BMW - History (12)
Let's talk about the new BMW 700. There is a newly appointed general manager Heinrich Richter-Brohm, whose aim was actually, to manufacture a mid-range automobile similar to the, much later developed BMW 1500. However, because the huge development expenses could apparently not be raised and the board of directors or the development engineers could not be brought into line, the plans were put on ice. There was still one more banker, Frowein, who could have persuaded the banks to grant the urgently needed joint credit, unfortunately he passed away suddenly and unexpectedly. The 600 was selling badly and in 1959, would have to be discontinued.
Richter-Brohm was friendly with Wolfgang Denzel, the technician, importer and racing driver from Vienna, and he held the first pieces of the puzzle which were necessary to start the rescue operation of BMW in his hands. At his own risk, he constructed, using the multiple parts from the BMW 600, a conventional car body in the 3-box-design. Indeed, for this reason, the engine was still placed, as before, at the rear, which, at the time, was very unusual for a completely new construction. Together with the Italian flair from Michelotti, a marketable car in the shape of a limousine and a coupé, was developed in a very short time.
The 700 was not even on the road yet when the final collapse threatened. The trick which prevented the collapse, was basically, said to be the work of two men. One was called Matern, who represented the BMW dealers as a lawyer. At the decisive shareholders meeting in December 1959, he succeeded in preventing the continuation of BMW (approx. 6.000 employees) as a Mercedes (approx. 60.000 employees) assembly plant. He publicly doubted the almost decided bancruptcy. He conjured up an offer for the factory in Allach, whereby MAN made an offer of DM 30 million and he pointed out that the balancing was wrong, wherein, e.g., the development costs of the just launched 700 would be written off in just one year. If this balance was ever presented at the meeting, and if it received a positive vote, the take-over by Stuttgart would have been cut and dried.
At this point, it may be convenient, to change the subject, because, with the defending of themselves against the overpowering competitor Mercedes, it was of course, not over. The factory still found itself in a threatening situation. At this time, the second of the two men arrived on the scene, his name was Herbert Quandt. His past, his father Günther, his brother Harald Quandt and the origin of his fortunes won't be discussed here. In connection with BMW he was, from then on, seen as an above average, dedicated shareholder, at first with his own shares of around 10% and all together, 25% voting rights. The continuation of the factory without a partner meant selling the factory in Allach at a good profit (in the end for DM 37,5 million) and to issue further shares to finance the development costs of a new, urgently needed, mid-range car. Quandt gave the guarantee, that he himself would buy any unsold share-packets, which proved however, not to be necessary, thanks to the trust shown by the investors, in BMW's good name.
Just like Franz Josef Popp before the war, it seemed that Herbert Quandt now held the fate of the company in his hands. He suggested Wilke as the new chairman of the supervisory board and was, at least involved, in taking over the chief constructor at Borgward Gieschen and also the sales boss Hahnemann from Auto Union. As a multimillionaire, he put in considerable (test) kilometers with the BMW 700, sometimes even as a front-seat passenger as his eyes were very weak. From the day of his recruitment onwards, the sales chief was placed in a key position. Indeed, he had a large amount of unsold 700s that had to be moved from the property, which he managed to do using a bit of “buddy-tactics” (blackmail is an ugly word). Whoever, in his role as a dealer, did not take (and sell) the old ones, would probably not have been supplied with the new top model. Once again, Hahnemann has the responsibility, because the new model had to be put on the market much too early, he had to pacify and reassure the customers with guarantees and goodwill to keep them in line. 01/11