The Type 3 emulated major features of the
Type 1 Beetle, using a low-profile version of Volkswagen's rear-engined, 4-cylinder air-cooled engine, as well as body-on-chassis construction (the body bolts to a frame that includes the floor pan), retaining the same wheelbase – but using more contemporary and slab-sided
Ponton styling, in contrast to the Type 1's articulated fenders and running boards. VW finalized the design by 1959, with prototypes ready for testing by 1960. Secrecy was so tight that even at the 1960 Geneva Auto Show, VW denied they were preparing a new design. In 1961, VW announced the new line as the "VW 1500". Production began in August 1961, a month before launch, of the Volkswagen 1500 Notchback, encompassing
three-box styling in a
Notchback saloon body. Production of the
Karmann Ghia 1500 (also known as the
Type 34 Karmann Ghia) with a
coupé body commenced in November 1961 and deliveries started in January 1962. The
Fastback, or
TL version, a
fastback coupé, arrived in August 1965, along with the 1600 engine. Volkswagen's intention was that this model should replace the Notchback, which is what happened in the UK market. However, in other markets, including the German domestic market, the number of customers preferring the older Notchback shaped car was higher than foreseen, and in the end both Notchback and Fastback remained in production until July 1973. Type 3s were made in a variety of trim levels with different features for different markets. Top end models featured more chrome, more bright trim, and full carpeting, and, starting in mid-1968, were available with a fully automatic transmission. Factory installed gasoline powered heaters were an option available in some markets. Air conditioning and radios were never factory installed but were often available as dealer installed options.
Volkswagen of America began marketing the Type 3 Squarebacks and Fastbacks for the 1966 model year, but they never imported the Notchback or Type 34 Karmann Ghia. The Type 3 was competing in the market with the
Chevrolet Corvair that had been previously introduced in the United States in 1960, which incorporated a 6-cylinder rear-mounted air-cooled engine in notchback and station wagon body style, as well as
a compact van and pickup derived from the platform. It also competed in the US with the
Renault 8 which also offered a rear engine and rear drive sedan. A unique feature of all four Type 3 models was that configuration of the flat 4 engine gave the cars both front and rear luggage volumes; a fact highlighted in VW's advertising. For the 1968 model year, the Type 3 1600E (
Einspritzung) models were the first mass-produced automobiles with electronic fuel injection available as optional equipment. This was the introduction of the Bosch
D-Jetronic fuel injection, which was available only in VW Type 3s for its first two years. The 1600 cc
D-Jetronic fuel injection engine was standard equipment for all Type 3s sold in the US for model years 1968 thru 1973, but single and dual carb engines remained as available options for many markets around the world until the end of Type 3 production. In mid-1968, a three-speed fully automatic transaxle became available. With the automatic came a CV-jointed independent rear suspension (IRS), replacing the swing axle (also IRS) set-up. This 1968 mid-year introduction was only available in conjunction with the dual carb 1600 cc Type 3 engine. For 1969, the CV-jointed rear axle became standard with both automatic and manual transmissions, and the automatic transmission was also offered combined with the D-Jetronic 1600 cc fuel injection engine. The swing axle rear suspension remained available for some markets that had poorer quality roads. Type 3 models received a
facelift in 1970, with a revised front end, its nose extended by adding to the luggage capacity. At the same time Type 3s received revised square-section bumpers (with integral rubber strips in some markets), as well as larger tail lamps and front indicators. Volkswagen offered the Type 3 in a lower trim level in Europe, marketed as the
1600A. In the US, and for 1973 only, Volkswagen of America offered two trim levels of the Type 3 Fastback in the US, marketed as the
Type 3 Sedan and
Type 3 Basic Compact. The Basic Compact trim level featured reduced content, including limited color and upholstery availability; deletion of exterior belt line chrome trim, clock, and electric-heated rear window defogger—and using painted vent widow frames, a black cardboard front trunk liner over the gas tank without a liner on the sides of the trunk or over the firewall, and plain vinyl door panels without door pockets and rubber mats in lieu of interior carpet. While the Type 3 was a more modern design, it never reached the same level of popularity as the Beetle. As Volkswagen started to produce front-wheel-drive water-cooled designs, production ended in 1973 at the
Wolfsburg plant. The Wolfsburg production facilities were then retooled to build the
Golf, known as the
Rabbit in the US., which eventually replaced the Type 1 as Volkswagen's best-selling sedan. Production of the Type 3 moved to VW's new
Emden plant, which was retooled later in 1973 to build the
first-generation Passat (also marketed as the "Dasher"). File:Volkswagen 1600 TL (fastback).jpg|Volkswagen 1600 TL Fastback File:Volkswagen Type 3 Cabriolet (1961) Classic-Gala 2021 1X7A0088.jpg|1961 convertible prototype File:Volkswagen Type 3 BW 2016-09-03 13-28-39.jpg|1600 Fastback File:1969 Volkswagen 1600 Type 3 Squareback (17106727491).jpg|1600 Variant/Squareback File:VW Typ 3 1600 L2012-07-15 14-42-30.JPG|1500 Notchback ==Engine and drivetrain==