Volkswagen, second-largest car maker in the world after Toyota, had been tinkering for two decades with a simple, compelling idea: design an updated version of the Microbus, the iconic ride of the 1960s “flower power” generation and one of the best-selling vehicles of all time. It should have been a no-brainer.
Volkswagen had banked on riding a wave of nostalgia for a treasured symbol of 1960s hippie counterculture as a gambit to refresh the brand and try to broaden its shrinking share of the prized U.S. auto market. For more than 50 years, the company has tried and failed to breech its peak of 7%, set when the Microbus was a Boomer favorite way back when.
The bus and its older sibling, a micro-passenger car dubbed the Beetle or Bug, were part of a phenomenal marketing campaign complete with clever, self-deprecating ads. In one ad it pitched to families with children, the flat, hoodless front of the Microbus was described as “a face only a mother could love.”
It was smart, thrifty, and hip to drive a Microbus.
From the late 1950s through the 1970s the Microbus was among the better-selling imported vehicles in the U.S., in the process shaping the culture of a generation and blazing a trail for vans and campers.
Like the Beetle, the Microbus boasted then-unheard of fuel efficiency—averaging 24 miles per gallon—and it was affordable. The base price for the VW bus in 1970, the peak year for unit sales in the US, was about $2,500, equal to about $21,000 today when adjusted for inflation. The best-selling car at the time, the Ford Galaxy, cost more than $3,000.
The Microbus appealed to thousands of families with young children, Boomers with wanderlust, and hipsters with disdain for Detroit’s gas-guzzling muscle cars. Of the roughly six million produced worldwide, more than 800,000 were sold in the U.S. between 1955 and 1979. Assuming those 800,000 had more than one owner, there potentially could be a couple of million Americans who’d have a soft spot in their hearts for an updated edition. It was a natural branding opportunity.
Volkswagen teased the notion in 2001 with a picture of what a reimagined Microbus might look like. According to a company announcement at the time, the concept Microbus “was designed in the Volkswagen design studio in California especially for the U.S. market.” A flurry of interest came and went, but no car went into production.
Fast forward to 2016.
At a Las Vegas consumer electronics show that year, company executives offered a hopeful plan for a new and improved VW bus. It would be an affordable all-electric vehicle called the Budd-E. Another flurry of interest came and went, but still no car.
It would be eight more years before the new Microbus finally debuted in the U.S., last Thanksgiving. In the interim came the Tesla juggernaut and the surge in demand for all-electric vehicles. Between 2016 and 2024, while VW was dithering its way through the design and production process of its reboot—renamed the ID.Buzz—Tesla sold nearly 7.25 million electric vehicles and China flooded the global market.
Across the U.S. auto-verse, industry experts and reviewers had been eager to get their hands on the new Microbus and give it a test drive. The nostalgia factor was strong. Auto enthusiasts were rooting for it. But Americans were losing interest in all-electrics.
In spite of polls that showed up to 40% of American consumers “interested” in EVs, a First Insight survey in 2022 found that only one in seven Americans said they would actually consider buying one. Today that number is even smaller.
The single biggest obstacle to EV adoption has been range anxiety, whether real or imagined. U.S. drivers don’t like to have to plan their itinerary around charging opportunities. In a country where there is a gas station on just about every corner, why risk running out of watts?
So, reviewers and auto industry analysts were stunned to learn that the range of the ID.Buzz was E.P.A.-rated at only 230 miles (versus about 300 miles for a Tesla). Actual tests found that, at highway speeds, the new Microbus couldn’t even go 200 miles without a charge.
Additionally, the new bus was priced at between $60,000 and $70,000 depending on options, putting it up against luxury SUVs. This was not the smart, frugal, hip ride that was the foundation of VW’s original popularity of the Microbus. Hundreds of disappointed fans vented on subreddit r/electricvehicles: “VW ID buzz – why is it not working out in the U.S.?”
According to published reports, sales of the ID.Buzz in the U.S. have been predictably lackluster: fewer than 2,000 in the first quarter this year, and fewer than 1,000 in the second. Globally however the car is said to be selling faster.
Somehow, it seems that VW managed to miss the point of its own origin story at least with the US market. As one reviewer wrote, “The original Microbus is one of those iconic cars that was born from entirely practical considerations, and all of the character and personality and soul that it developed over the years was an unintended side effect of just being such a useful, unpretentious machine.”
This might have been a different story had VW further observed how Toyota has managed its power systems and perhaps engaged consumers to understand their needs and concerns.
Toyota began producing its ubiquitous economy hybrid, the Prius, in 1997. Toyota dodged the range issue completely. Today, the majority of Toyota’s car sales are hybrids and last year the Prius was named the “greenest” car in the U.S. by the American Council for an Energy Efficient Economy. Globally, the company has sold more than 6 million.
Marketing cars is subject to the same rules of retail engagement as selling lingerie or throw pillows or smart phones. Success comes to companies that deliver what customers have said they want (and need), at a price they are willing to pay. As things look, that’s may be a very expensive lesson for a number of companies.