike the old model, there will be a heater, fuel gauge and a radio -- even electric windows. It will be offered with a four-cylinder gasoline or turbocharged diesel engine capable of 50-mile-per-gallon fuel economy.

The New Beetle's price: about $15,000. That's more than 10 times the $1,480 price on the first U.S. Beetle in 1949 and more than twice the $6,170 price of the 1979 model, the last year the old Beetle sold in the U.S.

The company will first offer a two-door hardtop Beetle, and if that is successful, it will begin to offer a Beetle convertible version. Volkswagen is even said to be mulling a four-wheel drive version.

Volkswagen is probably lamenting the day it decided to can the old Beetle, a hugely-popular car that helped to define a generation. With its hip, anti-snob appeal, the Beetle was a powerful counterweight to the chrome-heavy models peddled by Detroit and helped to break open the huge market for compact cars.

At its peak in the late 1960s, Volkswagen sold some 500,000 Beetles per year in the U.S. By 1993, Volkswagen's sales in the vast American market had dwindled to less than 50,000.

The Beetle's replacement, the fuel-injected Rabbit, was plagued by reliability problems and continually escalating prices. The Golf and Jetta have also had their share of problems over the years, although the company's sales have improved to 134,000 in 1996.

That mini-comeback stems partly from a spirited advertising campaign and a novel marketing effort in which models are offered with mountain bikes, skis and snowboards as well as rooftop racks.

The New Beetle will augment Volkswagen's existing line of cars, and the company has high hopes the name will win over a new generation of Americans.

"Volkswagen is positioning itself to become the auto company of the Generation Xers," Christopher Cedergren, managing director of Nextrend, the automotive division of a research firm, told the Washington Post. "Those buyers want something...avant-garde, something that doesn't look like a Toyota Corolla."

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