Automotive industry in Germany
Automotive industry in Germany
The automotive industry in Germany is one of the largest employers in the country, with a labour force of over 747,000 (2009) working in the industry.
Being home to the modern car, the German automobile industry is regarded as the most competitive and innovative in the world, [1] and has the third highest car production in the world, [Two] and fourth highest total motor vehicle production. With an annual output close to six million and a 35.6% share of the European Union (2008),
German-designed cars won in the European Car of the Year, the International Car of the Year, the World Car of the Year annual awards the most times among all countries. The Volkswagen Beetle and Porsche nine hundred eleven took 4th and 5th places in the Car of the Century award.
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Germany was always inspired by the British automotive industry in the late 1860s and as motor-car pioneers Karl Benz and Nikolaus Otto developed four-stroke internal combustion engines in the late 1870s, with Benz fitting his design to a coach in 1887, which led to the modern day motor car. By 1901, Germany was producing about nine hundred cars a year. [Three] In 1926, Daimler-Benz was formed from the predecessor companies of Karl Benz and Gottlieb Daimler and produced cars under the marque of Mercedes-Benz. In one thousand nine hundred sixteen BMW was founded, but didn’t commence auto production until 1928.
American economist Robert A. Brady extensively documented the rationalization movement that shaped German industry in the 1920s, and albeit his general model of the movement applied to the automotive industry, the sector was in poor health in the later years of the Weimar Republic. Germany’s slow development of the industry left the market open for major American auto manufacturers such as General Motors who took over German company Opel in 1929, and the Ford Motor Company which maintained the successful German subsidiary Ford-Werke, beginning in 1925. [Four]
The collapse of the global economy during the Good Depression in the early 1930s plunged Germany’s auto industry into a severe crisis. While eighty-six auto companies had existed in Germany during the 1920s, scarcely twelve survived the depression, including Daimler-Benz, Opel and Ford’s factory in Cologne. In addition, four of the country’s major car manufacturers — Horch, Dampf Kraft Wagen (DKW), Wanderer and Audi — formed a joint venture known as the Auto Union in 1932, which was to play a leading role in Germany’s comeback from the depression. [Five]
The turnabout for the German motor industry came about in the mid 1930s following the election of the Nazi Party to power. The Nazis instituted a policy known as Motorisierung (de) (“motorization”), a transport policy which Adolf Hitler himself considered a key element of attempts to legitimise the Nazi government by raising the people’s standard of living. In addition to development and extensions of major highway schemes (which witnessed the completion of the very first Autobahn in 1935), the Volkswagen project was also conceived to design and construct a sturdy but inexpensive “people’s car”, the product of which was the Volkswagen Beetle, launched in 1937. A fresh city (known as Wolfsburg from 1945) was developed around the factory to house its giant workforce. [Four]
By the end of World War II, most of the auto factories had been demolished or badly bruised. Germany needed debt ease. The London Agreement on German Outer Debts of one thousand nine hundred fifty three provided that repayments were only due while West Germany ran a trade surplus, and that repayments were limited to 3% of export earnings. This gave Germany’s creditors a powerful incentive to import German goods, assisting reconstruction of the Car Industry. [6] In addition, the eastern part of Germany was under control of the Soviet Union, which dismantled much of the machinery that was left and sent it back to the Soviet Union as war reparations. Some manufacturers, such as Maybach and Adler (automobile), began up again, but did not proceed making passenger cars. The Volkswagen production facility in Wolfsburg continued making the Volkswagen Beetle (Type 1) in 1945, a car which it had intended to make prior to the war (under the name of KdF-Wagen), except that the factory was converted to military truck production during the war. By one thousand nine hundred fifty five VW had made one million Volkswagen Beetles, and by one thousand nine hundred sixty five had built ten million, as it gained popularity on export markets as well as on the home market. Other auto manufacturers rebuilt their plants and leisurely resumed production, with initial models mostly based on pre-war designs. Mercedes-Benz resumed production in one thousand nine hundred forty six with the pre-war–designed one hundred seventy series. In one thousand nine hundred fifty one they introduced the two hundred twenty series, which came with a more modern engine, and the three hundred series. Opel revived the pre-war cars Opel Olympia in one thousand nine hundred forty seven and the Opel Kapitän in 1948. (Toolings for the Opel Kadett were taken by the Soviets and used to make the Moskvitch 400-420., which had resumed production of trucks in 1945, began building the pre-war Ford Taunus in 1948. Porsche began production of their Porsche three hundred fifty six sports car in 1948, and substituted it with their long-lived Porsche nine hundred eleven in one thousand nine hundred sixty four (which remains in production more than fifty years and several incarnations later).
Borgward began production in 1949, and Goliath, Lloyd, Gutbrod, and Auto Union (DKW) began in 1950. BMW’s very first cars after the war were the luxurious BMW five hundred one and BMW five hundred two in 1952. In one thousand nine hundred fifty seven NSU Motorenwerke re-entered the car market. [7] [8]
Automobile manufacturers in East Germany after the war included Eisenacher Motorenwerk (EMW), which also made the Wartburg (car), and VEB Sachsenring Automobilwerke Zwickau, which made the IFA F8 (derived from the DKW F8) and the Trabant. East Germany’s status as a communist country was reflecting in the relatively primitive design and refinement of these cars, albeit they both continued in production until the early 1990s, shortly after the fall of the communist rule and the German reunification.
Initial production by EMW after the war were models that were essentially pre-war BMW three hundred twenty six and BMW three hundred twenty seven models, as the plant in Eisenach was formerly wielded by BMW.
During the mid-to-late 1950s the Bubble car became popular. BMW was the largest maker, with the BMW Isetta and BMW 600. Other makes included the Messerschmitt KR175 and KR200, the Heinkel Kabine, and the Zündapp Janus. Microcars such as the Glas Goggomobile, BMW 700, and Lloyd six hundred also were popular. However, the “Bubble car” concept had been abandoned by 1970.
In the late-1950s, BMW developed financial difficulties and control of the company was acquired by the Quandt family. BMW acquired Glas in 1966. In 1961, the Borgward auto group, including Goliath and Lloyd went out of business. In one thousand nine hundred fifty eight Auto Union was acquired by Daimler AG, but then in turn it was sold in stages from one thousand nine hundred sixty four to one thousand nine hundred sixty six to Volkswagen AG (at which time the DKW marque was ended and the Audi name was resurrected). In 1969, Volkswagen AG acquired NSU Motorenwerke (developer of the Wankel engine) and merged it with Auto Union, but the NSU nameplate disappeared by one thousand nine hundred seventy seven when production of the Ro80 rotary-engine saloon (European Car of the Year on its launch ten years earlier) was stopped largely due to disappointing sales and a poor reputation for reliability.
Ford merged its German and British operations in 1967, with the intention of producing identical cars at its German and British factories. Ford had also opened a factory at Genk, Belgium, in 1963. In 1976, it also opened a factory in Valencia, Spain, where production of the fresh Fiesta supermini (the very first Ford of this size to be built in any country) was concentrated. The Escort, launched in 1967, was the very first fresh Ford to be produced at both the German and British factories. At the beginning of 1969, Ford launched a fresh sporting coupe, the Capri, which like the Escort was produced via Europe. The Taunus of one thousand nine hundred seventy made use of the same basic design as the British Cortina MK3, but had slightly different exterior styling, albeit those styling differences were ironed out with the launch of the one thousand nine hundred seventy six Taunus. Ford’s fresh flagship model, the Granada, was built in Britain, Germany and Spain from the beginning of 1972, albeit British production was withdrawn after a few years.
Volkswagen was faced by major financial difficulties in the early 1970s; with its ageing Beetle still selling strongly all over the world but its newer models had been less successful. However, the company then liked a revival with the arrival of the popular Passat in 1973, Golf in one thousand nine hundred seventy four and Polo in one thousand nine hundred seventy five – all of these cars featured the fresh front-wheel drive hatchback layout which was loving a rise in popularity across Europe after very first being patented by Renault of France with the R16 in 1965. The Polo was Volkswagen’s fresh entry-level model, and was aimed directly at modern puny hatchbacks like the Fiat one hundred twenty seven and Renault Five. The mid-range Golf was seen as the car to eventually substitute the Beetle, and was lightly the very first popular hatchback of this size in Europe, leading to most leading carmakers having a similar-sized hatchback by the early 1980s. Production of the Beetle finished in Germany in 1978, albeit it continued to be produced in Mexico and Brazil until 2003, with a puny number of models being imported to Germany and the rest of Europe during its final twenty five years. The Passat was marketed as a more advanced alternative to traditional larger saloon cars like the Ford Taunus/Cortina, Opel Ascona (sold in Britain from one thousand nine hundred seventy five as the Vauxhall Cavalier) and the Renault 12.
The Scirocco coupe of one thousand nine hundred seventy four was also a success in the smaller sports car market, rivaling against the likes of the Ford Capri and Opel Manta. Its playmate company Audi also liked an upturn thanks to the success of its one hundred range (launched in 1968) and the smaller eighty (launched in one thousand nine hundred seventy two and voted European Car of the Year). Both of the fresh Audi models featured front-wheel drive. The Volkswagen Polo was in fact a rebadged version of the Audi 50, but the Audi original was a slower seller than the Volkswagen that it spawned and was only available in certain markets.
Volkswagen and Audi both loved a growing rise in popularity in overseas markets during the 1970s and this continued via the 1980s. Audi launched a well-received large saloon model, the Audi 100, in 1968, and followed this four years later with the smaller Audi 80, winner of the European Car of the Year award for 1973. In 1980, Audi moved into the sports car market with its front-wheel drive Coupe and the four-wheel drive, high-performance version, the Quattro. The Quattro four-wheel drive system was later adopted on Audi’s saloon models.
During the 1970s and early 1980s, General Motors integrated Opel with the British Vauxhall brand so that designs were collective with the only difference being the names. Faced with fierce competition from up-to-date designs from Volkswagen, General Motors moved to a front-wheel drive hatchback in one thousand nine hundred seventy nine with the latest version of the Opel Kadett, followed in one thousand nine hundred eighty one by fresh Ascona (which retained the Vauxhall Cavalier name for the British market). In one thousand nine hundred eighty two it opened a fresh plant Zaragoza, Spain, to produce the fresh Opel Corsa supermini; this car was later imported to Britain as the Vauxhall Nova. Production of the Kadett/Astra and Ascona/Cavalier models was divided inbetween factories in Germany, Belgium, Spain and Britain. The Vauxhall Carlton was shortly built in Britain from its one thousand nine hundred seventy eight launch, but within a few years production was fully concentrated in Germany, where it was built alongside the identical Opel Rekord.
The final version of the Opel Kadett was voted European Car of the Year on its launch in 1984, as was the Opel Rekord’s successor – the Omega – two years afterwards. The Ascona’s successor, the Vectra (still the Vauxhall Cavalier in Britain), was launched in 1988, but missed out of the European Car of the Year accolade to the Fiat Tipo.
BMW and Mercedes-Benz remained committed to rear-wheel drive on its saloons and booted coupes during these years. BMW, however, developed its model ranges more comprehensively in the 1980s and early 1990s. The original BMW three Series, launched in 1975, was sold as a two-door saloon or cabriolet. The 2nd generation model launched in 1982, however, was eventually available also as a four-door saloon and five-door estate, and during the 1990s the third generation model range eventually included a three-door hatchback as well. The BMW five Series, the mid-range model launched in 1972, was only sold as a four-door saloon for its very first two generations, but a third generation model was available as an estate from 1991.
With the radical switches in car design that took place across the 1970s and into the 1980s, Ford responded by substantially altering its model line-up. After launching the Fiesta supermini in 1976, it switched to front-wheel drive and a hatchback on the MK3 Escort on its launch in 1980, and opted to substitute the Taunus/Cortina with the Sierra in one thousand nine hundred eighty two – abandoning the hugely popular saloon format for an aerodynamic hatchback, albeit a saloon version was added in 1987. In 1983, Ford had also responded to the continuing request for family saloons by launching the Orion, the saloon version of the Escort. The Scorpio substituted the Granada as Ford’s European flagship in 1985, and was solely produced at the Cologne plant in Germany. The Scorpio was originally available only as a hatchback, and despite its popularity, Ford eventually expanded the Scorpio range by launching a saloon model in one thousand nine hundred ninety and an estate model in 1992. The declining request for sporting coupes led to Ford’s decision not to directly substitute the Capri, which was discontinued after 1986.
After its rejuvenation during the 1970s, VW modernised its model ranges during the very first half of the 1980s and continued to love strong sales in Germany and most other European markets. The Polo, Passat and Scirocco all entered their 2nd generation during 1981, and the MK2 Golf was launched in 1983. A saloon version of the MK1 Golf, the Jetta, had been available since 1979, and the MK2 Jetta was launched in 1984. One thousand nine hundred eighty eight eyed the launch of the MK3 Passat and a fresh coupe, the Corrado, which was produced alongside the Scirocco until the older car’s demise in 1992.
The VW Polo was updated in 1990, an all-new model eventually arriving in 1994, and the MK3 Golf was voted European Car of the Year shortly after its launch in 1991. The saloon version of the MK3 Golf, the Vento, was launched in 1992. The Passat was updated in one thousand nine hundred ninety three before an all-new model was launched in 1996. The Corrado was discontinued in one thousand nine hundred ninety six without an instantaneous replacement. VW moved into the MPV market with the Sharan in 1995, built in Portugal as part of a venture with Ford, which produced the identical Galaxy. A fresh Beetle, with front-wheel drive and a front-mounted engine, was launched in 1998, but like the later versions of the original model it was produced in Mexico rather than Germany. The MK4 Golf was launched in late 1997, and joined a year later by a saloon version, the Bora.
The West of Germany was far more technically advanced in comparison with the East (more than Four.Five millions against two hundred thousands annual production of auto vehicles in the 1980s), with the divide ending with German reunification in 1990.
During the 1980s and 1990s, the German auto industry engaged in major acquisitions and international expansion all over the World. Besides of direct export, German manufacturers found or bought plants in European, Asian, Latin American countries and in the United States even. Auto industry of Mexico, Brazil, China, Turkey, some post-socialist East European countries gained by German investments in a significant share.
Volkswagen set up a joint venture with Shanghai Automotive Industry Corporation in one thousand nine hundred eighty four (named Shanghai Volkswagen Automotive), and in one thousand nine hundred ninety established FAW-Volkswagen to produce VWs and Audis in China. VW also acquired SEAT of Spain in one thousand nine hundred eighty six and Škoda of Czechoslovakia in 1991, improving the model ranges of these manufacturers and helping increase their market share significantly across Europe. Volkswagen had even shifted Polo production to a SEAT factory in Spain after its acquisition of SEAT, and the one thousand nine hundred ninety three SEAT Ibiza formed the basis for the following year’s fresh Polo.
VW also made use of its components across the different marques; for example, by the year 2000, the floorpan of the Volkswagen Golf for example had spawned the Audi A3, Audi TT, SEAT Toledo, Seat Leon, Skoda Octavia and Volkswagen Bora.
By the end of the 1990s, VW moved into the luxury and supercar end of the market and acquired Bentley of Britain and the Bugatti and Lamborghini marques from Italy.
Ford had concentrated Sierra production in Belgium rather than Germany and Britain from the end of the 1980s, and its successor – the Mondeo – was solely produced in Belgium when it went into production around the end of 1992. The Escort remained in production across Europe until 2000, albeit its successor, the Concentrate, launched in 1998, was only produced in Germany for European buyers. The Scorpio was discontinued in one thousand nine hundred ninety eight and not directly substituted, with Ford instead directing potential Scorpio buyers to high-specification versions of the smaller Mondeo. The Scorpio’s demise occurred around the same time that Ford took over Volvo, which already had a strong presence in the executive car market, while Ford had taken over British luxury carmaker Jaguar in one thousand nine hundred eighty nine and was about to launch the Jaguar S-Type.
At the beginning of 1990s, Ford and Volkswagen agreed a venture to produce an MPV together at the same factory with the same basic design. The result of this venture was the Ford Galaxy and Volkswagen Sharan, but these vehicles were produced in Portugal rather than Germany from their launch in 1995. They were joined a year later by the SEAT Alhambra.
BMW acquired the British Rover Group in 1994, but large losses led to its sale in 2000. However, BMW retained the Mini (marque) name for a line of fresh cars, all built in Britain from 2001. During the 1990s, BMW opened a production facility for SUVs in Spartanburg County, South Carolina. BMW also acquired the Rolls-Royce Motor Cars name, effective as of 2003, and in the same year established a joint venture in China named BMW Brilliance. Daimler-Benz entered into what was primarily called a “merger of equals” with Chrysler Corporation in 1998. However, cultural differences and operating losses led to its dissolution in 2007, albeit Daimler-Benz kept Chrysler’s Chinese joint venture, renamed Beijing Benz. The company also launched the Wise in one thousand nine hundred ninety eight and relaunched the Maybach brand in 2002. In addition, during the 1990s they opened a production facility for SUVs in Tuscaloosa County, Alabama. [9] [Ten] [11]
On five July 2012, Volkswagen AG announced a deal with Porsche resulting in VW’s total ownership of Porsche on one August 2012. The deal was classified as a restructuring rather than a takeover due to the transfer of a single share as part of the deal. Volkswagen AG paid Porsche shareholders $Five.61 billion for the remaining 50.1% it did not own. [12] [13]
Presently, five German companies and seven marques predominate the automotive industry in the country: Volkswagen AG (and subsidiaries Audi and Porsche), BMW AG, Daimler AG, Adam Opel AG and Ford-Werke GmbH. Almost six million vehicles are produced in Germany each year, and approximately Five.Five million are produced overseas by German brands. [14] Alongside the United States, China and Japan, Germany is one of the top four automobile manufacturers in the world. [15] The Volkswagen Group is one of the three fattest automotive companies of the world (along with Toyota and General Motors).
The Chevrolet Volt and its GM Voltec powertrain Technology were invented and developed very first and foremost by the former German Opel engineer Frank Weber and—still today—some of the most significant parts of the development of GM’s electrified vehicles is done in Germany. [16]