Why did they name it after a beetle? They may not have known it was a beetle. They probably named it after the American version of 'Ferrari' of the late fifties.
A Californian rich guy, (who was also extremely bright) named Lance Reventlow (spelling?) created some incredibly potent sports racing cars in the late 50s and 60s... painted them blue and called them Scarabs. They kinda looked liked scarabs, scarabs seemed to be 'cool' at the time because of the popular interests in ancient Egypt at the time, and for some reason, the ancient Egyptians revered them.. an aristocratic insect. And Reventlow's cars were quick.
Now, an Arkansas rich guy named Walton owns most of them (or did a couple of years ago - I haven't kept up) and races them in historic events.
If my memory is working right, Lance Reventlow's racing programs ended after he tried to transfer his successful sports car technologies to formula 1 (his front engined cars couldn't compete with the new rear engine cars) and financial 'help' from the IRS. I think Lance was killed shortly thereafter in an airplane crash.