Volkswagen AG officials expected June sales of its New Beetle to rebound into the range of 8,000 to 10,000, but May was a disaster.

Sales of the supposedly hot car tumbled 42% from 4,870 in April to 2,730 in May after the company recalled about 10,000 cars.

It is installing redesigned battery trays. The original trays were, in some cases, cutting through wiring in a way that could create a fire hazard. At its Puebla, Mexico, assembly plant, VW is having problems matching the yellow and silver paints on its metal and plastic parts. One company official says the plant's altitude and thinner air is contributing to the problem. Time will tell whether consumers will except that explanation. After two years of showing its Composite Vehicle concept, Chrysler Corp. has contracted with Husky Injection Molding Systems of Novi, MI, to build a production prototype of the low-cost car Chrysler envisions for emerging markets. By molding in the colors of the panels, Husky hopes to demonstrate how Chrysler could save hundreds of millions of dollars by avoiding the expensive stamping and paint shop technology required to build a conventional steel-body vehicle. It also would require between eight and 12 body panels. In contrast, a conventional steel-body car requires an average of more than 80 metal parts.

Husky will build a new research and development center in Novi that should be able to start producing the car bodies by July 1999.

So far, Chrysler has used the boxy small car it calls the CCV (Chrysler Composite Vehicle) as the primary test bed for this technology. Last January at the North American International Auto Show, Chrysler also showed prototypes of its hybrid-electric ESX 2, Pronto and zippy Pronto Spyder concepts as other possible applications for the composite body.

Larry Oswald, executive engineer for advanced body engineering, predicts it will be three years before Chrysler has enough confidence in the technology to invest $10 million or more in a new set of molds.

The Dodge Intrepid ESX 2 illustrates what Chrysler can achieve through its Composite Vehicle concept.