Who Owns Audi? – History and Relocation

Who Owns Audi?

Audi AG is an automobile manufacturer with its headquarters in Ingolstadt, Bavaria, Germany, and deals in the designing, engineering, manufacturing, and marketing luxury vehicles. Audi has nine locations where its luxury vehicles are produced and are owned by the Volkswagen Group. In this article, we will discuss who owns Audi over here.

Who Owns Audi?

Founded as August Horch Automobilwerke GmbH in 1909, the name changed due to copyright infringement. Horch chanced upon the name ‘Audi’ when a friend’s son suggested the Latin version of Horch’s name as the new company name. The name, however, was lost when Auto Union was formed in 1932 after the merging of four companies, of which Audi was one. Even though the four-ring logo was born out of this four-way merger, Audi’s name remained in the shadows for almost 25 years. Under Volkswagen’s ownership, Audi rose from the ashes of Auto Union, which by then had been divided between Daimler-Benz and Volkswagen. Volkswagen relaunched the Audi brand in 1965 with the Audi F103 series. Audi was then merged with NSU Motorenwerke in 1969. The merged company initially included the names Audi, NSU, and Auto Union, but with the success of Audi, the company was renamed Audi AG. 

Early History and Name

The history of how Audi came to involve the founding of two companies and the reason behind the logo of the company involves the merger of four companies. Audi’s existence is owed to August Horch, who founded A. Horch & Cie in November 1899 in Cologne, Germany. Five years later, Horch went ahead and founded the August Horch & Cie. Motorwagenwerke AG in May 1904. However, Horch faced some issues with the chief financial officer of the company and left the organization. He promptly founded another company in Zwickau called the August Horch Automobilwerke GmbH in July 1909. Due to the inclusion of his name in the company’s name, he was sued for copyright infringement. The German Supreme Court ruled that the Horch brand indeed was the legal property of A. Horch & Cie.

The company’s name now had to be changed, and since using his own surname was prohibited, Horch called a business meeting with his friends Paul and Franz Fikentscher. The meeting was held at Frank Fikentscher’s apartment, and it was his son suggested the name, Audi. His son was studying Latin at the time and, after much hesitation, came to suggest that since Horch means ‘hear’ in German, a possible name could be ‘Audi’ which comes from the Latin verb ‘audire,’ essentially meaning the same as Horch’s name. This suggestion was readily accepted by everyone. Thus, the new company became Audi Automobilwerke GmbH Zwickau and was registered at Zwickau registration court in April 1910. Five years later, its name was slightly modified to Audiwerke AG Zwickau. In 1920, Horch left Audiwerke AG Zwickau for a position in the German ministry of transport. However, it was a partial withdrawal as he was still a member of the company’s board of trustees

Logo and Auto Union

The logo of Audi has its own relevance. Before getting to be known as Audi, the company was called Auto Union as it was formed by merging four companies. The logo of the company has four intersecting circles signifying the merging of these four companies. The beginning of this merger came to be in 1928 when the majority of the shares of Audiwerke AG were acquired by Jørgen Rasmussen, owner of Dampf-Kraft-Wagen (DKW). This year and Rasmussen’s purchase of what remained of the U.S. automobile manufacturing company Rickenbacker became significant because they led to the formation of the Audi as we know it today. Rickenbacker was the provider of the manufacturing equipment of 8-cylinder engines. These engines were used in Audi Dresden, and Audi Zwickau models launched the following year. 

The formal merger of the four companies, namely Audiwerke AG, Horch, Wanderer, and DKW, was finalized in 1932. Thus, Auto Union AG was formed. While the logo has been in use since before the second world war, it was only restricted to being the logo on Audi Union racing cars. Other models were still running with separate company names. The second world war brought chaos, and the factories owned by the manufacturing company were ordered to be dismantled. As per the orders of the Soviet Union military administration, Auto Union’s assets were seized as war reparations, and no compensation was offered. The company Auto Union AG was then officially deleted from the commercial register in August 1948. Whatever remained of it, the manufacturing plant became VEB Automobilwerk Zwickau (people-owned automobile enterprise) or AWZ (Automobile Works Zwickau). Auto Union AG was thus liquidated. 

Relocation and Reformation

After understanding the changes in the country, the executives went on to search for a location where they could begin production again. East Germany was under Soviet control, so Ingolstadt, Bavaria, was chosen as it was located in West Germany. Initially, it began as the manufacturing project for spare parts in 1946, and by 1949, Ingolstadt had become the official headquarters of the Auto Union and remains so for Audi even today. The new Auto Union in West Germany was launched with Marshall Plan aid and some loans from the Bavarian state government.

The Ingolstadt Auto Union officially launched in September 1949. The initial production was a continuation of the DKW front-wheel drive vehicles that came with two-stroke engines. The new site where the company was set up was large enough to house both administrative operations and warehousing and distribution. However, while warehousing and distribution were possible, the site to manufacture automobiles on a commercial level was yet to be created.

After the second world war, the first passenger car of Auto Union was manufactured in a rented plant from Rheinmetall-Borsig. Even though manufacturing resumed and automobiles were being launched, it took ten years for the company to begin constructing a car plant at their Ingolstadt location, only after garnering enough funds. The shareholders in the company underwent a change when 87% holding was taken over by Daimler-Benz in 1958. This is supposed to be due to pressure from Friedrich Flick. By the following year, this was changed into a 100% holding. The major changes that came with Daimler-Benz were setting up the minute factory of Auto Union and investment in the new Mercedes models that were launched. Auto Union competed with rival manufacturers like Opel and Volkswagen and found itself lacking with its comparatively older model range.

As a result, the auto Union barely benefitted from the 1960s’ economic boom, and soon the decision to sell the company was on the table. Even though the business was sold due to its low profits, the new manufacturing plant was ready by the time of its sale, and plans were underway to launch a four-stroke engine. These could have very well spelled success for the company’s previous owners. However, the production was not happening under the name of DKW or Auto Union, but Audi was being used after being discontinued for over 25 years. 

Volkswagen Takes Charge

Ownership underwent a major change when Volkswagen bought 50% of Auto Union’s holdings. This 50% share included the ownership of the Audi and DKW brands, the new engine design yet to be launched along the new manufacturing plant in Ingolstadt. On the other hand, Daimler-Benz retained the brand Horch and owned the Düsseldorf factory, which was later used as an assembly plant for Mercedes-Benz vans. Volkswagen completely acquired the Ingolstadt factory more than a year later, and about 60,000 Volkswagen Beetles were annually assembled at the factory by 1966.

By the end of the decade, Auto Union merged with NSU. NSU had been the world’s leading manufacturer in the previous decade and had moved on to produce a range of small cars and rotary engines. Even though their new launch, NSU Ro 80, harnessed the power of aerodynamics and promised safety, the company’s problem with their rotary engines led the company to be acquired by Volkswagen. NSU’s Neckarsulm plant is now used to manufacture Audi’s “Quattro GmbH” (renamed “Audi Sport GmbH” in 2018) as well as the Audi models A6 and A8. In addition, it is a subsidiary for the development and mass-production of Audi models currently. 

The new merger was finalized on 1 January 1969, and the companies were incorporated as Audi NSU Auto Union AG with NSU’s Neckarsulm plant assigned as the headquarters. Audi was now back in the market with its original name and was recognized as a separate brand. It came to the United States in 1970 as its own brand, while NSU’s new launch was marketed and launched under the Volkswagen brand. By 1985, and so it remains today, the merged company’s name was shortened to just Audi AG. The headquarters of Audi AG was shifted back to Ingolstadt, Bavaria, and Auto Union GmbH and NSU GmbH were made subsidiaries. These subsidiaries are now in charge of managing the original companies’ intellectual property and operating Audi’s heritage operations.

Who Owns Audi? – History and Relocation

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