40th Anniversary NSU and Auto Union Merger

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April 24, 2009

Source: Audi Tradition

Success story followed a momentous start

• 40 years since the merger of NSU Motorenwerke AG and Auto Union GmbH

• Formation of Audi NSU Auto Union AG laid the foundation for the AUDI AG of today

• Heated discussions accompanied the stockholders meeting in 1969

Ingolstadt/Neckarsulm – Neckarsulm on April 26, 1969: the first day of Audi NSU Auto Union, the company that would later develop into the AUDI AG we know today, was a momentous occasion. Following at times heated discussions at the extraordinary general meeting of NSU Motorenwerke AG held 40 years ago, the NSU stockholders finally approved a merger with the VW subsidiary Auto Union GmbH. The press dubbed the event the “stockholders meeting of the year” – after all, the birth of the new company was not without its share of controversy.

Having taken over the controlling stake in Auto Union GmbH in December 1964, Volkswagen, in search of new production capacity, went on to gradually acquire a majority interest in NSU Motorenwerke AG in the late sixties. Following this acquisition, the parent company sought to bring about a merger between its two subsidiaries based in Ingolstadt und Neckarsulm.

On March 10, 1969, a merger agreement was signed between Auto Union GmbH and NSU Motorenwerke AG. After exactly 12 hours and 21 minutes of sometimes heated discussion with initial resistance from the NSU stockholders, the agreement was approved at a special meeting of stockholders on April 26, 1969. On August 21, 1969 the agreement became effective with the merger backdated to January 1, 1969. The key argument that clinched the NSU stockholders’ approval was the conversion of income from the so-called “Wankel licenses” into NSU participation certificates, which remained in the hands of the NSU stockholders after the merger. VW then transferred its shares in its Auto Union subsidiary to NSU. The new firm was named Audi NSU Auto Union AG. Neckarsulm became the company’s corporate seat and Dr. Gerd Stieler von Heydekampf, chief executive of NSU at the time, was appointed as chairman of the board of management.

In NSU Motorenwerke AG, Volkswagen had acquired a company with a long and rich tradition. The former bicycle manufacturer, which had originally started out making knitting machines, has a history going back to 1873. In 1900 it was one of the first companies in Germany to be building motorcycles, and as early as 1906 NSU produced its first car, named the “First Neckarsulm Motor Car”. NSU became the world’s largest maker of two-wheeled vehicles in 1955. Two years later, the company started production of a new car, the NSU Prinz, thus creating one of the protagonists of the German Economic Miracle.

NSU also made a name for itself by developing the rotary piston engine (known as the Wankel engine after its inventor Felix Wankel). Although, in the end, the technology did not achieve widespread application, the new engine concept attracted keen worldwide interest at the time. NSU sold Wankel licenses to carmakers around the globe, including Mercedes-Benz, Rolls Royce, Mazda, Citroen and General Motors. The company based in Neckarsulm became the first German manufacturer to win the “Car of the Year” award with its NSU Ro 80 in 1967. This luxury-class saloon with its futuristic streamlined look is still considered a design icon today. In 1969 NSU was also on the point of unveiling a mid-class car, the K 70, which was later launched as a VW model.

At the time of the merger, NSU was producing some 128,000 cars per year with annual sales in excess of 566 million marks. Its new partner in Ingolstadt could present even more impressive numbers: in 1968 Auto Union posted sales of more than 590 million marks. However, VW Beetle assembly accounted for a major share of this figure. In the same year, over 92,000 VW Beetles and some 70,000 Audi models were produced in the Auto Union factory in Ingolstadt. As a result of the merger, the new company’s equity rose to 215 million marks and its workforce increased to over 23,000. In the year of the merger, the newly formed southern German car manufacturer already achieved record sales of more than 1.6 billion marks (+ 43 percent) and produced some 265,000 cars (+ 33 percent), thus exceeding all expectations. The merger of NSU and Auto Union was to prove highly successful. The wide variety of technically advanced concepts in the Audi NSU product range at the time gave rise in 1971 to the advertising slogan that still stands for the Audi name today: Vorsprung durch Technik.

In 2009, the Audi brand established by August Horch on July 16, 1909 celebrates its centenary. The four rings of the Audi badge symbolise the brands Audi, DKW, Horch and Wanderer, which were combined to form Auto Union in 1932. Auto Union and NSU, which merged in 1969, both made many significant contributions towards the development of the car. AUDI AG was formed from Audi NSU Auto Union AG in 1985. Together with the two traditional companies Auto Union GmbH and NSU GmbH, Audi Tradition has nurtured the extensive, diverse history of Audi for many years and presented it to the public. The Audi museum mobile at the Audi Forum Ingolstadt is open daily from Monday to Sunday, from 9 a.m. to 6 p.m. The August Horch Museum in Zwickau is open from Tuesday to Sunday from 9.30 a.m. to 5 p.m.

AUDI AG sold a total of 1,003,469 cars in 2008 and thus achieved its 13th consecutive record year. The Company posted new record figures with revenue of €34.2 billion and profit before tax of €3.2 billion. Audi produces vehicles in Ingolstadt and Neckarsulm (Germany), Györ (Hungary), Changchun (China) and Brussels (Belgium). Aurangabad in India saw the start of CKD production of the Audi A6 at the end of 2007 and of the Audi A4 in early October 2008. The Company is active in more than 100 markets worldwide. AUDI AG’s wholly owned subsidiaries include Automobili Lamborghini Holding S.p.A. in Sant’Agata Bolognese (Italy) and quattro GmbH in Neckarsulm. Audi currently employs around 58,000 people worldwide, including 46,500 in Germany. The brand with the four rings invests around €2 billion each year in order to sustain the company’s technological lead embodied in its “Vorsprung durch Technik” slogan. Audi plans to significantly increase the number of models in its portfolio by 2015 to 40. The AUDI brand celebrates its 100th birthday in 2009. The company was founded by August Horch in Zwickau on July 16, 1909; he named it AUDI after the Latin translation of his surname (“hark!”).

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