Posted by: Ken-Arild Kristianse on Tuesday, April 09, 2002 - 09:46 PM CET
AUDI AG can look back on a multi-faceted history that has seen
considerable change; its tradition in the manufacturing of cars and
motorcycles stretches back to before the turn of the century. The
marques which were originally all based in Saxony - Audi and Horch in
Zwickau, Wanderer in Chemnitz-Siegmar and DKW in Zschopau - made a
significant contribution to the progress of the automotive industry in
Germany. These four marques merged in 1932 to form Auto Union AG. In
terms of the sheer number of vehicles built, this was the second-largest
motor vehicle company of its day. Four interlinked rings were adopted as
its marque emblem. After the Second World War, Auto Union AG's
production plant in Saxony was expropriated and dismantled by the
occupying Soviet forces. A
number of the company's senior managers departed for Bavaria, where a
new company under the name of Auto Union GmbH was founded in 1949 in
Ingolstadt, upholding the motor vehicle tradition under the sign of the
four rings. Auto Union GmbH and NSU merged in 1969 to form Audi NSU Auto Union AG; this the company was renamed AUDI AG in 1985 and its headquarters transferred to Ingolstadt. The four rings remains the company's emblem to this day. Horch  August
Horch, one of the pioneering figures of Germany's automotive industry,
was the figure behind this company. A graduate of the Technical College
in the town of Mittweida, Saxony, he originally worked in engine
construction at Carl Benz in Mannheim, gradually working his way up to
the position of head of motor vehicle construction. In 1899 he decided
to set up business on his own, and founded Horch & Cie. in Cologne. He
was the first in Germany to use cast aluminium for his cars' engines and
gearbox housings, a cardan shaft served as the power transmission
element, and the gearwheels were of high-strength steel. In 1902 he
moved to Reichenbach in Saxony, then on to Zwickau in 1904. Cars with
two-cylinder engines were built from 1903, with four-cylinder versions
being added after the start of the company's operations in Zwickau.
Their performance was so impressive that a Horch car triumphed in the
1906 Herkomer Run, the world's most arduous long-distance race. Two
years on, the company recorded annual sales of over 100 cars for the
first time.  After
a disagreement with the board of directors and the supervisory board, in
1909 August Horch quit the company he had founded, without delay setting
up another motor vehicle company in Zwickau. As his name was already in
use by the original company and had been registered as a trademark, he
arrived at the name of the new company by translating his name, which
means "hark!", "listen!", into Latin: Audi. August Horch moved to Berlin in the 1920s and was appointed a member of the supervisory board of Auto Union AG in 1932, continuing to be involved in the company's technical development work mainly in his capacity as expert. In 1944 he moved from Berlin to the Saale region. Horch spent his final years in Münchberg, Upper Franconia, where he died in 1951 at the age of 83.  August
Horch demonstrated hands-on involvement in the development of the motor
car from its very earliest days. His principal legacy is that his
technical innovations, coupled with his remarkable resolve, paved the
way for the transformation of the early motor vehicle into the car as we
know it. The company which still bore the name Horch originally adhered to a range of model types, the structure of which was still the one created by the company's founder. After the First World War, the aircraft engine company Argus-Werke, acquired a majority interest in Horch. Two of the most renowned engineers, Arnold Zoller and subsequently Paul Daimler, son of Gottlieb Daimler, were thus elevated to the rank of chief designers for Horch-Werke's operations in Zwickau. In autumn 1926, Horch-Werke unveiled a new model driven by an eight-cylinder inline engine created by Paul Daimler. This engine was notable for its reliability and refinement, and set the standard which all competitors sought to emulate. The Horch 8 became synonymous with elegance, luxury and superlative standards in automotive construction.  In
autumn 1931, Horch-Werke of Zwickau launched its newest top product at
the Paris Motor Show: a sports convertible with twelve-cylinder engine,
painted brilliant yellow, with a brown soft top and upholstered in green
leather. Between 1932 and 1934, only 80 of this exclusive Horch were
sold. The market for such luxury cars slumped. Horch was the clear
market leader in the entire deluxe class and it sold one-third more cars
than its competitors; for instance, Horch sold 773 cars in Germany in
1932 and was able to export around 300. However, this was not enough.
The company encountered financial difficulties, mainly due to the
financing of its sales operations. Audi  Following
August Horch's departure from Horch-Werke AG in 1909, he set up another
factory which was likewise to manufacture automobiles. As Horch was not
allowed to use his own name for this second company, he took the Latin
translation of his name, which means "hark!", "listen!", and gave his
new Zwickau-based company the name Audi. In 1910, the first new cars
with the brand name Audi appeared on the market. They earned particular
acclaim for an unparalleled string of victories between 1912 and 1914 in
the International Austrian Alpine Run, generally acknowledged to be the
most difficult long-distance race in the world. After the First World
War, Audi distinguished itself by becoming the first brand to position
the steering wheel of its production cars on the left and to move the
gear lever to the centre of the car. This resulted in much easier
operation.  1923
was the year in which Audi's first six-cylinder model made its
appearance. This car had an oil-wetted air cleaner, at that time
definitely the exception. It was years before the air cleaner became a
standard feature on all cars. This Audi also boasted one of the first
hydraulic four-wheel brake systems to be used in Germany, designed and
built by the company itself. In 1927, chief designer Heinrich Schuh
brought the first Audi eight-cylinder model, known as the "Imperator",
onto the market. Unfortunately, this imposing car made its appearance
too late: the deluxe car market was suffering a rapid decline in
fortunes. The company was purchased in 1928 by Jörgen Skafte Rasmussen,
the figure behind the mighty DKW empire. DKW  Jorgen
Skafte Rasmussen, a Dane by birth, established his first company in
Saxony after studying Engineering in Mittweida. In 1904 he set up an
apparatus engineering company in Chemnitz, three years later moving to
Zschopau, in the Erzgebirge region, where he began to experiment with
steam-driven motor vehicles in 1916. Although these experiments did not
lead to any specific product, they yielded the company name and
trademark DKW, derived from the German words for "steam-driven vehicle"
(Dampf Kraft Wagen). In 1919, Rasmussen obtained the design of a
two-stroke engine from Hugo Ruppe, a tiny version of which he sold as a
toy engine under the name of "Des Knaben Wunsch", meaning "The Boy's
Dream". This mini engine was subsequently upscaled and used as an
auxiliary cycle engine, evolving into a fully-fledged motorcycle engine
called "Das Kleine Wunder" (The Little Miracle" in 1922. Under the
watchful eye of J. S. Rasmussen (together with manager Carl Hahn and
chief designer Hermann Weber), DKW became the biggest motorcycle
manufacturer in the world in the 1920s. DKW also enjoyed a leading
international position as an engine manufacturer.  In
1927, Rasmussen had acquired design and production facilities for six-
and eight-cylinder engines from a Detroit automobile company which had
been wound up. Two new Audi models powered by these engines appeared on
the market. However, Rasmussen recognized the signs of the times and
stepped up his activities in small cars. The very first DKW cars
actually had rear-wheel drive and were built in Berlin-Spandau. At the
end of 1930, Rasmussen commissioned the Zwickau plant to develop a car
having the following design features: a two-cylinder, two-stroke
motorcycle engine with a swept volume of 600 cc, a unitary wooden
chassis with leatherette upholstery, swing axles at the front and rear,
and front-wheel drive. The car which Audi designers Walter Haustein and
Oskar Arlt came up with was given the name DKW Front. It was unveiled at
the 1931 Berlin Motor Show, where it caused something of a sensation.
The DKW Front was built at the Audi factory, and went on to become the
most-produced, most popular German small car of its day. Wanderer  The
name "Wanderer" dates back to 1896, when its fame was associated with
the bicycles built by Winklhofer & Jaenicke, a company founded in 1885
in Chemnitz. Production of motorcycles commenced in 1902, and the first
trial production of motor cars took place in 1904. A small car under the
name of "Puppchen" went into series production in 1913, and proved very
popular. No higher-performance successor appeared until 1926, when the
Wanderer Type W 10 with 1.5 litre engine and developing 30 hp made its
début. This car incorporated all the latest developments in the world of
automotive engineering, such as left-hand drive and a central gear
lever, a multiple dry-plate clutch, a unitary engine block and gearbox,
and a four-wheel brake system. This car met with an excellent market
reception.  To
cope with the overwhelming demand, a new production plant was built in
the Chemnitz suburb of Siegmar. Parts continued to be produced at the
existing factory, and were then transferred to the other plant by rail.
Individual parts and assemblies were unloaded directly from the rail
wagons onto the assembly line: just-in-time methods at the end of the
1920s! The buffer store in Siegmar had capacity for parts for only 25
cars – as many as could be built in a single day. Wanderer's marque image was characterized by its extremely reliable cars and by their outstanding manufactured quality. Such excellence had its price, however, and at the end of the 1920s Wanderer attempted to stem the looming crisis with more modern body designs and higher-performance engines. Despite these innovations, production figures slumped. Wanderer's car production operations fell into the red. The entire motorcycles division had already been sold off to NSU and the Czech company Janecek. This prompted Dresdner Bank, Wanderer's largest shareholder, to promote plans to sell off the automotive division and to expand the profitable machine tools and office machinery operations. Auto Union AG  In
common with the automotive industry as a whole, the 1920s were a period
of rationalization at Audi, Horch, DKW and Wanderer. Line assembly and
modern machine tools had resulted in a sharp rise in production
capacity, yet mass production could only work if there was corresponding
market demand. Promoting sales to the necessary degree was a costly
affair, and the price war triggered off by stronger competition from
abroad also devoured large amounts of money. The German car industry
found itself frequently unable to finance all this from its own profits,
and sources of credit were needed.  In
Saxony, the State Bank of Saxony had more or less satisfied
Horch-Werke's needs for capital loans, and had also paved the way for
the expansion of the Rasmussen Group. The State Bank of Saxony
eventually resolved to consolidate its interests in the automotive
trade, and the idea of Auto Union was born. The absorbing company was
Zschopauer Motorenwerke J. S. Rasmussen AG, which already owned Audi-Werke
AG. Horch-Werke AG was also placed under its control, as was Wanderer-Werke's
car division through a purchase and leasing agreement. Its share capital
totalled 14.5 million Reichsmarks, with the State Bank of Saxony
controlling an 80 % interest. The creation of a competitive structure The image of Auto Union AG on the motor vehicle market was shaped by the four founder marques Audi, DKW, Horch and Wanderer, together with their products. It took years to develop a consistent corporate concept and apply it to this chance constellation of highly traditional companies. Type development  At
the 1933 German Automobile Exhibition, in which Auto Union participated
for the first time in its new corporate form, the Audi marque caused a
stir with its front-wheel drive for midsize cars. However, the
innovative nature of this development was not reflected in higher
registration figures, with avant-garde technology evidently proving to
have only marginal market appeal. The concept was modified and in 1938
the Audi 920, a car which was externally very modern in design, with a
high-performance engine, was launched on the market. Its newly developed
OHC engine developed 75 hp, propelling the car to a top speed of 140
km/h. This Audi was aimed at customers who wanted a powerful car, but
not necessarily a large one; an Audi for dynamic, sports-minded drivers.
Front-wheel drive subsequently yielded to rear-wheel drive again, and
the conventional profile-type chassis was adopted instead of a central
box-type chassis. The car was available as a 6-window saloon and as a
two-door convertible with four windows. Demand for the Audi 920 was so
high that more than a year's production output was sold out only shortly
after its launch. At that time, the fame of the DKW marque was based primarily on its motorcycles. In 1933, the model range comprised eight different types with engines ranging from 175 to 600 cc. One year later, the RT 100 appeared on the market. With its simple, straightforward body and its combination of economy and power, it set standards that remained valid for several decades. The RT was available for an unbeatable 345 Reichsmarks, and became one of the most-produced motorcycles of all time.  The
200 Class nevertheless continued to underpin the success of the
motorcycle operations in Zschopau. DKW enjoyed a clear market lead here,
a fact unchanged by the appearance of the NZ series in 1938. These
attractive models in the middle and upper displacement class, with
four-speed gearbox, foot gearshift mechanism and rear suspension, were a
fitting reflection of the advanced development status of DKW two-stroke
motorcycles. DKW's small cars were produced both in Berlin-Spandau (rear-wheel drive and charge-pump V4 two-stroke engine) and in Zwickau (front-wheel drive, two-cylinder, two-stroke inline engine). All engines were built in Zschopau, whereas the DKW wooden chassis for the front-wheel-drive DKWs assembled in Zwickau were manufactured in Spandau. The German rail operator, the Reichsbahn, transported daily shipments of vehicle bodies to Zwickau for eight marks per body.  The
DKW front-wheel-drive cars (bearing the type designations F2, 4, 5, 7
and 8) were available in two classes: the "Reichsklasse" (600 cc engine,
18 hp) and the "Meisterklasse" (700 cc engine, 20 hp). "Front Luxus" was
the name of the beautiful convertible with a sheet steel body. The DKW
Front models remained the most popular and best-selling small cars in
Germany: in the 1930s, a quarter of a million of these cars were sold.
Their front-wheel drive gave them something of a pioneering character.
The F9 was the designated successor to the models built both in Spandau
and Zwickau, with its new three-cylinder engine developing 28 hp and
sheet steel body. It was scheduled to enter production in 1940, but then
the war intervened.  Horch's
reputation for exclusive cars built in Zwickau stretched back several
decades. The engines in particular served as a benchmark and were
considered exemplary for both their performance characteristics and
their refinement. Economy was not an issue in the deluxe class, and the
"Horch 8" came to be regarded as the zenith of quality. The V8 engine
developed by Fritz Fiedler was launched in 1933, initially as a 3.0
litre version; 3.5 litre and then 3.8 litre versions followed, and its
power output edged up from 70 to 92 hp. Compared with the eight-cylinder
inline engine developing a hefty 120 hp, it was nevertheless still the
"small" Horch. Both automobile types were initially rigid-axle models
whose driving properties became something of a problem at higher speeds.
 In
1935, Horch's cars were given independent front suspension and a De Dion
axle at the rear (double universal joints with a rigid axle and
frame-mounted differential). The Type 853 sports convertible with
eight-cylinder inline engine, considered by many to be the most
beautiful Horch ever built, made its début in the same year. The Horch
marque was easily able to assert its leading position in the deluxe
class; in 1937, it held a market share in excess of 50 percent in the 4
litre and upwards class. Wanderer's cars were already being propelled by the new overhead camshaft engine designed by Professor Porsche before the Auto Union era. New, modern suspension layouts and body versions were therefore developed on this basis. A rear swing axle in conjunction with a rigid front axle appeared in 1933 on the Type W 21 and 22, with independent front suspension finally being adopted for the W 40, 45 and 50 in 1935. Models with three-figure code numbers (W 240, 250, etc.) represented the transitional phase between the two.  The
dependable but very expensive OHV engine was replaced by a side-valve
engine of identical power output from 1937 on. The W 24 (four-cylinder)
and W 23 (six-cylinder) models first appeared on the market with these
engines in 1937. The engines were standardized and the chassis largely
coordinated (rigid rear axle and raised transverse springs). Auto
Union's new line of body versions first appeared on the 1936 Wanderer
model W 51. From then on this line, which was inspired by American
models, was echoed by all new Auto Union vehicles to a greater or lesser
degree. Centralization In the same way that Auto Union was originally simply a new name for long-established products, the management too initially adhered to existing structures. At first, the group was managed from Zschopau (DKW's home). In 1936 the group's new office building in Chemnitz was completed, following conversion work. This signalled the end of separate vehicle development activities at each location: the Central Design Office and Central Testing Department were opened in Chemnitz. New group vehicles were now developed and tested here, and the prototype and a set of drawings were then handed over to the production plant. Particular emphasis was placed on the development of two-stroke engines. Auto Union had acquired an exclusive licence from Klöckner-Humboldt-Deutz for the utilization of the Schnürle patents (the reverse scavenging principle in the two-stroke engine) for its small engines. The crucial advantage of this principle was that it significantly cut fuel consumption, while boosting power output. Optimized production Wanderer's engines were standardized, and the Horch V8 was destined to be replaced by a six-cylinder inline engine (offering higher output and greater refinement). Auto Union had made considerable progress in the development of automatic transmissions, and Auto Union's engineers were now seeking new methods of styling and materials selection for their body development work.  The
Central Body, Development and Design Office pursued the idea of
streamlining from the very outset, using the patents of the Swiss
aerodynamics expert Paul Jaray as its basis. The optimum aerodynamic
properties were first calculated by theoretical methods, then tested out
in the wind tunnel. Production-ready body versions of the DKW F9
achieved an astonishing frontal drag coefficient of cD = 0.42 (the
figure for the predecessor model, the F8, was 0.58)! Even decades later,
this was still par for the course for German production vehicles. Prompted by the shortage of iron and rubber due to the arms race, coupled with the fact that wooden chassis with leather upholstery were now too costly to build (in view of the intensive manual labour required), Auto Union began development work on a plastic body in conjunction with Dynamit AG in Troisdorf. An empirical crash testing programme was developed to assess the strength of wood, sheet metal and plastic – the first in the history of the German automobile industry. Sideswipes and lateral and offset frontal rollovers were simulated in the Central Test Laboratory in Chemnitz. Its technical division investigated all matters relating to the materials, developed alloys and special production methods, and investigated the technological suitability of all new designs. The scientific division concentrated on future engine versions, the development of transmissions, the investigation of vibration and noise, and preparations for complex tests such as the positioning of the catapults used in crash tests. The road testing division handled the practical testing programme, series testing and monitoring, and comparative testing of competitors' products.  Auto
Union enjoyed rapid expansion between 1933 and 1939: its consolidated
sales rose from 65 to 276 million Reichsmarks, and the workforce grew
from 8,000 to over 23,000. Annual production output of motorcycles
soared from 12,000 to 59,000, and car production climbed from over
17,000 units to more than 67,000 per year. Compared with the year of
Auto Union's founding, output of Horch cars had doubled by 1938,
production of Wanderer cars was more than five times as high, and the
total for DKW cars had actually risen to ten times the level at the time
of the merger. War and liquidation The outbreak of the Second World War brought to an end this development. Auto Union AG built its last civil vehicles in 1940. From then on, it was obliged to heed official instructions and focus its production operations on the war effort.  Auto
Union AG was in existence for 16 years. For its last three years it was
in effect merely awaiting liquidation, and for six years previous to
that, the war had caused its automotive operations to be paralysed. Auto
Union's wealth of innovation and meteoric growth all took place within
the space of its first seven years. The innovation and skill of its
automotive experts is reflected in over 3,000 patents granted both in
Germany and elsewhere. One in four passenger cars registered as new in
Germany in 1938 was built by Auto Union. More than one-third of all
newly registered motorcycles in Germany were DKWs. Auto Union AG was the
behind numerous technical developments, research findings and ideas that
played a pioneering role in the creation of the modern-day car. After the end of the war, Auto Union AG's production facilities were expropriated and dismantled by the occupying Soviet forces. In 1948 the company was deleted from the trade register of the city of Chemnitz. By this time, several of Auto Union AG's senior management had moved to Bavaria, where the company had found a new home in Ingolstadt. A new beginning in Ingolstadt  A
new company bearing the name Auto Union GmbH came into being on
September 3, 1949 in Ingolstadt, to uphold the automotive tradition of
the four rings. It is this company that is the actual precursor of the
present-day AUDI AG. From its base in West Germany, its purpose was now
to maintain the tradition that the former Auto Union AG had established
in Saxony. Life at the time of its re-establishment was frugal, so small, economical vehicles were called for. In the early years, the only vehicles built in Ingolstadt with the four-ring emblem were DKW motorcycles and cars, with their typical two-stroke engines. The formal re-establishment of the company in 1949 was actually already the second step towards a new beginning after the war. The first move after "zero hour" took place on December 19, 1945, when the "Zentraldepot für Auto Union Ersatzteile GmbH" was founded in Ingolstadt. This central depot had the task of supplying spare parts for all pre-war Auto Union vehicles that had survived the ravages of the past six years; there were all of 60,000 such vehicles in the western occupied zones. So why Ingolstadt?  One
argument in favour of Ingolstadt as the home of the central depot was
its good transport connections, located as it was at the heart of
Bavaria. Influential figures in the Ingolstadt city authorities
presented a good case in favour of the central depot, arguing that it
would aid the regional employment market. However, the key reason for
the re-establishment of the company in Ingolstadt was its centuries-old
military tradition as a garrison town: this legacy included expansive
outdoor areas and numerous barracks, outbuildings, casemates and the
like – invaluable assets at a time when there was precious little
capital for erecting new buildings. From its headquarters in the former army supplies office in Schrannenstrasse, the company was gradually able to take over a variety of other buildings such as the Friedenskaserne barracks, the New Arsenal, the NCOs' building, the vehicle halls, the ammunition store, the riding hall and the large parade ground. As its facilities were scattered all over the city, a rational production process was scarcely possible. The workers referred to it tongue-in-cheek as the "United Hut and Shed Company." The "Bavarian strike"  August
9, 1954 saw the outbreak of a strike in the Bavarian metalworking
industry which many inhabitants of Ingolstadt still vividly recall. This
was one of the first major industrial disputes in the young Federal
Republic of Germany, and companies in the metalworking sector even went
so far as to call it the "most stirring and significant event of the
post-war years." Auto Union, one of the largest employers in the city, with a workforce of around 5,000, likewise saw most of its workers lay down their tools. Their demands included a shorter working week, higher pay and better working and living conditions. The "Bavarian strike" lasted until August 31, 1954, when an agreement was finally reached through arbitration. An average pay increase of just over four percent was the outcome. The liaison with Daimler-Benz  The
"Bavarian strike" cost Auto Union around DM 920,000. 1954 was
nevertheless the first year in which the company recorded a notable
profit (around DM 400,000). In the same year Friedrich Flick, the
majority shareholder in the iron and steel works Eisenwerk-Gesellschaft
Maximilianshütte mbH Sulzbach-Rosenberg, popularly known as "Maxhütte",
acquired a financial interest in Auto Union GmbH. He realised some years
previously that the Ingolstadt car manufacturer would one day need a
partner with plenty of capital. In 1957, Flick advocated the takeover of Auto Union by Daimler-Benz. At that time, he owned 41 percent of Auto Union's shares, as well as a 25 percent stake in Daimler-Benz. He could also rely on the backing of the Swiss industrial magnate Ernst Göhner, who likewise held a 41 percent interest in Auto Union. Daimler-Benz AG accepted the offer. In view of growing pressure from foreign competition, it wanted to extend its production range in market segments lower down the range. Flick also dropped Daimler-Benz a large hint that he was in negotiation with Ford, too.  On
April 24, 1958 Daimler-Benz acquired around 88 percent of Auto Union's
shares for just over DM 41 million. One year later, in 1959, the
remaining shares were also sold to Daimler-Benz. Daimler's board of
management spokesman Fritz Könecke summed up the merger of Germany's
second-largest and fifth-largest car manufacturers as follows: "We have
married a nice girl from a good, old-established family!" On April 9.
1958 the business newspaper "Handelsblatt" wrote: "With the takeover of
Auto Union GmbH, which reports annual turnover of around DM 400 million
and employs a workforce of 10,000, the Daimler-Benz Group is now once
again the Federal Republic of Germany's largest car manufacturer in
terms of sales revenue, too." A new plant in Ingolstadt At the time of the Daimler-Benz takeover, the only Auto Union vehicles in production in Ingolstadt were motorcycles and the DKW rapid delivery van. Auto Union's car production operations were concentrated at the Düsseldorf plant that had gone into operation in 1950.  For
want of capital, the company had put back production of a modern,
low-priced small car that had been in development since the mid-1950s
and that was one day to be launched under the name "DKW Junior".
Although the takeover by Daimler-Benz guaranteed the necessary funding
of the long-overdue project, the company was short of the production
capacity needed. A new plant therefore had to be erected without delay – either in Ingolstadt, or in Zons, near Düsseldorf, where the company had already acquired an industrial site. Fritz Böhm, at that time Chairman of the Works Council and a member of the State Parliament, is said by former colleagues to have "fought like a lion" to have the new factory built in Ingolstadt. Thanks to his useful contacts with the world of politics, the Free State of Bavaria was always "one step ahead" of North Rhine-Westphalia. An investment loan of DM 25 million from the Bavarian State Bank played a major part in the company's ultimate choice of Ingolstadt.  Another
factor which argued in Ingolstadt's favour was the impending collapse in
business for two-wheelers: in view of plummeting demand for motorcycles,
there were plans to wind down DKW motorcycle production in the short
term. In contrast to the Zons location, there were considerable numbers
of qualified workers available in Ingolstadt – in the late 1950s, a
major consideration whenever a company was deciding where to locate. In
July 1958, construction work on the new plant in Ettinger Strasse
finally began. A sum of DM 76 million was invested here in 1959, and a
further DM 51 million in 1960. The regional newspaper, Donaukurier,
wrote euphorically: "One of the largest and most modern car plants in
Europe is currently being erected near Ingolstadt". The deal between VW and Daimler-Benz  At
the end of 1958, Auto Union had 3,700 employees in Ingolstadt; twelve
months later, the figure had soared to 5,700. The construction of the
new plant not only meant that the workforce had grown dramatically. It
was also the principal factor behind Auto Union's decision to transfer
its production to Ingolstadt in 1961, followed by its administrative
headquarters in 1962. The desired rationalization and cost-cutting
effects materialized, but from 1962 Auto Union's production and sales
figures both took a downturn, at a time when the parent company was
experiencing a boom in both production and sales. In 1964 in particular, Auto Union was confronted with acute financial difficulties. Daimler-Benz AG, increasingly going at arm's length to a subsidiary that was proving too difficult for comfort, for all its pedigree, decided that the best solution was what turned out to be a spectacular commercial transaction: the sale of Auto Union to Volkswagen. Issue 45 of the news magazine "Der Spiegel" wrote: "Daimler-Benz's prominent shareholder Friedrich Flick spent more than a year devising, rethinking and fine-honing the latest big scheme in his eventful career, "going on to comment that Flick had not only masterminded "the biggest business event of 1964," but had also been instrumental in laying down its finer details. Ownership of Auto Union GmbH was transferred to VW AG in several stages, from 1964 on. Its new owner spent a total of DM 297 million on the transaction, and by 1966 had all the company's shares in its possession. Good times, bad times...  The
takeover by VW meant that Auto Union escaped going into receivership by
a hair's breadth. The era of the two-stroke engine, formerly so popular,
was coming to an end, and almost 30,000 unsold DKW cars were destined
for the scrap heap. It was the VW Beetle which came to the rescue:
between May 1965 and July 1969, almost 348,000 of the VW Beetle were
assembled in Ingolstadt. From August 1965, the situation was also
alleviated by the launch of the new "Audi". This car, the first one with
a four-stroke engine to be built in Ingolstadt, aroused considerable
market interest and established the basis of a successful model range.
However, the recovery was only short-lived. After more than fifteen
years of seemingly unstoppable economic recovery, in 1966/67 Germany
suddenly went into a recession which hit Auto Union badly: production
had to be cut back dramatically, and short-time was the inevitable
consequence. On March 10, 1969 Auto Union GmbH signed a merger agreement with NSU Motorenwerke AG (Neckarsulm). The establishment of the new company with the name Audi NSU Auto Union AG was backdated to January 1, 1969. This company, whose headquarters were in Neckarsulm, adopted a course of growth and expansion from the outset. Production of Audi and NSU cars rose steadily until 1973, when initial signs of the oil crisis emerged. In 1974, the weakening of the international economy had such an adverse effect on the market that the company had to scale down production to 330,000 vehicles, from almost 400,000 in the previous year. Such a radical measure inevitably cost a considerable number of jobs: in 1974, the total workforce fell from 33,800 to 28,600; in 1975, 1,700 jobs were lost at the Ingolstadt plant alone.  Entering
a new dimension The car industry recovered at the end of 1975, a development that was reflected in the sales volume of Audi models. The last NSU Ro 80 left the assembly line in March 1977. This signalled the disappearance of the NSU brand, which dated back more than 100 years. Since that year, all cars built in Neckarsulm have borne the name "Audi". Audi caused a sensation in 1980 with the launch of the Audi quattro, the first volume production car with permanent four-wheel drive. Audi's rally sport activities served to underline the revolutionary nature and overwhelming superiority of its quattro concept: in 1982, Audi became the first German brand to win the intensely fought-over Manufacturers World Championship, a feat which it repeated in 1984.  In
1982 Audi establish a record of another kind: with its drag coefficient
of cD 0.30, the third-generation Audi 100 achieved the best aerodynamic
performance of any volume-produced saloon in the world. Audi had come up
with the right response to the challenges of the moment, at a time when
there were increasing calls for environmental protection and economical
use of fuel. On January 1, 1985 Audi NSU Auto Union AG was renamed simply AUDI AG. The company's registered headquarters were simultaneously transferred from Neckarsulm to Ingolstadt. In the mid-1980s, Audi – along with other German car manufacturers – began to feel the impact of a high-profile public debate on stiffer speed limits and reduced exhaust emissions. Whereas domestic sales fell by 7.5 percent in 1985, exports rose by 9.4 percent.  In
1985, AUDI AG's capital investments totalled almost DM 1 billion, the
highest figure in the history of the company. Product-related measures
and new production technology were the investment priority. In autumn
1986, the new Audi 80 with fully galvanized body was launched. It came
complete with a ten-year warranty against rust penetration, setting new
standards in this class. 1988 saw the appearance of the V8, Audi's first
deluxe-class car, with a 3.6 litre V8 engine and four-valve technology.
Audi's slogan "Vorsprung durch Technik" –meaning "Advancement through Technology", even though the German version may actually be more familiar in the English-speaking world – is also substantiated by the TDI engine concept.  Its
extremely low fuel consumption was documented impressively in several
economy test runs: in 1992, a standard Audi 80 TDI drove all round the
world, covering a distance of 40,273 km and clocking up an average
consumption figure of 3.78 litres of fuel per 100 km (74.7 mpg) and an
average speed of 85.8 km/h. In the early 1990s, the market worldwide was generally weak, but the fall of the Berlin Wall and German monetary union generated an immense surge in demand on the domestic market. This sales boost on its home market helped Audi achieve record-breaking sales revenues of DM 14.8 billion in 1991. However, by 1993 it was obvious that the special boom in Germany had only been able to allay the general downward trend for a couple of years.  Audi
heralded in a new era in presenting the ASF (Audi Space Frame) aluminium
study vehicle in autumn 1993 at the Tokyo Motor Show. The aluminium Audi
celebrated its world début in March 1994, as the successor to the Audi
V8. The new model designation A8 signalled a radical shift in Audi's
model-naming policy. The Audi A6 followed in the summer, with the new A4
being launched in November 1994. This latter model rapidly brought
further success to the company: in 1995, 120,000 of the Audi A4 were
sold in Germany alone.  In
autumn 1995, Audi produced its next trump in unveiling the sports car
studies TT Coupé and TT Roadster: these concepts successfully blended
distinctive automotive design based on nostalgic throwbacks with modern
stylistic features and mature technology. One year on, Audi launched the
A3, an attractive two-door compact model intended to draw new customer
groups to the brand. In 1997, Audi presented the new Audi A6 and also
the Al2 study vehicle, the latter an all-aluminium model based on
second-generation ASF technology. The Audi TT Coupé and Audi TT Roadster
production models were launched in 1998 and 1999. Since 1994, the company's key business figures have benefited from an uninterrupted upward trend. Audi has become an international developer and manufacturer of high-quality cars. The company maintains production sites in Germany, Hungary, Brazil, China and South Africa. Audi sold over 650,000 vehicles in 2000. Sales totalled around DM 39 billion (including the Italian sales subsidiary Autogerma). The Audi Group has around 50,000 employees. 
The last two pictures is a newly restored DKW Meisterklasse Universal type F 89 S from 1951. This exceptional vehicle represents a valuable addition to the collection of historic vehicles of Audi Tradition, representing as it does the resumption of passenger-car production under the sign of the Four Rings after the Second World War. If you want to see more Audi-pictures, visit kak.net! |
