Date
21 October 2019
Employees take pictures of a Volkswagen Beetle during a ceremony marking the end of production of the iconic vehicle, at an assembly plant in Puebla, Mexico, on July 10. Photo: Reuters
Employees take pictures of a Volkswagen Beetle during a ceremony marking the end of production of the iconic vehicle, at an assembly plant in Puebla, Mexico, on July 10. Photo: Reuters

Diverging fortunes of Beetle and Mini Cooper

The last Volkswagen Beetle car rolled off the assembly line last week, marking the end of an era of the iconic car whose history goes back to the 1930s.

Meanwhile BMW revealed on the same day its first all-electric Mini Cooper.

Beetle reported sales of 15,000 units in 2018, the same year when 360,000 Mini Coopers were sold. What a huge difference there has been in the fortune of these two competing German cars!

Beetle was created in 1935, a time when only 50 Germans were said to own a private car. The leader of Nazi Germany, Adolf Hitler, wanted a cheap, simple car to be mass-produced. He wanted the economy-car to have four seats, and the retail price capped below 1,000 German marks.

In 1938, the first Beetle car was manufactured, and Hitler called it Kraft-durch-Freude-Wagen (“Strength Through Joy Car”). The car was priced at 990 German marks as Nazi government subsidized half of the production costs. This “People’s Car” was made available to citizens of Germany through a savings scheme.

To meet the tight budget, Volkswagen tried all means to reduce the length and weight of the car, which got its nickname as Beetle due to its utilitarian design.

Beetle later became the official name of the budget car. Thanks to the warm reception in UK and US markets, Beetle became a globally popular car.

After famous UK rock band Beatles were pictured in a Beetle car in a cover photo for a music album, the car became an emblem of the hippie era in America.

Beetle cars became bestselling vehicles worldwide in 1968, with 1.13 million units sold, after it starred in a Disney movie as Herbie the “Love Bug.”

Beetle cars were still one of the most sought-after cars until 1980s. However, the brand gradually lost its luster amid the rise of Japanese rivals, and intensifying competition from other brands and new models such as SUVs and 7-seaters.

By comparison, Mini Cooper introduced different designs such as ALL4, Countryman, Clubman, Roadster and SUVs to cater for changing market demand. It keeps offering something fresh for customers rather than sitting on the legacy.

The new Mini Cooper SE is the brand’s first purely electric small car, and will start mass production in November this year.

The new electric car is expected to be priced at around US$30,000, slightly below the US$35,000 to US$45,000 range of Tesla Model 3. It’s reported that the model has already received over 40,000 pre-orders.

To survive and thrive, a company has to change with the times. In this regard, Beetle failed.

This article appeared in the Hong Kong Economic Journal on July 12

Translation by Julie Zhu

[Chinese version 中文版]

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 RC

Hong Kong Economic Journal columnist