It’s probable that the only people who know who the Quandt family are, are BMW aficionados! The Quandt family saved BMW from a fate that befell many other manufacturers: either bankruptcy or acquisition and brand suppression. The family are one of the richest in Europe and are the masters of keeping under the radar – they do not air their dirty laundry (if they have any) and work to keep their assets profitable! The Quandt family’s fortune came from marrying well and then not wasting the opportunities presented – and being on the right side, even if that meant switching sides occasionally!
The success started with Emil, born in 1849 in the town of Pritzwalk in the eastern side of Germany. At the age of sixteen, he went to work for the Draeger Brothers, a family of weavers and textile manufacturers, married one of the daughters and bought the business from the family, adding two other local factories as the business grew. This became the foundation of a family empire that successive generations expanded and made more valuable.
Emil had three sons and two daughters and one of the sons, Gunther (born 1881), followed him into the textile business, taking control in 1900. With the First World War, the business increased the fortune by supplying the German Army with uniforms and that fortune was used to invest in new technologies such as lead-acid batteries and cars. Gunther invested in the company that became VARTA Batteries and also a nascent BMW as well as the more established Daimler-Benz. BMW had been founded in 1916 to build aircraft engines and moved into motorcycles and cars during the 1920s and 1930s through development and acquisition projects.
Gunther was married twice and had two sons from his first wife, Helmut (born 1908) and Herbert (born 1910), and then another son from his second wife, Harald (born 1921). Helmut died early in life, however both Herbert and Harald (and their families) were instrumental in building on their father and grandfather’s legacy. After Gunther divorced his second wife, Magda, she married Joseph Goebbels, the Nazi Party Minister of Propaganda – Hitler was their best man! Magda committed suicide with Goebbels in a Berlin bunker along with their six children at the end of the war.
In 1933, when the Nazi Party were elected to power in Germany, Hitler looked to the country’s industrialists to help him and Gunther Quandt became not only a member of the party but also the “Leader of the Defence Economy”. Like the US today under President Trump, this layer of wealthy men managed to control the country and increase their fortunes substantially. Gunther, now with many businesses under his control, supplied the nation with a wide variety of products used by the military and industry. His factories were filled with “slave” labour where undesirables were rounded up and forced to work in prison conditions.
When the Second World War ended, he was arrested for his part in supplying the war machine with ammunition and components, especially because he had used prisoners as workers, taken control of other factories with the help of the Nazis and had turned a blind eye to the deaths that occurred in the factories by the military. He was also seen as a collaborator because his ex-wife had married into the upper echelons of the Party! Not that he could have influenced her not too. He spent two years in prison before being found not guilty and on release simply took management positions within the family empire and other entities such as Deutsche Bank.
Gunther died in 1954 whilst on holiday in Egypt, however his two sons were as switched on as he was and continued the family business. Harald took over the industrial, machining and engineering businesses whilst Herbert looked after the investments in VARTA, Daimler-Benz and BMW. Between them they managed 200 companies in total! On the death of Gunther, the two brothers controlled 10% of Daimler and 30% of BMW. Harald sadly was killed in a plane crash in 1967 having successfully grown the non-automotive companies, although one of them IWKA had developed the Amphicar, an amphibious vehicle that sank with Harald’s death.
Harald, the younger scion, had five daughters, Katarina (born 1951), Gabriele (born 1952), Anette (born 1954), Colleen-Bettina (1962) and Patricia (1967-2005). After his death, they became the beneficiaries of a family trust fund, which has been managed very well over the last 4 decades.
Herbert though, was a master with automotive businesses, however BMW was struggling during the 1950s even though they had a good motorcycle business and had licensed the Isetta bubble car, which was a very popular car in Europe as the population needed cheap transportation. BMW were struggling to compete with other manufacturers in higher profit market segments and by 1959, the management was considering selling out to Daimler-Benz because the company was struggling to expand its market.
Herbert with the family investment in both companies was initially in agreement, however after seeing the reaction to the sale by the workers and local communities who were concerned about job losses, he changed his mind. Rather than selling the family’s 30% to Daimler, he increased the stake in BMW to 50% and took control. BMW had been developing a new car, the 1500, which had contributed to the poor state of the business, however Herbert saw the car as a saviour. With the help of Harald, Herbert re-energised the business and launched the new range of mid-tier cars in 1962 resulting in profits as opposed to the many years of losses. It was the turning point for the company and ultimately saved them from failure.
Herbert followed his father in another way, he was married three times and had six children and like his father who named his children with “H” names, Herbert liked “S”: Silvia (born 1937), Sonja (born 1951), Sabina (born 1953), Sven (born 1956), Susanne (born 1962) and Stefan (1966). All of the children are shareholders in the family business with many of them taking management roles in BMW or other companies in the investment group. Herbert died in 1982 and his third wife, Johanna, took control of much of the family investments increasing their wealth several times over.
The Quandt family sold their stake in Daimler-Benz to the Government of Kuwait in 1974 and continue to be a major shareholder of much of Germany’s industrial heartland including BMW. Today the family are multi-billionaires – Susanne and Stefan hold the 3rd and 4th spots on the 2019 German Wealth list with a combined US$38B and this doesn’t include their siblings or cousins. As we described earlier, they are a secretive family and for decades their involvement with the Nazi Party was kept quiet, although it was probably an open secret in some communities. Then a documentary maker released a film that discussed the nastier side of the war-time involvement and the Quandt family paid for a full research project into that involvement to record what had actually happened.
The family came out relatively unscathed, mainly because although Gunther had benefited from his involvement with the Party, had he not contributed, the family may have been imprisoned themselves which could have ended in execution. It’s not a good decision to make – both options are as bad as each other.
If it wasn’t for Herbert’s strategy and Harald agreeing to it, BMW would have become a sub-brand under Mercedes-Benz or more likely would have gone the same route as NSU: a marque that has long gone. That would have affected the automotive industry over the last half century – there would have been no innovative cars or motorcycles, no championship winning racing engines including in F1 and F2 and no saviour for Rolls-Royce and Mini! We also mustn’t forget the work that Johanna Quandt did with BMW after her husband’s death. Her leadership during the 1980s and 1990s were critical to the expansion of the company and the success we see today.