Designers behind the modernized prototype, "Trabant nT" hope to transform the former smoke-belching clunker into an energy efficient vehicle for the modern city-dweller, equipped with electric fuel cells and a solar-panel roof.
"We think it will appeal to drivers who want something sustainable and stylish," said Daniel Stiegler, a spokesman for Herpa Miniaturemodelle.
The Trabant, known affectionately as the "Trabi," was designed as the communist answer to the Volkswagen Beetle and clattered down East German streets at a top speed of 100 kph (62 mph), trailing a distinctive odor of oil and mixed petrol.
Known in the West as a spark plug with a roof, because of its small size, East Germans queued for years to buy one.
Herpa, a Bavarian manufacturer of miniature vehicles bought the rights to the name two years ago with a view to creating, with a partner, a full-size revamped version of the cult car.
The firm said it received an overwhelmingly positive response in 2007 to a 1:10 scale model of its two-door, four seater concept.
"We had a folder at the fair asking visitors if they were in favor of the model as a real car," Stiegler said. "We had about 14,000 reactions and about 90 percent were in favor of bringing it back."
By the beginning of 2008, they had teamed up with specialist carmaker IndiKar, based near Zwickau where 2.2 million of the original Trabant 601 models were churned out between 1964 and the mid-1980s.
Managing director of IndiKar, Ronald Gerschewski told German media it was possible that the new Trabant could hit the roads by 2012 but that the companies still need investors to go ahead with the concept.
Websites list over 130 fan clubs for the boxy vehicle around Germany and others throughout Europe and the United States. Trabi enthusiasts welcomed the news but were skeptical about the vehicle's success.
"It's a super idea, but I'm not sure who will buy one," said Daniel Pohl of Trabant fan club "Trabant und Ostfahrzeugfreunde" in the eastern state of Brandenburg.
"The Trabant is a cult, partly because they're no longer produced. An electric model won't match up to the feel of an original."