The story
Founded by Gottlieb Daimler and Wilhelm Maybach in 1890, in Stuttgart.1
Daimler, Maybach, and DMG at Seelberg
By 1882 both Daimler and Maybach had left Nikolaus Otto's Deutz AG Gasmotorenfabrik. In 1890 they founded their own engine business, Daimler Motoren Gesellschaft (DMG). Its purpose was the construction of small, high speed engines they had developed based on the same stationary engine technology.
DMG thus grew out of an extension of the independent businesses of Daimler and Maybach, who would revolutionize the world with their inventions for the automobile of a four-stroke petrol engine, carburetor, and so on. They would manufacture small internal combustion engines suitable for use on land, sea, and in the air (the basis for a symbol Daimler devised of a three pointed star, with each point indicating a different way).
On 5 July 1887 Daimler purchased a property in Seelberg Hill (Cannstatt) previously owned by Zeitler & Missel who had used it as a precious metal foundry. The site covered 2,903 square meters, cost 30,200 Goldmark, and from it they produced engines for their successful Neckar motorboat. They also sold licences for others to make their engine products and Seelberg became a centre of the rapidly growing automobile industry.
Daimler ran into financial problems because sales were not high enough and the licences didn't yield significant profit. An agreement was reached with industrialists Max Von Duttenhofer and Wilhelm Lorenz, both of whom were also munitions manufacturers, along with the influential banker Kilian von Steiner, who owned an investment bank, to convert the private business to a public corporation in 1890. (This agreement is regarded by some historians as a "devil's pact", as the inventors never got along with the new status.)
Not really believing in automobile production the financiers expanded the stationary engine business, as they were selling well, and even considered a merger with Otto's Deutz-AG. (During 1882, Gottflieb Daimler had serious personal problems with Nicholas Otto, when Daimler and Maybach worked for Otto.) Daimler and Maybach continued to advocate car manufacturing and as a result even left DMG for a short period. Daimler's friend, Frederick Simms, persuaded the financiers to take Gottflieb Daimler and Wilhelm Maybach back into faltering DMG in early 1896. Their business was re-merged with DMG's. Daimler was appointed General Inspector, Maybach chief Technical Director and Simms a director of DMG.
In 1892, Maybach designed the Phönix, an inline two-cylinder engine fitted with a new carburetor. Following the withdrawal of Gottlieb Daimler and Maybach to their own business to concentrate on cars, the enterprise had been close to a crisis but stabilised itself, selling mobile and stationary engines through a number of retailers around the world, from New York City to Moscow.
The first Daimler car, a singularly inelegant model, appeared in 1892, followed in 1895 by a two-cylinder vis á vis and, in 1897, DMG's first front-engined model, a Phönix-engined four-seat open tourer.
In 1900, Gottlieb Daimler died. Later DMG's successful Mercedes models based upon race cars designed by Wilhelm Maybach to the specifications of Emil Jellinek (who wanted a more modern and safer car, following the death of Willhelm Bauer in a Daimler racer) changed the board's outlook in favour of the automobile. Maybach continued as designer for a while, but quit in 1907 and was replaced by Gottlieb's son, Paul.
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Expansion (1902 to 1920)
DMG's automobile sales took off, particularly with the first Daimler-Mercedes engine designed by Maybach placed into several race cars of 1900 built for Emil Jellinek. That race car was later referred to as the Mercedes 35 hp. Production capacity was extended to Untertürkheim. In 1902, DMG produce the first Mercedes models, led by the 60, the most famous early model, and officially adopted Mercedes as its automobile trademark; capable of 120 km/h (75 mph), the 60 combined touring and racing capacity, and was the top-status car to own (or for other makers, among them Berliet, Rochet-Schneier, Martini, Ariel, Star and FIAT, to copy; in the U.S., Daimler Manufacturing Company {Long Island City, New York} may have built one under licence in association with Steinway). In part due to the model 60's success, the number of DMG employees went from 821 (1903) to 2,200 (1904).
1906 to 1913 were further expansion years, with the creation of new capacity reducing the number of external suppliers. Increased mechanization took the annual productivity from 0.7 cars per worker, to 10. In 1911, shares of DMG were listed on the Stuttgart stock exchange.
Berlin-Marienfelde
On 2 October 1902 DMG opened a new works in the mountainous region to the south of Berlin. Its scope was initially limited to motorboat and marine engines. Later, it expanded into making trucks (1905) and fire trucks (1907). The region became a centre of the automobile industry, and other businesses moved in.
Untertürkheim
Untertürkheim was an ideal location to site a large factory as it was close to both the Neckar river and the Stuttgart–Ulm railway. The local Mayor Eduard Fiechtner sold the land (185,000 square meters) at a low price and also arranged for a railroad extension with its own station and energy from the Neckar's hydro-electric plant which had been built in 1900.
DMG had planned to open the facility in 1905 but the total destruction of Cannstatt's factory by fire in 1903 hastened the work and the new Art-Nouveau building, with a jagged-roof, was brought forward to start production in December 1903. The work force continued to grow.
On 17 May 1904 Unterturkheim became DMG's headquarters with the rest of the administration staff moving in on 29 May. In 1913, an additional 220,000 square meters were acquired and between 1915 and 1918 it was extended further. By the 1920s, Untertürkheim had almost all the production processes on one site from foundries to final car assembly. In 1925 the DMG design department also moved in.
The Cannstatt Fire (1903)
On the night of 10 June 1903 the original Seelberg-Cannstatt plant suffered a great fire. All the machinery and 93 finished Mercedes cars, a quarter of the annual production, were destroyed, together with a small museum with historical items like Daimler-Maybach's first ever motorcycle, the Reitwagen.
The displaced workers received haven-salaries and additional bread rations. Neighboring businesses lent workshops, allowing production to continue. DMG created a Relief Fund (one of the first worker insurance schemes) and began building separator blocks in all its plants.
The following year, 1904, the whole operation moved to Untertürkheim. The last unit produced in Seelberg rolled out in the first weeks of 1905.
Sindelfingen
At the outbreak of the First World War, in 1914, there was a rush to produce war supplies. In the autumn of 1915, DMG opened the Sindelfingen factory for military vehicles, aircraft engines, and even entire aircraft. After the war, limited by the Versailles Treaty, it produced only automobile bodies.
From Wikipedia’s article on Daimler Motoren Gesellschaft, shared under CC BY-SA 4.0.3