The Beginnings of BMW; 1890 to 1927

To trace the origins of BMW as an automobile manufacturing company, we have to go back to the turn of the century and follow the fortunes of two parallel German businesses; the Eisenach Vehicle Factory in Eisenach, and the “Bavarian Motor Works” in Munich. These two companies were destined to merge and produce some of the world's finest automobiles.

The Eisenach Vehicle Factory

In Düsseldorf in the mid-1890s lived a middle-aged engineer by the name of Heinrich Ehrhardt who had parlayed the proceeds from several mechanical patents into a modest fortune. One of these patents was the mechanical corkscrew shown here. Another one was a “pressing and extruding method for producing seamless hollow sections”, called the Ehrhardt Process, still used today for producing brass cartridge cases. Although disputed by some, it is also likely that he invented the recoiling-barrel gun, which is why he was sometimes called the “little cannon king”.

With a contract in hand from the German Office of Procurement for 1000 munitions wagons, he set out to build a factory in his impoverished home state of Thuringia where there was an ample supply of skilled workers and reliable access to raw materials. On December 3rd, 1896, with a capitalization of 1,250,000 Marks, the Fahrzeugfabrik Eisenach (Eisenach Vehicle Factory) was officially formed, literally in the shadow of old Wartburg Castle, in the eastern part of Germany. Ten months later the factory was finished.

Ehrhardt’s vision was to build gun carriages, military wagons, bicycles, and both electric and gasoline powered automobiles. By the end of 1897 the factory employed six hundred people, mostly skilled wood and iron workers. Arthur Rebling ran Eisenach’s motorcar engineering group. Development of gasoline and electric power ran in parallel; the general thinking was to let the results determine which power system was best. Rebling’s first design effort was finally built in both versions.

The military contracts were very profitable and the bicycle business was bringing in good money, especially the shaft drive “Mountain Bikes”. Automobile development, on the other hand, was expensive, and there was no immediate prospect of significant earnings. That was not unusual in those days. Before the turn of the century there was no clear-cut concept of how an automobile should look or work, and there was scant experience with the forces that would shape the market. To be sure, only a few farsighted individuals saw any future for automobiles at all.

On May 14th 1898, at an international rally for automobiles in Germany, there appeared the first "Eisenach" car, driven by a former bicycle racer named Fritz Kircheim. This was a prototype, running bicycle wheels and a 3 hp Benz motor. The race was 170 km (106 miles) from Aachen to Koblenz. The cars in the rally all showed the results of the 12 years of development since Gottlieb Daimler and Karl Benz built the first self-propelled "auto-mobile" in 1886. The upstart newcomer won the race handily with an average speed of 20 mph and a top speed of 25 mph. It had been raining and the road was deeply rutted from heavy freight wagons. The cars had no suspension systems.

About a month later, on July 14th, another Eisenach car, a three-wheeler with the same motor and better suspension, entered a road race from Mainz to Bingen to Koblenz and back. The competition ate Eisenach dust for the whole 118 miles! The winning time was 5 hours, 12 min. 3 sec!! Once again, the winning driver was Fritz Kircheim.

On Sept 23rd of that same year, two cars, a 5 hp and a 7 hp, were entered into the Munich to Bozen race...this race was stopped at Innsbruck, with the two Eisenach cars leading, because further south there was no gasoline available. (Don't forget, this was 1898 and gasoline was only available in drug stores and chemical supply houses!!)

As the year drew to a close, Heinrich grew impatient with the pace of development and decided to buy a license to produce the French Decauville, which he considered superior to anything he saw on Rebling’s drawing board. By the end of the year the first 3.5 hp “Wartburg built" Decauville was being tested on the race track. This was the production car that became the Wartburg, that became the Dixi, that became the BMW. Wartburg production started slowly. Only 85 of these air-cooled cars were built in 1899. For 1900, a water cooled 5 hp engine was introduced as well as an improved suspension. 165 more were produced with the 5 hp engine. Only six of these Wartburg Decauville cars are believed to exist today. One of these is in excellent running condition and is owned by Georg Schlautkotter in Munich. It can often be seen on display at the BMW Museum in Munich. Another one is in the Eisenach museum. The other four cars are non-runners on display in various museums around the world, including one in the Henry Ford Museum in Detroit.

The German economy was entering a recession about this time and even fewer cars were built over the next two years. A number of one-off cars followed, including an 80 hp race car with a top speed of 60 mph that won a class victory in the 1902 Paris to Vienna endurance run. About this time, Ehrhardt decided to bail, taking his Decauville license with him. (He and his son, Gustov, continued to produce the Ehrhardt Decauville for several years in nearby Zella St. Blasii.)

A well known German Engineer, Willie Seck, was brought in. His initial design effort, the S-6, was the first model to wear the “Dixi” name. Although only 18 cars were produced, it kept the company in the automobile business. According to legend, Willie coined the Dixi name, a Latin word that translates roughly to "I have spoken" or "The last word". 

Over the next 6-7 years, the recession deepened and there were rumblings of war. Production at the Eisenach factory was shifted to making trucks and other heavy equipment, including gun carriages, when the Great War started. The war economy was good for the company, but when the war ended, much of the factory was dismantled by the Allied Control Commission. It was 1920 before Dixi automobiles were produced again in any quantity.

The German automobile industry was slower in recovering from the war than the surrounding countries. Assembly-line manufacture, which had been taken for granted since 1909 in the United States, had not yet reached Germany where each automobile was put together while standing still, and painted by hand. It soon became obvious that the large handmade Dixi cars of the day were not a good fit for an economy rushing headlong into a depression. In 1927, the company signed a license agreement to produce the Austin Seven, a low cost automobile from England that could be produced on an assembly line.