HN 2: The British and their Works

SMMT to acquire the factory lock stock and barrel. His suggestion
was discussed at the highest ministerial level, provoking a
heated altercation with the automotive industry. The main
focus of their interest was not the Volkswagen itself, which at its
current development stage was less advanced than the top
British models and did not meet current British standards with
respect to comfort and quality. The factory was a different
matter altogether since, under normal economic conditions, its
modern production lines would enable mass production with a
level of efficiency that could not be equalled by any British
motor manufacturer. Ultimately, however, this was the factor
that stood in the way of an outright takeover of the Volkswagen
plant. Because its production capacity dwarfed that of the
English manufacturers, there was no way of acquiring it without
severely restricting the domestic automotive industry. Repeated
speculations about dividing the Volkswagenwerk between
France and Great Britain were refuted by the simple observation
that dismantling the plant would eliminate the economic
advantages offered by its size. And so the British motor industry
was banking on the dismantling programme to hand it the choicest
bits on a plate. 22
In the Ministry of Trade and the Ministry of Supply it found two
influential allies who shared its fear of the re-emergence of a
direct competitor. There was also a need for action because
France had indicated an interest in the Volkswagenwerk. A
united front against the call for dismantling was put up by the
Foreign Office, the Treasury and the Control Commission for
Germany, the latter with the argument that the Military
Government’s responsibility was to Germany, and it was not
their remit to support the objectives of British industry. The
Treasury was primarily concerned with securing additional
income in order to relieve the budget of occupation costs. And
export of the Volkswagen promised currency earnings.
The battle of the ministries was ultimately decided by the start
of negotiations for the setting up of the Bizone in the summer
of 1946. Whilst the British lost authority, the Americans regained
their dominant role. But their occupation policy was now
directed at a swift reconstruction of the German economy. In
September 1946, the British military government suspended
reparations for the Volkswagen plant for four years. One month
later the Level of Industry Plan was suspended. 23 For the time
being, the survival of the Volkswagenwerk was assured. ■