Volkswagen may end up converting the New Beetle into a family of cars with a new report claiming a second, smaller Beetle based on last year’s up! concept car could be developed for the U.S. market. The second-generation New Beetle is expected to arrive in 2011 and will take over from the current model, which should be phased out by around 2010 or 2011.

The new Beetle will be based on the upcoming Golf Mark VI platform, which will be sold in the U.S. in base GT trim or as the sporty GTI. The second-generation New Beetle, which MotorTrend reports will come with a hybrid option, will come after the new Golf and could come in a new speedster bodystyle in addition to the standard coupe and cabrio.

After the introduction of these mainstream models, the U.S. version of the up! minicar car will be launched. This new subcompact model is tipped to arrive with trademark Beetle styling. There have been rumors that the production up! may be styled as a Beetle in order to cash in on the iconic car’s popularity. However, European versions of the car are expected to resemble the concept and will most likely be sold as a replacement for the Lupo.

Combining the Beetle's brand cachet with two new fuel-efficient models may be a strategy VW is mulling over to boost sales, especially considering its North American sales fell 0.5% last year while its global figure increased by 7.9%.

2007 Volkswagen up! concept

2012 Volkswagen New Beetle renderings