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VW Announces Plan To Buy Karmann's Assets, Build New Car - MotorAuthority
1933 - 39
Adolf Hitler approves Ferdinand Porsche's design for the "people's car," or volkswagen. A town called Stadt des KdF-Wagens, now Wolfsburg, is established for factory workers in 1938. Full-scale production is planned for September 1939, but war intervenes.
1939 - 45
During World War II, the Volkswagen plant is primarily used to produce military vehicles, including the SUV-like Kübelwagen and the amphibious Schwimmwagen. By 1943, more than 12,000 prisoners of war are working at the factory, most of them repairing aircraft and building V1 rockets to bomb Britain.
1945 - 47
Stadt des KdF-Wagens is bombed, captured by U.S. forces in 1945, and then handed over to the British. Major Ivan Hirst paints a Volkswagen green and shows it to British officials. They order 20,000. American, British, and French motor companies decline to take over the plant.
Volkswagen, reorganized as a trust under West German control, introduces the Volkswagen Type 2 van, pickup, and camper, and the Karmann Ghia sports car.
The Volkswagen Type 1 Beetle is exhibited and sold in the United States for the first time. Only two units sell that year, but sales soon pick up.
Volkswagen Group of America is formed to standardize service and sales in the United States. Production of the Type 1 Beetle increases drastically, reaching 1 million units.
Sales soar as the witty "Think Small" ad campaign by Doyle Dane Bernbach lures sophisticated (and younger) consumers.
Disney releases the first Love Bug film about Herbie, a VW Beetle with a mind of its own.
Volkswagen merges two previous purchases -- Auto Union, owner of the discontinued Audi brand, and NSU Motorenwerke -- to create the modern-day Audi, the company's luxury brand.
On February 17, the 15,007,034th Type 1 Beetle is made, surpassing the Ford Model T as the most produced single model in history.
Volkswagen opens its first U.S. factory in New Stanton, Pennsylvania, for North American production of the Rabbit, a hot seller known as the Golf in Europe.
The Golf Mk3 and the Jetta arrive in North America, but fewer than 50,000 VWs are sold here, a record low.
The Volkswagen New Beetle and the fourth-generation Jetta (along with the 1996 incarnation of the Passat) boost sales significantly in North America. The Volkswagen Group acquires Bentley, Bugatti, and Lamborghini.
Volkswagen announces the Phaeton line, a play for the luxury market, and the Touareg, the company's first modern sport-utility vehicle.
On July 30, the final Type 1 Beetle rolls off the production line in Puebla, Mexico. Car No. 21,529,464 is immediately shipped to the Volkswagen museum in Wolfsburg.
In July, VW announces plans for a $1 billion assembly plant in Chattanooga, Tennessee. It will make cars designed for North America, including a midsize sedan to compete with the Honda Accord and Toyota Camry. On October 26, Porsche, which had been buying up VW stock, reveals a plan to assume control of VW.
Volkswagen and Porsche announce a merger on May 6. In October, VW announces it will take a 49.9% stake in Porsche for $5.75 billion. And in December, VW takes a 19.9% stake in Suzuki, a deal valued at $2.5 billion.
The History of Volkswagen | Fast Company
Volkswagen AG | Crocodyl
ABC The VW Alphabet: A type of love letter.
"VW, we still adore you;
but lust for a return to the
standards you once represented."
Perfection! Look to the recent history exhibited by masterful industrial giants like IBM, Sears, GM or . These industrial firms were once marketplace gods. They could seemingly do no wrong! They were invincible. Their management gushed truth, logic, and wisdom. They were infallible.
When a firm is seen as capable of doing no wrong, an incredible smugness develops. Among corporations, smugness causes blindness. The firm loses its way, loses its vision. Unless smugness is cured, the disease is always fatal. IBM and the other corporate Invincibles have recently swallowed huge doses of humbleness, the antidote to excessive smugness. One firm, a firm all readers of this newsletter care deeply about, is still suffering from a smugness overdose. And, why not! Volkswagen is a huge success in virtually every market except the U.S. You can almost hear VW management thinking, "See! We are a big success in Europe. Therefore, there is nothing wrong with our vision, our view! Thus, it must be the American consumer who is wrong for not liking our product!"
Now, exactly how did we define smugness earlier?
Obituaries are such a drag! Obits are always written after the prime subject is beyond caring. What if a person, or a firm, could read about their life, and analyse it for lessons or truths, BEFORE commiting the stupidities that brought their existence to an end? Right! We'd be reading a lot fewer obituaries! It is in this light that we introduce the alphabet which will be used to construct the obituary of the U.S. subsidiary of Volkswagen.
A is for Arrogance, the face VW/Audi has too often exhibited when questioned about its engineering, quality or value. Arrogance was the look flashed by those VW engineers when grilled on 60 Minutes about "sudden acceleration". The engineers were right! "Sudden acceleration" was caused by dumb, pre-occupied, ill-coordinated drivers, not the machine. Being right and humble may have saved the situation. Being right and arrogant cost VW untold numbers of customers.
B is for the Beetle, foundation of all that was to come. Where is today's broad-shouldered Beetle, a concept strong enough to support an ever expanding automotive empire? Let's see! There's the And, the Don't forget the Yikes! Not a broad shoulder among them.
C is for Corrado. Or does "C" stand for confusion? Analyze in depth the information to be learned from the success of the Beetle or Karmann Ghia. Now, put into practice all of these hard learned lessons. The Corrado would be the last car constructed using these lessons.
D is for Dasher, a well conceived car. It could have been Wolfsburg's Buick, the car to lead VW away from its nearly total dependence on a one car line up. Instead, as untold Dashers threw up a visable smokescreen, it got the undeserved reputation as the Vega of the VW product line.
E is for Emotion. Show affection for a certain brand of sump-pump, septic tank or storm door and one is likely to be committed. Padded room time fella! Yet, Volkswagen is that rare industrial firm who somehow caressed the raw, primal emotion in millions of us. We loved VW for it. But, emotion is a double-edged sword. Face rejection long enough and even blind adoration can curdle, turn sour. Vast numbers of the "faithful", rightly or wrongly, feel VW turned on them in the late '70's. The opposite of love is not hate, an admittedly powerful emotion. The opposite of love is indifference, the lack of emotion. VW! Welcome to the marketplace indifference suffered by a sump-pump.
F is for Fahrvergnugen. Congratulations VW! You came up with an advertising campaign shrilly drawing attention to VW's German roots. All fine and good if one is trying to give your product uniqueness, distancing it from all those Japanese clones. Of course, what you really did was paint a verbal "bulls-eye" on your product for all of those Americans concerned about the outcome of the Trade Wars. How do most Americans translate a term that is harsh sounding and awkward to pronounce? Why, it's simple. They think, "Buy American".
G is for Grief. Intellectually, we are all aware of the stages in the grief process anger, denial, and the rest. Few of us realized, until VW in the U.S. went on life support, the potential death of a firm could so passionately affect millions of consumers. So, please forgive me; but, "I hate you, Volkswagen. I wish you'd never been born, never come to this country. Damn! Why did I ever get mixed up with you. I should have bought a Falcon."
H is for Heirs. No doubt about it! House of Ghia is an illegitimate marketplace heir of VW of A. It's amazing! We, and dozens of firms like us in the VW restoration bizz, wouldn't exist, couldn't exist, if Volkswagen had properly serviced the restorer market. Yet, VW views us as vermin to be squashed, rather than gutsy risk-takers to be applauded for our enterprise. So, VW, the entire air-cooled restoration industry salutes you with the following painful and ironic toast, "Thanks VW! We couldn't have done it without you! Your short sightedness, stupidity and stubborness led directly to our success."
I is for Iacocca, King of the mini vans. The royal throne and the lush markets that go with it, were, for 30 years, Volkswagen's for the taking. Instead of consolidating the marketplace, VW dithered. Iacocca, in a bold move, gathered in both the title and the market. Now, VW sucks hind tit in a market it invented.
J is for Japan. Who studied the lessons of the Beetle best? Of course, the Japanese! Who lusted to grow-up and play the automotive game just like Detroit played it? Need you ask? VW's example as set down in the '50's and '60's included: 1) Avoidance of planned obsolescence; 2) An almost shrill emphasis on quality; 3) Factual advertising; 4) Favor function and substance rather than form and frills; 5) A determined attempt to add the terms honest and ethical to a description of both the firm's product and the firm itself. Let's take stock! All auto firms who followed VW's early example seem to be prospering mightily. All auto firms, including VW, who yearned to follow in Detroit's wake as laid down in the '50's and '60's, are floundering. Must be a lesson there somewhere!
K is for Karmann, as in Karmann Ghia. Time was when a true collaboration, between the Karmann firm, master-builder of automotive bodies, and VW, master builder of the stout chassis, brought into existence masterpieces. The famed Beetle cabriolet and the Karmann Ghia resulted from such a partnership. Recently, Volkswagen has been infested with the NIH virus. Not Invented Here thinking has destroyed more good ideas than any human vices except timidity and apathy.
L is for Love. Watch out VW! You are about to turn an enormous asset into vinegar. Your treatment of the American Beetle/Bus restorer has been scandalous. Except for a few pitiful and aborted attempts at cultivating the restorer, VW of A has been actively hostile to its past. Restorers are picky, fussy and demand information. Restorers take up a lot more parts-counter time than commercial body shop accounts. So, most dealerships actively discourage the restoration crowd. Sure, the average Beetle buff has an emotional attachment to the car bordering on mental illness. But, their respect for the firm that brought them this object of devotion, is, because of lack of support, tepid at best. In no time at all, the adoring restorer's attitude could change to: "Love the Beetle, hate VW".
M is for Mad-dog. VW of America attacks like a rabid junkyard dog, any firm it remotely feels is gaining marketplace advantage by using Bug or Beetle in its business name. Well and good! That's called protecting your trademark. But, VW then acts like a Doberman with a jaw full of "seat of the pants" by trotting back to its kennel and failing to ask,"Why". Why are so many business folks risking VW's wrath by "climbing the fence"? Sure! There's a large market in things Beetle; a market VW totally ignores or serves very poorly. Then again, "M" may stand for moronic.
N is for Nearsighted. When a firm's survival is threatened, its vision dims. Now rules! The present becomes paramount. Bean counters and ax wielders abound. The past becomes corrupt, unworthy of rendering advice or direction. The future is ignored. After all, if one doesn't carefully watch each step now, there will be no future. Well, here's a future for you VW! Projecting the last decade's sales rate decline into the twenty-first century means VW will be selling far fewer than twenty thousand cars in the States by the year 2001. For nearsighted "visionaries", for the "now" crowd at Volkswagen, this will be a guaranteed future. Only those business leaders with a firm eye on the horizon, and a clear understanding of how they got to this point, have any chance to change this gloomy projected future.
O is for Olives. VW's Board of Directors should insist, "All employees who wear a tie must pick up a wrench at least once a week". Of course, greasy fingernail types don't guarantee a car company can be saved from itself. But, management types whose hobby is golf with a martini are likely to day-dream solutions to problems with as much substance as how to build a golf club that dispenses olives.
P is for Pennsylvania. VW long played the irresponsible parent. Even when, decade after decade, nearly 50% of its cars were sold in America, VW still didn't produce vehicles in the States. Finally, in the '70's, after protracted foot dragging, VW built a successful plant in Westmoreland Pennsylvania. But, VW's heart wasn't with its American off-spring. The early '80's were a period when the dollar was King, heftily lording it over the Mark. Bean-counter types fed management's reluctance; and so, nearly to the hour and day when the dollar reached its zenith, VW abandoned its Pennsylvania experiment. Today, with the dollar "in the toilet", and the Mark as exchange rate King; wage rates in Pennsylvania would be financially like hiring Third World workers. VW could combine European engineering and American labor to produce, technologically and pricewise, a car to beat the Rising Sun. As it is, VW is partly being forced out of the American market by the incredible strength of German currency. Irony of ironies! Japanese auto firms are also faced with a strong yen. But, Toyota, Honda and the like built American factories and stayed. Now, guess who are the lowest cost producers of Japanese cars. Sure! American factories! Without U.S. output, Japanese cars in the States would cost thousands more. A price differential that could have, and may yet, push several Japanese firms from the American market. VW will never admit it, but management's slogan should have been "Pennsylvania, we've come to stay!"
Q is for Quark, the sleazy character on Deep Space Nine, the Star Trek spin-off. Quark is the ultimate capitalist. He oozes greed, breathes deception, promotes paranoia, and sees only the possibility of profit or loss in any situation. So, what's Quark doing in a VW alphabet? I wonder?
R is for Re-enter. Twenty years from now, when VW may want to re-enter the U.S. market, wouldn't it be priceless public relations to have the new invasion forces met at the shoreline by a welcoming army of Beetles, Buses, Ghias and Rabbits? Think about it! Peugot and Renault have each TWICE tried to invade the American market since 1950. How many millions would these firms have gladly spent to have enthusiastic owners of their previous models greet them joyously at the invasion beachhead? What would it take to have a re-entry effort met at the shoreline by an angry legion of stone-throwing restorers? Thanks to VW, we just may find out!
S is for Smile. Remember when VW was the only automotive firm - make that big firm, period- who could laugh at themselves and their products. Even a glimpse at a Beetle could unleash a sly smile. VW's warts and all advertising once brought sincere chuckles; and that rarest of all advertising emotions, anticipation of the next ad. When, and why, did the laughter die?
T is for Tattoo. Save for a certain motorcycle, the VW corporate logo has inspired more ink and needles to adorn more flesh than any other industrial symbol. In the soap and toilet paper wars, ad executives would kill to insure their product generated tattoo loyalty. And, VW? Does it analyse? Does it probe? Does it try to recreate the mood? Hardly! Like an embarrassed teenager with a hickie, VW feels if it ignores this fanatical response to its products, the "fad" will go away! Yes, indeed! Ignore it long enough, VW, and the public's unquestioning adoration of things "Volkswagen" will surely go away.
U is for Unimportant as in "There are no unimportant parts". At the autopsy of VW in the States, many factors will be seen as contributors to the firm's demise. But, no one cause will loom more important than a simple valve stem seal costing mere pennies. There is almost no way for a new car to visably announce, by itself, "I am a clunker". What could it do? Trick the owner into painting "LEMON" on its flank? Trust VW to find the one way that would announce to tens of millions of potential customers, "Our new car is flawed". VW did it by allowing nearly half a generation of water-cooled cars to throw up a hefty, oily smokescreen. There are no unimportant parts!
V is for Viking trade policies. Volkswagen, in its dealings with the U.S., has adopted the trade techniques of ancient Norse warriors. Land unexpectedly in force. Emotionally arouse the local populace to a frenze. Ship back home absolutely every scrap of booty. Leave nothing behind but illegitimate heirs. Of course, those well-known Viking trade pillagers, the Japanese, were imitating Volkswagen strategy until they were forced to leave at least some of their booty behind in the form of factories and suppliers.
W is for Wolfsburg. Once merely a place, Wolfsburg has become, like the term "Detroit", a symbol of a mind-set; a shorthand way of describing the VW empire, and often, the entire Germany auto industry. Recently, it has not been a term of flattery.
X is for Exchange rates, the all-purpose "goat" upon which VW apologists blame their troubles. A strong Mark and a weak dollar suddenly means a Dasher that sold for $4,000 in 1974, costs $12,000 for a virtually identical car in 1980. That's a recipe for marketplace disaster. Faced with being priced out of the market, did VW use its vast profits from America to build a broad, stable economic base in this country? Did it try to pump orders, and therefore Marks, from Germany to the U.S.? Nope! It acted like a teenager sharing a two straw milkshake. When the resource is noteably diminished; DRINK FASTER .
Y is for Youth. Attend a Model T or Model A old car meet. rightly assume the next vehicle many Model T restorers will be in the market for is a hearse. Now look at the tens of thousands attending a VW meet! Are these restorers middle-aged yuppies? Are these the folks who dated and mated in Beetles during the '50's and are now reliving their youth? Are these restorers who drive to the parts store in a Lexus or Caddy in the search for items for their VW "Garage Queen"? These people are young! Young! They are committed to VW's as only youth can give itself up to a cause. And, they will be the car buying public well into the year 2040! So, how does VW treat this priceless treasure that's fallen into their marketplace lap? Need you ask!
Z is for Zero, which stands for the impact VW's leaving the American market will have on the U.S. business world. Number of state-side VW factories that will close - zero. Number of bankrupt American factories supplying OE parts - zero. Number of newly destitute Americans left holding expensive regional francises to sell VW cars - zero. Change in the U.S. gross national product, unemployment rate and dividend collection rate - zero. An industrial giant walked America's business landscape and barely left a foot print. Sad!
NEWSFLASH! After this alphabet was written, VW, the mother firm, announced it lost over 950 million dollars in the first 6 months of 1993. In addition, hiring the "Grand Inquisitor" away from GM has daily placed questions about the VW firm's ethical standards onto the front page of the world's newspapers.
It may yet become a Volkswagen characteristic.