Tatra's T97 model is possibly one of the most misunderstood of all their vehicles - and that's saying a lot considering how much misinformation there is about Tatra in general. The Tatra T97 was an attempt to bring the modern features of rear-engined streamlining to a wider market by slightly reducing the vehicle's size and using a smaller engine. It was in no way intended to be a 'people's car' or 'like a Volkswagen.' The similarities to the Volkswagen are superficial at best.
In 1936 Tatra was finally able to have full steel car bodies pressed which opened up a whole new world of development. Prior to this, all Tatra cars were coachbuilt (steel on wood framing). This was not a problem for the company's luxury products, such as the T77 and T80 limousines as customers expected high quality, custom construction, but it limited the company's ability to mass produce its budget car range. Pressed steel bodies commenced with the Tatra T57b, which helped make that model the most successful car in the Tatra range.
Steel pressing allowed the company to develop the significantly improved T87 streamliner, which addressed many of the problems of rear weight distribution in the earlier T77 and T77a models. A lighter weight but more powerful engine also helped. At the same time, the company decided to build a slightly smaller version, the T97. Some extraneous features of the T87 were dispensed with, such as the third headlight. Interior fittings were less luxurious. To save cost, the T97 reused the same rear engine bootlid.
A newly developed 1790cc four cylinder flat four engine was installed in the car. However, this did not make the T97 a budget car by any means. It was still a very expensive vehicle targeted at the upper middle-class.
At any rate, the T97 was not a major seller during its 2 years of production. Only some 500 bodies were pressed, and sales were slow. In 1938, when Bohemia and Moravia were 'absorbed' into 'Greater Germany', the Ringhoffer-Tatrawerkes were incorporated into the German nationalized automobile industry. Under the Schell Plan, so-called 'surplus' models and minor manufacturers were removed from the market. Tatra were permitted to continue production of the Tatra T87, the budget T57b and two models of heavy truck. All other model lines were shut down. For Tatra this included T80 front-engined V12 limousine, the company's most exclusive and luxurious model, the T97 streamliner, the T75 middle-class car as well as a number of light trucks. This decision had nothing at all to do with the Volkswagen.
Link to the complimentary Tatra T87 Czech brochure: https://tatrat600.blogspot.com/2022/07/1937-tatra-t87-czech-brochure.html
