November 30, 2006
Hitler’s carmaker: How General Motors helped jump-start the Third Reich’s military machine
Impressive production statistics aside, the Fuhrer was fascinated with every aspect of the automobile, its history, its inherent liberating appeal and, of course, its application as a weapon of war. While German automotive engineers were famous for their engineering innovations, the lack of ready petroleum supplies and gas stations in Germany, coupled with the nation's massive Depression unemployment, kept autos out of reach for the common man in Nazi Germany. In 1928, just before the Depression hit, one in five Americans owned a car, while in Germany, ownership was one in 134.
In fact, just two months before Mooney's meeting at the Chancellery, Hitler had commented at the Berlin International Automobile and Motor Cycle Show: "It can only be said with profound sadness that, in the present age of civilization, the ordinary, hard-working citizen is still unable to afford a car, a means of up-to-date transport and a source of enjoyment in the leisure hours."
Even if few Germans could afford cars -- GM or otherwise -- the company did provide many in the Third Reich with jobs. Hitler was keenly aware that GM, unlike German carmakers, used mass production techniques pioneered in Detroit, so-called "Fordism" or "American production."
As the May 2, 1934, Chancellery meeting progressed, Hitler thanked Mooney and GM for being a major employer -- some 17,000 jobs -- in a Germany where Nazi success hinged on re-employment. Moreover, since Opel was responsible for some 65 percent of auto exports, the company also earned the foreign currency the Reich desperately needed to purchase raw materials for re-employment, as well as for the regime's crash rearmament program. Now, as Hitler embarked on a massive, threatening rearmament program, GM was in a position to make Germany's military a powerful, modern and motorized marvel.
The Quest for the "People's Car"
During the meeting with Mooney, Hitler estimated that if Germany were to emulate American ratios, the Reich should possess some 12 million cars. But, Hitler added, 3 million cars was a more realistic target under the circumstances. Even this would be a vast improvement over the 104,000 vehicles manufactured in Germany in 1932.
Mooney told Hitler that GM was willing to mass produce a cheap car, costing just 1,400 marks, with the mass appeal of Henry Ford's Model T, if the Nazi regime could guarantee 100,000 car sales annually, issue a decree limiting dealer commissions and control the price of raw materials. Many automotive concerns were vying for the chance to build Hitler's dream, a people's car or "volkswagen," but GM was convinced that it alone possessed the proven production know-how. An excited Hitler showered his GM guests with many questions. Would the cost of garaging a car be prohibitive for the average man? Could vehicles parked outdoors be damaged by the elements?
Mooney answered that the same vehicle built to withstand wind, dust and rain at 40-60 mph could stand up to overnight exposure outdoors. To promote automobile ownership, Hitler even promised something as trivial as legalized street parking.
Of course, Hitler had already committed the Reich to expedite completion of the world's first transnational network of auto highways, the Autobahn. Now, to further promote motorcar proliferation, Hitler suggested to Mooney that the German government could also reduce gasoline prices and gasoline taxes. Hitler even asked if Opel could advise him how to prudently reduce car insurance rates, thus lowering overall operating costs for average Germans.
The conference in Hitler's Chancellery office, originally scheduled for a quarter hour, stretched to 90 minutes.
The next morning, May 3, 1934, an excited Hitler told Keppler, "I have been thinking all night about the many things that these Opel men told me." He instructed Keppler, "Get in touch with them before they leave Berlin." Hitler wanted to know still more. Mooney spent hours later that day ensconced in his hotel suite composing written answers to the Fuhrer's many additional questions.
Clearly, Hitler saw the mass adoption of autos as part of Germany's great destiny. No wonder Mooney and GM were optimistic about the prospects for a strategic relationship with Nazi Germany.
A few weeks after the prolonged Chancellery session, the company publication, General Motors World, effusively recounted the meeting, proclaiming, "Hitler is a strong man, well fitted to lead the German people out of their former economic distress.... He is leading them, not by force or fear, but by intelligent planning and execution of fundamentally sound principles of government."
Ironically, Hitler's famous inability to follow up on ideas caused GM officials to wonder if they had been too revealing in their company publication's coverage of the Chancellery meeting. Copies of General Motors World were seized by Opel company officials before they could circulate in Germany. Mooney later declared he would do nothing to make Hitler angry.
For Mooney and for Germany's branch of GM the relationship with the Third Reich was first and foremost about making money -- billions in 21st century dollars -- off the Nazi desire to rearm, even though the world expected that Germany would plunge Europe and America into a devastating war.
Typical of news coverage of events at the time was an article in the March 26, 1933, edition of The New York Times headlined, "Hitler a Menace." The article, quoting former Princeton University President John Hibben, echoed the war fear spreading across both sides of the Atlantic. "Adolf Hitler is a menace to the world's peace, and if his policies bring war to Europe, the United States cannot escape participating," the article opened. This was one of dozens of such articles that ran in American newspapers of the day, complemented by continuous radio and newsreel coverage in the same vein.
However, the commanding, decision-making force at the carmaker was not Mooney, GM's man in Nazi Germany, but rather the company's cold and calculating president, Alfred P. Sloan, who operated out of corporate headquarters in Detroit and New York. continued....