HN 2: The British and their Works

At a discussion evening in the Volkswagenwerk on 3rd June 1947,
Property Control Officer F. T. Neal raised the question of what
legal form the company should take in future. He had shortly
before been at Berlin headquarters, and learned there of
the intention of placing the factory in the hands of the German
people. The proposal he himself submitted called for the
management of the factory to be transferred to a managing
board of trustees. These should be responsible to a body made
up of representatives of the highest government departments,
the union, the state government, the banks and local govern-
ment. 222
4.3
The transfer to German ownership
This proposal of Neal’s more or less reflected the solution envisaged
by the Property Control Branch, although in his inclusion
of the banks and local government he went slightly
beyond the model currently in favour. In the trust company to
be set up, the state and the federal government should be represented,
and in the supervisory board the unions and various
state governments. The strict preference of the Property Control
Branch for a public company was remarkable insofar as this
amounted, to a certain extent, to a continuation of the original
form of the company. Their endeavour to make the Volkswagenwerk
into a shining example of a democratically controlled
industrial corporation, however, found no support at the
Industry Division. Because the latter was averse to the socialistic
aspect of the whole thing, the suggestion was blocked. 223
It would probably have been simplest to have followed the letter
of Directive 50, adopted in April 1947, and to have transferred the
entire DAF assets to the appropriate state government, with the
exception of assets belonging to a union, a trade association or
a charitable association. But the Military Government excepted
the Volkswagenwerk from this regulation, keeping control in
their own hands. One reason for this was the property rights
claimed by the German unions. The "IG Metall" maintained that
the German Labour Front had been set up with the confiscated
assets of the unions which had been broken up in 1933. Although
the directive offered grounds for doing so, the Military
Government did not conclusively reject this claim. As with the
subsequent transfer of the plant to the German federal government,
it held the matter in suspense, but deflected the unions’
claim for the time being. The claims of the former savers for the
"Strength through Joy" car, who went to court demanding their
money or their cars, also went unredeemed, because the Control
Commission for Germany feared that too early a verdict could
bankrupt the company.
A transfer of the factory to the government of Lower Saxony
would have meant that the British could conveniently unload
this problem. But with an eye to the potential economic power
of the Volkswagenwerk they hesitated to take this course. In the
hands of a state government, the Property Control Division warned,
it would be a dangerous weapon which could be directed
against the victorious powers. Thus the military government
maintained the status quo, until such time as the forthcoming
establishment of a federal German government in 1949 started
things moving again. In June the Property Control offered the
state of Lower Saxony direct control over the Volkswagenwerk.