VW — Back to the Roots

The Original

It was not the Beetle. It was not the Golf. The first vehicle that Volkswagen mass-produced and that actually survived the war was the Kübelwagen — the Type 82, designed by Ferdinand Porsche, built in Wolfsburg from 1940 onwards, produced in more than 50,000 units for the Wehrmacht. Lightweight, air-cooled, cross-country capable, repairable. An instrument of destruction, from the same factory that would later produce the Beetle — the symbol of innocence, of new beginnings, of the German economic miracle.

The plant in Wolfsburg was laid in 1938, on Adolf Hitler's orders, as the "City of the KdF-Wagen at Fallersleben." The KdF-Wagen — Kraft durch Freude, Strength Through Joy — was the civilian promise: a Volkswagen for every German worker, save five marks a week, and eventually the car is yours. Not a single KdF-Wagen was ever delivered to a saver. The money stayed with the regime. The factory built armaments. The Beetle came only after the war — under British military administration, then under Heinz Nordhoff, as an export article and eventually as the embodiment of what Germany had become from the ashes.

This history is well known. But it is relevant. Because the factory in Wolfsburg now faces another choice.

The Present

Volkswagen is in the deepest crisis of its postwar history. The company, until recently Europe's largest automaker, is posting sales declines worldwide. The Chinese market, for decades the growth engine, is collapsing — Chinese electric vehicle manufacturers have simply overtaken the German incumbents, faster and cheaper. The United States remains a chronic problem after the diesel scandal and Trump's tariffs. The home market is stable but shrinking.

The numbers are brutal: 35,000 jobs to be cut in Germany alone. At least three of ten German plants face closure. Dresden already shut down production at the end of 2025. The Wolfsburg flagship plant is working its capacity downward. The employment guarantee, untouched since 1992, was terminated in 2024. S&P's rating outlook is "negative." An insider summarised the situation at the January 2026 internal retreat in one word: burning.

Management is looking for new fields. That is the moment when history returns.

The Demand

At the same time — in the same hour, in the same republic — Germany is experiencing the largest rearmament boom since the founding of the Federal Republic. The defence budget for 2026 stands at 108 billion euros — the highest military budget in the country's history. The Bundeswehr plans procurement totalling 377 billion euros. Project "Arminius" alone — a framework contract for Boxer wheeled armoured vehicles — has a volume of 40 billion euros. Chancellor Merz has set the objective: Germany is to become again the strongest conventional military force in Europe.

What does an army need? Among other things: vehicles. Light, fast, robust, low-maintenance vehicles. Cross-country capable. In large quantities. Made by companies that master mass production.

Volkswagen masters mass production. Volkswagen has spare capacity. Volkswagen has plants searching for a new product. The geometry of the situation is unmistakable.

The Circle

It would be a punchline of history too crude to believe — had history not demonstrated a well-documented preference for crude punchlines. The factory built for Hitler's Volkswagen, that produced Kübelwagen in the war, that became the symbol of civilian prosperity in the economic miracle — that factory might, eighty years later, be standing at the beginning again.

Of course the parallel is not exact. There is no forced labour today, no politics of annihilation, no war of aggression. The context is fundamentally different. What Europe is now building is — at least in its stated purpose — a defensive capacity against an actual aggressor. That is a different chapter from 1938.

And yet something remains that cannot be argued away: the structural logic. When civilian demand collapses and the state builds military demand, production capacity follows the money. That is not a moral judgement. It is economics. And economics has no memory.

The economic miracle was the era in which Germany forgot what its industry had originally been built for. Now it is remembering — not out of malice, but because the market wills it.

What the Beetle Meant

The Beetle was more than a car. It was the promise that industry and mass production could stand on the right side of history. That a plant that built weapons in wartime could be converted — into an instrument of prosperity, of peace, of everyday life. This belief shaped the Federal Republic. It shaped Europe. It was the core of the West German postwar consensus: we build cars, not weapons. We export Beetles to Mexico and Golfs to America. We are harmless.

That consensus has been crumbling for years. Not because anyone consciously abandoned it — but because the conditions that made it possible have changed. Peace in Europe was not a given; it was a political project. When that project began to fail — first in Ukraine, then in the posture of the United States under Trump — the industrial consensus too had to re-sort itself.

Rheinmetall is today worth more than VW. That is not an anecdote. It is a structural indicator.

The Open Question

It is not certain that VW will actually build Kübelwagen — neither literally nor in the shape of modern military vehicles. There are other candidates: Rheinmetall, KNDS, Artec, specialised defence contractors who know the route into the new procurement landscape. VW is not a defence company and will not transform itself into one overnight.

But the question remains: what does an automotive group do when its civilian markets collapse, in a country that is massively rearming? What does it do with empty halls and a workforce that needs work? What does it do when the state demands vehicles in quantities no specialist firm can supply alone?

The answer will not be spoken aloud. But it will be found. That is the way such decisions have always been made in industrial history: not as a matter of principle, but as a gradual adaptation to what is currently being paid for.

Back to the roots — that sounds like a new beginning, like honest self-renewal, like finding firm ground again. In Wolfsburg, that phrase carries a specific historical weight. The factory knows what its roots are. The question is whether it wishes to remember.