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===1932–1944: People's Car project=== Volkswagen was established in 1937 by the [[German Labour Front]] ({{langx|de|link=no|Deutsche Arbeitsfront}}) as part of the [[Strength Through Joy]] ({{langx|de|link=no|Kraft durch Freude}}) program in [[Berlin]].<ref name="chronicle">{{Cite book|title=Volkswagen Chronicle |editor1=Manfred Grieger |editor2=Ulrike Gutzmann |editor3=Dirk Schlinkert |publisher=Volkswagen AG |year=2008 |series=Historical Notes |volume=7 |isbn=978-3-935112-11-6 |url=http://www.volkswagenag.com/vwag/vwcorp/info_center/en/publications/2008/05/chronicle.-bin.acq/qual-BinaryStorageItem.Single.File/HN7e_www2.pdf |access-date=21 December 2009 |archive-url=https://web.archive.org/web/20101216072143/http://www.volkswagenag.com/vwag/vwcorp/info_center/en/publications/2008/05/chronicle.-bin.acq/qual-BinaryStorageItem.Single.File/HN7e_www2.pdf |archive-date=16 December 2010 }}</ref> In the early 1930s, cars were a luxury—most Germans could afford nothing more elaborate than a motorcycle, and only one German out of 50 owned a car. Seeking a potential new market, some car makers began independent "people's car" projects – the [[Mercedes-Benz 130|Mercedes 170H]], [[BMW 3/15]], [[Adler 2.5-litre|Adler AutoBahn]], [[Steyr 50|Steyr 55]] and [[Hanomag]] 1.3L, among others. The growing trend was not nascent; [[Béla Barényi]], a pioneering automotive engineer, is credited as already having conceived the basic design during the mid-1920s. [[Josef Ganz]] developed the Standard Superior (going as far as advertising it as the "German Volkswagen"). In Germany, the company [[Hanomag]] mass-produced the [[Hanomag 2/10 PS|2/10 PS]] "Kommissbrot", a small, cheap rear-engined car, from 1925 to 1928.<ref>{{cite web|last=Miller|first=Elan|url=http://www.jpost.com/JewishWorld/JewishFeatures/Article.aspx?id=154651|title=Was Hitler's Beetle designed by a Jew?|newspaper=The Jerusalem Post|date=13 September 2009|access-date=18 February 2013|archive-url=https://web.archive.org/web/20130523125036/http://www.jpost.com/JewishWorld/JewishFeatures/Article.aspx?id=154651|archive-date=23 May 2013|url-status=live}}</ref> Also, in Czechoslovakia, the [[Hans Ledwinka]]-designed [[Tatra T77]], a very popular car amongst the German elite, was becoming smaller and more affordable at each revision. [[Ferdinand Porsche]], a well-known designer for high-end vehicles and race cars, had been trying for years to get a manufacturer interested in a small car suitable for a family. He built a car named the "Volksauto" from the ground up in 1933, using many popular ideas and several of his own, putting together a car with an air-cooled rear [[Internal combustion engine#Reciprocating engines|engine]], [[torsion bar suspension]], and a "beetle" shape, the front bonnet rounded for better [[aerodynamic]]s (necessary as it had a small engine).<ref name=SmallWonder>{{cite book|last=Nelson|first=Walter|title=Small Wonder|year=1967|publisher=[[Little, Brown & Company]]|page=333}}</ref> [[File:VW logo during the 1930s.svg|thumb|right|upright=0.6|VW logo during the 1930s, initials surrounded by a stylised cogwheel and a spinning propeller that looked like a [[swastika]]<ref name=Spiegel/><ref name=Stehr/>]] In 1934, with many of the above projects still in development or early stages of production, [[Adolf Hitler]] became involved, ordering the production of a basic vehicle capable of transporting two adults and three children at {{convert|100|km/h|mph|0|abbr=on}}. He wanted a car every German family would be able to afford.<ref name=SmallWonder /> The "People's Car" would be available through a savings plan at {{Reichsmark|990|link=yes}} (US$396 in 1938)—about the price of a small motorcycle (the average income being around {{Reichsmark|32}} a week).<ref name="RiseFall">{{cite book|last=Shirer|first=William|title=The Rise and Fall of the Third Reich|edition=Touchstone|location=New York|publisher=[[Simon & Schuster]]|date=1990}}</ref><ref name="LastBeet">{{cite web|url=http://www.lasteditionbeetle.com/history.php|archive-url=https://web.archive.org/web/20080306113930/http://www.lasteditionbeetle.com/history.php|title=Last Edition Beetle: History|archive-date=6 March 2008|website=Lasteditionbeetle.com|access-date=22 September 2015}}</ref> It soon became apparent that private industry could not turn out a car for only {{Reichsmark|990}}. Thus, Hitler chose to sponsor an all-new, state-owned factory using Ferdinand Porsche's design (with some of Hitler's design suggestions, including an air-cooled engine so nothing could freeze). The intention was that German families could buy the car through a savings scheme (''"{{lang|de|Fünf Mark die Woche musst du sparen, willst du im eigenen Wagen fahren}}" – "Five Marks a week you must set aside, if in your own car you wish to ride''"), which around 336,000 people eventually paid into.<ref>{{cite journal|last=König|first=Wolfgang|title=Adolf Hitler vs. Henry Ford: The Volkswagen, the Role of America as a Model, and the Failure of a Nazi Consumer Society|journal=[[German Studies Review]]|volume=27|number=2|date=2004|pages=249–268|doi=10.2307/1433081 |jstor=1433081|issn=0149-7952}}.</ref> However, the project was not commercially viable, and only government support was able to keep it afloat.<ref>* {{Cite book|author-link=Adam Tooze|first=Adam|last=Tooze|title=The Wages of Destruction: The Making and Breaking of the Nazi Economy|url=https://archive.org/details/wagesdestruction00tooz|url-access=limited|location=London|publisher=Allen Lane|year=2006|isbn=978-0-7139-9566-4|page=[https://archive.org/details/wagesdestruction00tooz/page/n175 154]}}</ref><ref group="Note">Tooze notes: "Even if the war had not intervened, developments up to 1939 made clear that the entire conception of the 'people's car' was a disastrous flop." ''Tooze (2006) p.156''.</ref> Due to the outbreak of war in 1939, none of the participants in the savings scheme ever received a car. In 1950, a lawsuit was issued that, after 12 years of trial, ultimately provided a credit of 12% off the list price of a new VW base model or 5-times less the value paid into the saving scheme.<ref>{{cite web |url=https://www.krause-papierwerke.com/post/kdf-wagen-savings-booklet |title=KDF-Wagen Savings-Booklet with Savings Stamps (Sparkarte mit Sparmarke). VW Beetle predecessor |date=6 September 2018}}</ref> Prototypes of the car called the ''KdF-Wagen'' (from the German term ''Kraft durch Freude'', meaning "[[Strength Through Joy]]") appeared from 1938 onwards. The first cars had been produced in [[Stuttgart]]. The car already had its distinctive round shape and [[Air-cooled engine|air-cooled]], [[Flat-4|flat-four]], [[Rear-engine design|rear-mounted engine]]. The VW car was just one of many ''[[Strength Through Joy|KdF]]'' programs, which included things such as tours and outings. The prefix {{lang|de|Volks}} ("People's") was not just applied to cars, but also to other products in Germany—the ''[[Volksempfänger]]'' radio receiver for instance. On 28 May 1937, ''Gesellschaft zur Vorbereitung des Deutschen Volkswagens mbH'' ("Company for the Preparation of the German Volkswagen Ltd."), or ''Gezuvor''<ref name="porsche-75">{{cite web |url=https://press.pl.porsche.com/download/prod/presse_pag/PressBasicData.nsf/Download?OpenAgent&attachmentid=166917 |archive-url=https://web.archive.org/web/20160923153859/https://press.pl.porsche.com/download/prod/presse_pag/PressBasicData.nsf/Download?OpenAgent&attachmentid=166917 |archive-date=23 September 2016 |title=Seventy-Five Years Ago: Porsche Receives the Order to Construct the Volkswagen|date=16 June 2009|website=porsche.com|publisher=[[Porsche AG]] |access-date=22 January 2010}}</ref> for short, was established in Berlin by the ''[[Deutsche Arbeitsfront]],'' the national labour organization of the Nazi Party. More than a year later, on 16 September 1938, it was renamed to ''Volkswagenwerk [[GmbH]]''.<ref name="Odin, L.C. 2015">Odin, L.C. ''World in Motion 1939 – The whole of the year's automobile production''. Belvedere Publishing, 2015. ASIN: B00ZLN91ZG.</ref><ref>{{cite web|url=http://www.hillsideimports.com/vw-history/brief-history-volkswagen|title=A Brief History of Volkswagen|website=hillsideimports.com|access-date=10 March 2015|archive-url=https://web.archive.org/web/20150310221809/http://www.hillsideimports.com/vw-history/brief-history-volkswagen|archive-date=10 March 2015|url-status=live|date=6 January 2014}}</ref> [[File:VW Typ 83 vr.jpg|thumb|VW Type 82E]] [[Erwin Komenda]], the longstanding [[Auto Union]] chief designer, part of Ferdinand Porsche's hand-picked team,<ref name=SmallWonder /> developed the car body of the prototype, which was recognisably the [[Volkswagen Beetle|Beetle]] known today. It was one of the first cars designed with the aid of a [[wind tunnel]]—a method used for German aircraft design since the early 1920s. The car designs were put through rigorous tests and achieved a record-breaking million miles of testing before being deemed finished. The construction of the new factory started in May 1938 in the new town of "Stadt des KdF-Wagens" (renamed [[Wolfsburg]] after the war), which had been purpose-built for the factory workers.<ref name="Odin, L.C. 2015"/> This factory had only produced a handful of cars by the time war started in 1939. None were actually delivered to any holder of the completed saving stamp books, though one Type 1 Cabriolet was presented to Hitler on 20 April 1944 (his 55th birthday).<ref name="Odin, L.C. 2015"/>
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