Yugo Is Planning a Comeback. Yes, Yugo

1. By the time it ended its run, the name, “Yugo,” had become more of a punchline than an automotive brand. But there’s a distinct possibility that what was once the cheapest brand available in America just might be making a comeback. Headlight.News has the story.

 

It was boxy, badly built, and could barely reach the speed limit, but there still were plenty of buyers for the Yugo brand back in the 1980s. That is, until one got blown off Michigan’s Mackinaw Bridge and demand suddenly dried up.

Now, 33 years after the last one was sold in the U.S., might the brand be ready to make its return – even if Yugoslavia, the country it was named for, is long gone? The answer, apparently, is yes.”

A teaser image was released a few months back and, now, a 1:5 scale model concept, based on a design by at Serbian designer Darko Marčeta, has been unwrapped. And while it is clearly modern in many ways, the show car is surprisingly reminiscent of the original Yugo.

The original Yugo

Nearly a decade before the collapse of the Soviet empire, what was then Yugoslavia needed a car for the masses and the Yugo was born. It was based on a shortened version of the Fiat 128 and with its 55-horsepower motor debuted in the U.S. in 1980 at $3,995 – less than half the price of any other vehicle on the market at the time.

It was brutal in its design, made to be manufactured as cheaply as possibly by Zastava Automobiles. And even in that less demanding era, production quality was poor, at best. But there was enough of a demand for affordable vehicles to justify its import by Malcolm Bricklin, an American entrepreneur who had also launched Subaru in the U.S. market.

By the time of the crash on the Mackinaw Bridge, though, Yugo’s reputation had simply taken too many hits. It vanished from American showrooms in 1989 – though Zastava continued to produce the subcompact, even as Yugoslavia broke up and its various states went to war. Production officially ended in November 2008.

The “New Yugo”

These days, with the typical new vehicle sold in the U.S. coming in just under $50,000, according to Cox Automotive, there’s a definite need for more affordable vehicles. We last month saw one new entrant hoping to step into that void, Michigan-based Slate Automotive revealing a long-rumored, stripped-down battery-electric vehicle it claimed will come in “under $20,000” after factoring in federal EV tax credits.

Now, another start-up is looking to bring out what it is calling the New Yugo. We got a first hint of what was in store in February and now, the design penned by Serbian designer Marčeta has made its debut at Munich’s Car Design 2025.

It carries over some of the distinct design cues found in the original Fiat-based Yugo, such as the forward-leaning nose and decidedly boxy angles. The body is more slab-sided than most of today’s offerings and, as you might expect, the new model remains a two-door.

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What we know

What was revealed in Munich was only a one-fifth-sized model. The team behind the project, led by Serbian Professor Dr. Aleksandar Bjelić, told Britain’s Car Magazine that the concept vehicle “does not just serve as a historical reminiscence, but underscores the affordability and the sportiness of the new model.’

The New Yugo team is said to be working on several internal combustion powertrain options, including a possible performance model. And an all-electric version is also being kicked around.

The company says it is working up a full-size prototype, and that it hopes to be ready for production in two years. Specific details on where the manufacturing would take place – and who will fund the project – is yet to be announced. But they promise we’ll see more at the Belgrade Expo in 2027, with production aimed to begin that same year.

Whether the market is ready for the return of the Yugo is another matter. But considering the number of motorists today priced out of the new vehicle market – not only in the U.S. but around the world – perhaps Yugo’s past sins can be forgiven, if not forgotten.