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Germany's BMW Celebrates 80 Years

BMW marking 80 years as an automaker, an anniversary that might never have come about were it not for the tiny BMW-Dixi car that was born in Britain.

FRANKFURT (CP) -- BMW is marking 80 years as an automaker, an anniversary that might never have come about were it not for a tiny, spindle-wheeled car that was born in Britain.

The BMW-Dixi, which went on sale in German dealerships in July 1929, was the first model to bear the Bavarian Motorworks badge.

It was primitive but rugged and, most important in Germany's fragile economy, it was relatively cheap. The roughly 12,000 Dixis sold helped BMW ride out the initial years of the Depression.

BMW, which sold 1.4 million cars in a down market last year, has been marking the anniversary in Germany by showcasing some of its classic models at vintage car rallies and other automobile events.

Most of the attention has focused on cars like the BMW 328, a legendary 1930s sports car, and the 507, which debuted in 1955 and helped mark the company's rise from the ashes of the Second World War.

But the Dixi is where it began, Manfred Grunert, a spokesman for BMW Classic, says from the company's Munich headquarters.

BMW started as an aircraft engine producer, powering some of Germany's feared fighter planes in the First World War.

Defeat and the restrictions the Versailles Treaty placed on Germany's war-making potential left BMW scrambling for ways to survive.

It produced aircraft engines for civil aviation but branched out into making railway brakes and launched a successful motorcycle business that flourishes to this day.

BMW's board saw auto making as another way to diversify and stabilize its revenues.

In the late 1920s, Germany was still politically and economically unstable but clawing its way slowly out of the shambles of defeat.

Its auto industry was looking for ways to counter the onslaught of American mass producers Ford and General Motors. Consolidation seemed the best option, especially after GM acquired control of Adam Opel AG, one of Germany's biggest carmakers.

"The decision of Opel to join with General Motors, that was a kind of shock in the German car industry, especially concerning the reaction of the government," says Grunert.

(Bankrupt GM now is divesting itself of Opel.)

BMW saw an opportunity and bought up the ailing Eisenach Motor Works in eastern Germany.

Eisenach had a licence to produce a German version of Britain's Austin Seven, a basic affordable car inspired by Ford's Model T and sold under the brand name Dixi.

BMW acquired Eisenach in late 1928 and continued production of the Dixi DA-1 3/15. The first number was the car's road-tax category, the second the horsepower rating of its tiny four-cylinder engine.

By March of 1929, BMW had developed a tweaked version of the Dixi with a wider, all-steel body, roll-up windows and improved brakes.

The new car was dubbed the DA-2 but was still popularly called the Dixi. It was the first car to bear BMW's blue-and-white logo, which symbolizes a spinning propeller to acknowledge the company's aeronautical origins.

With an asking price of about US$600, the car was aimed at Germany's middle-class, which had been hard pressed by the economic turmoil and hyper-inflation of the early 1920s.

"It was not really a good idea to sell cars to the workers," says Grunert. "There wasn't enough money in these days."

Professionals, civil servants, farmers and, crucially, women, were targeted in BMW's advertising.

The improved Dixi quickly scored a public-relations coup by winning the gruelling, five-day Alpine Rally.

"The best average speed of 42 kilometres per hour was maintained plus 'reserves of speed' which were definitely there," said one news account of the event reproduced in a history of the company by Horst Monnich.

It wasn't quite the Ultimate Driving Machine yet but Grunert said it sowed the seeds of BMW's reputation for performance.

BMW had an alliance with Mercedes producer DaimlerBenz, which supplied DA-2 components, that was structured towards an eventual merger. The two companies' products didn't compete -- and wouldn't until the 1970s -- and they were sold at common dealerships. But BMW's leadership balked at a full merger.

"The board of management was very keen on staying independent because everybody was afraid that you have to take decisions you really don't like," said Grunert.

Cars were also seen as only one component of the BMW, a small, relatively low-risk venture.

"Nobody had a guarantee that it really works," said Grunert.

The DA-2 and successor DA-3 were produced until 1932, when the licence to build Austins expired.

By then BMW had begun to put its own design stamp on its cars. The first all-BMW design, with the signature twin-kidney radiator grill, was the 303, which debuted in 1933.

"You will recognize the car without the brand on it as a BMW also today," said Grunert.

The 1930s were a golden era for BMW cars but the parent company by then had slipped willingly, if not enthusiastically, into the Nazi military-industrial complex.

BMW had to rebuild again after 1945.

The Eisenach plant, located in the Soviet-controlled eastern zone, was nationalized by the Communist government and turned out rebadged pre-war models for East Bloc countries, then later an economy car called Wartburg.

The name came from nearby Wartburg castle but was also used on a limited-production two-seat sports car based on the BMW-Dixi.

BMW itself fell back on motorcycle production before producing its first new car, the 501, in 1951. But its bread and butter for much of the 1950s was the BMW-Isetta, a tiny bubble car that used a 12-hp single-cylinder engine.

Taking its early British connection full circle, BMW now owns Rolls-Royce -- which uses BMW's V-12 engines -- and it successfully revived that other British motoring icon, the Mini.