Adolf Hitler’s ambition dream of bringing the automobile to the German people gave rises to idea of developing and manufacturing a people car. The initial aim was to manufacture a cheap car that a average worker could afford. VW was establishing as a state owned unity with the sole intention of producing the people’s car. The car was developed by 1936 and Hitler’s named it ‘Strength through Joy’. A site for the new factory was selected and it was initially known as kdf stadt now know as Wolfsburg. But with onset of WW2 the production was stopped and the factory converted for Luftwaffe. The Wolfsburg factory started helping the Luftwaffe in production of the Ju-88 aircraft. Over the coming years the peoples car platform was used to build vehicle for the German Military. The factory being a strategic military location was heavily bombed by the American air force. At the end of the WW2 the factory came under the British Army. The British army tried selling the manufacturing plant to British car manufactures that rejected the proposition by claim the technology and the design to be outdate and of no worth. The American manufacturers also shared the same view, so it was left to the British Army to revive the plant. Major Ivan Hirst who was in charge of the region saw great opportunity in the small car and persuades his superiors to allow the factory to start manufacturing of VW beetles again.
Heinz Nordhoff who would head the company for 20 year of growth was recruited by Major Ivan Hirst. In the first year of production after the war a small batch of 55 Beetles were made. The Wolfsburg factory was handed over to the Federal Government in 1949. The company started to look beyond the German boundaries for exporting the Beetles and found more than expected demand for the quirky little car.
The beetle production reached a million units in 1955 and then started a journey of unprecedented growth. The production kept increasing by year on year basis and a couple of new factories were also added to its existing one at Wolfsburg. Through the 50’s and the 60’s the sales of beetle kept increasing and it even surpassed Model T to become the highest selling model of all time. A very important feature in the beetle success way VW never did any major technological changes to its original design. It only kept improving the beetle on yearly basis. This brought the cost substantially down.
In January 1965 VW acquired Auto Union makers of Audi from Daimler-Benz and gets its first brand that would be much of a success in the years to come.
VW through all these years of success was essentially a manufacturer of a single model with outdated technology of air cooled engine. It recognized the need to look beyond the beetle. It introduced Golf in 1974 and it became even more successful than the beetle in the coming years.
VW was the largest foreign manufacturer in the United States up until 1975. VW lost the position it once enjoyed to the Japanese manufacturer. It went through a period where it had serious quality issue and the sales of VW Rabbit never really took off. In the mid 80’s VW shut down its American operation and shipped it to China.
In the 90’s VW started acquiring different brand in its quest to further increase in market share. It brought the troubled Czech manufacturer. It also by now had a majority stake in Spanish manufacture SEAT. It acquired Rolls-Royce and Bentley. After a legal battle with BMW it had to give away Rolls-Royce but got to keep Bentley. It also acquired the defunct Bugatti from its Italian owners.
VW has come a long way from being just a single make manufacture to becoming the Volkswagen group. Today VW group is the 3rd largest manufacture in the world having 12 different brands. It built 9.276 million vehicles in 2012 that roughly corresponds to about 12.8% market share of the world passenger cars. The VW group operates 106 manufacturing plants and has sells it vehicle in 153 countries.
The VW story by Jerry Sloniger.