SHAPING INDUSTRY FRONTIERS · AUTOMOTIVE RENEWAL
How Volkswagen avoids becoming the Trabant
The stronger lesson from Saxony is reinvention: what Glashütte’s watchmakers and Volkswagen’s own history reveal about renewing an industrial icon
When the border opened, East Germans could choose cars that made the Trabant’s protected proposition obsolete. Volkswagen helped rebuild Saxony’s automotive industry. Today, Chinese carmakers are changing customer expectations in ways that challenge Volkswagen. The useful question is how the company can lead the next transition.
One industrial story ended. Another was rebuilt
Trabant production ended in 1991, but the region’s future did not. In nearby Glashütte, East German watchmaking skills survived through the state-owned era and became the foundation for a new generation of brands after reunification. Walter Lange re-established A. Lange & Söhne in 1990 and launched its first new collection in 1994. Glashütte Original emerged from the successor to the former state watchmaking combine. NOMOS was founded in 1990 and made restrained modern design its signature.
These brands did not win by preserving an old product unchanged. They made inherited craft relevant through new ownership, product design, quality, distribution and a distinctive German proposition. They compete internationally on their own terms; the example does not imply that Saxon watchmaking displaced the Swiss industry as a whole.
Trabant / 1991
A late engine upgrade could not rescue the old proposition
Glashütte / 1990s
Craft and place became the basis of newly authored brands
Volkswagen / now
Turn engineering heritage into a renewed ownership experience
Historical comparison; watches and cars have different economics and scale
Volkswagen already knows how to change its own formula
The Golf was not a better Beetle. Volkswagen combined a new architecture, practical hatchback form, modern manufacturing and a more relevant promise for a changing society. The equivalent today cannot be one electric model or another software partnership. It must bring affordability, battery confidence, usable intelligence, rapid improvement and dependable service into one recognizable proposition.
China’s faster product cycles and integrated battery, electronics and software ecosystem can become a learning laboratory for the entire group. The challenge is to let the best practices travel from Chinese teams and partners into global Volkswagen decisions while keeping safety, quality and brand trust.
Product promise
Intelligent mobility that feels simple and attainable
Operating model
Shorter validated development and feedback cycles
Global learning
Move capabilities across markets, including back to Wolfsburg
Brand meaning
Make advanced technology useful to ordinary owners
Katalyx design agenda, not an announced Volkswagen programme
Relevance has to be earned in the product
A new slogan alone cannot rebrand an industrial icon. Volkswagen can regain significance if the customer repeatedly encounters a car that is easier to live with, improves after purchase, and offers confidence at a price more households can reach. That requires giving the future authority over legacy product, software, dealer and investment decisions.
Glashütte’s revival is a reminder that heritage is raw material, not a finished strategy. Its watchmakers transformed inherited capability into products worthy of new attention. Volkswagen has far greater resources and global reach. Its task is to make a distinctively Volkswagen version of modernity before familiarity becomes the only reason to choose it.
Recognizable
Can customers name the benefit after one drive?
Repeatable
Can the experience improve across models and years?
Accessible
Does the promise reach the volume customer?
Katalyx strategic tests
“A Trabant moment is the moment the market withdraws permission to change slowly. It is also the moment to choose reinvention.
Back to the Drawing Board
Volkswagen need not become the Trabant. It can use its own Golf history and Saxony’s watchmaking renaissance to remember the deeper lesson: rebuild the proposition while the institution still has the power to do so.
Adapted from the September 2026 Katalyx paper ‘The Roles Have Reversed’; the full paper is available on requestThe complete paper is available on request
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