Beetle Mania


A Michigan couple visiting their daughter in San Diego canceled their return flight and drove home instead--in a new red Beetle they fell for the moment they saw it at a Volkswagen dealership.

In Norwalk, the Volkswagen dealer's first new Beetle went to the winner of a bidding war that took place on the showroom floor. The bemused salesman didn't have to lift a finger, said dealership owner Danny McKenna, as the determined customers bid up the price from $16,680 on the sticker to almost $22,000.

An Irvine executive spent hours calling more than a dozen Southern California VW dealerships, offered to pay $1,000 extra if the dealer would hold the car for him, then drove nearly two hours to Woodland Hills to pick it up.

And so it goes in the great Beetle hunt.

For the first time in decades, Volkswagen has a car people are lining up to buy. But the car maker's only Beetle factory, in Puebla, Mexico, can't make them fast enough. Meanwhile, the waiting lists for the new Beetles keep growing, with many dealers taking deposits from 50 or more customers.

"I'm telling people who want on my list now that they're probably looking at August before they'll get a car," said Mark White, sales manager at Volkswagen of Van Nuys. "It would be a luxury for us to get a car that we could hold long enough to put into our showroom."

He said the dealership now has taken $500 deposits from 85 people.

The shortage exists, VW officials say, because the company underestimated the initial demand for the helmet-shaped Beetle and didn't start to produce the new cars soon enough.

Volkswagen had planned to sell 50,000 new Beetles in the U.S. the first year but recently upped the target to 60,000. Only about 4,000 will have been shipped by Tuesday, though--an average of fewer than seven cars for each of the company's 599 U.S. dealers.

"The way they're getting cars to dealers is absolutely perplexing," says Leo Bunnin, owner of the Woodland Hills VW store. He said he has only received four cars in the three weeks since Volkswagen began shipping them.

There is hope, though, for Bug fanatics who aren't on a waiting list--if they aren't picky. Some dealers say they're getting cars that don't match the preferences of customers who placed advance orders and seem willing to wait until the color and options package they wanted comes in.

So people willing to spend time calling dealers--as George Bregante did--may stumble into a deal.

Bregante, president of Irvine-based medical managed-care provider Beech Street Corp., decided that he wanted the new Bug for old-times' sake. "I've had five of them at various times in the 1960s and '70s," he said, "and my wife had several too. We decided to buy a new one and share it."

He started calling two weeks ago and first found one at McKenna's Huntington Beach dealership, but he was put off by the $21,868 quote the salesman faxed to his office.

McKenna insists that the quote wasn't a case of price gouging. The salesman, he says, failed to inform Bregante that the car was specially equipped by the dealer with custom wheels and tires, a compact disc player and other options.

After a dozen more calls, Bregante hit pay dirt at Volkswagen of Woodland Hills, where a red Beetle had just come in and been turned down by the two dozen people on the dealership's waiting list. The car was selling for $16,680.

"I told them I'd pay $1,000 more than that if they'd agree to hold it till I could get there," Bregante said. Then, to make sure he had a deal, Bregante gave the salesman his credit card number over the phone and told him to charge the entire purchase price.

"We love it," he said Friday. "It draws a crowd whenever we stop. My wife told me she's met more people in the last four days than in the four years before that."

Craig Sanders, general sales manager at Timmons Volkswagen in Long Beach, says two of the five new Beetles his store has received so far were turned down by customers on the waiting list. But they were snapped up within minutes--one by a man who drove by as the Bug was rolled into the showroom and one by a Big Bear resident who was calling dealers from his car phone as he scoured the Southland.

Sanders and other dealers said most of the customers on their waiting lists want colors, such as silver and yellow, that the factory hasn't rolled out yet. Because the profit margin on the cars is small, many dealers are taking advantage of the demand by equipping the cars with highly profitable accessories like compact disc players and spray-on paint and fabric protector. The accessories typically add from $700 to $1,500 to the sticker price.

Some of the priciest Bugs in Southern California apparently are at McKenna's dealerships, although the dealer also sells more modestly priced Bugs than the $21,868 model he offered Bregante.

"We have to accessorize to make money on a car we can't sell in volume," says McKenna, who also sells Porsches and BMWs. "But we are giving customers value for their money."

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