Audi: History of a Giant


Today, Audi is one the world’s most respected and influential carmakers. The modern era has seen Audi become a significant contributor to the evolution of the motorcar, with innovative engineering and pioneering design often leading the way for the industry. But like most things, it wasn’t always like this; in fact the story of Audi almost ended before it could begin. This post will examine the journey Audi has made from being one man’s unlikely dream, to becoming a giant multinational organisation with a truly global influence.

The Pre-Audi Years

The Audi story begins in 1909, when the brand was officially established as a carmaker. However, the ideas for what were to become August Horch’s car company, stretch even further back into the 19th Century. August Horch, an engineer from Winningen, was first able to put his engineering ideas to the test in a commercial environment, where he worked with Carl Benz as a works manager from 1896. Nevertheless, this relationship quickly turned due to conflicting engineering ideas, eventually leading to Horch departing the company and beginning his own in 1899.

Initially involved in repairing cars, Horch’s company also worked on improving cars. This, along with his innovative engineering ideas, led Horch to move his company into car manufacturing. Over the next eight years Horch’s company grew in size, manufacturing a large number of vehicles and even achieving success in motorsport events across Europe.

Horch’s desire to create more ‘exotic’ cars however, eventually led to disagreements with the company’s management, due to rising costs and ambitious design plans. These disagreements resulted in him resigning from the very company that bore his name. All was not lost however, as shortly after in 1909, Horch founded a new car manufacturer.

The birth of Audi

The name Audi, the Latin equivalent of Horch, was chosen for Horch’s new brand and quickly found itself placed on the front of the Audi Type A Sport Phaeton in 1910. This car served as the base for the following cars produced by Audi, each of them increasing in performance and achieving much success in European motorsport.

All was well for Audi until the collapse of the German economy led to dwindling private vehicle demand, and as a result financial trouble quickly engulfed the firm soon after the close of the First World War. German automaker DKW came to the rescue however, acquiring the brand and injecting much needed finances into Audi, allowing it to resume with the building of sports vehicles. Despite a strong few years both brands were acquired by German giant Auto Union in 1933. It was during this Auto Union era that the ‘Four Rings’, now recognised as the logo for Audi, were created. These rings represented the four brands that Auto Union now encompassed: Audi, Horch, DKW and Wanderer.

During these early years Audi was able to dip its toe in international motorsport, under the Auto Union name of course. Its Grand Prix cars were highly successful racers, bringing engineering innovation and advanced aerodynamics to the sport, helping them to build global respect and brand awareness. This resulted in the group becoming Germany’s second biggest automaker; a valuable economic asset to what was still a growing economy.

Post World War Two

Despite its power and success, Auto Union took a hard hit after the close of the Second World War. The new authorities that controlled the then broken Germany, ensured all manufacturing plants and tools were utilised to rebuild the country. This meant along with thousands of other companies, Auto Union was closed to allow the utilisation of its assets.

Nevertheless, the company was soon to be reborn thanks to the efforts of its board members, who managed to relocate the firm into West Germany, where the rebuilding and manufacturing of existing vehicle models quickly began. Despite re-entering the market, slow progress was made due the growth of German competitors Volkswagen and Opel. Auto Union’s dated pre-war vehicles saw the company struggle to make profit, meaning when new models were introduced, they were designed under limited budget. This hampered competition further, leading to the Auto Union brand name being sidelined in order to ditch the ‘dated’ image its cars had begun to receive.

In 1964 Germany’s largest automaker family, Volkswagen, then stepped in and became outright owner of the Auto Union assets, assigning an entirely new team to the board and restructuring the company layout. To re-brand the company the Audi name was brought back for the first time in 25 years, and therefore this year marked the birth of what we now know as the modern Audi brand.

Modern Audi

With an injection of capital from parent company Volkswagen and an entirely new board of directors, Audi went from strength to strength, beginning a period of existence where the production of iconic cars and pioneering racers was to become the norm.

The seventies saw a range of practical city cars accompany luxury saloons, ensuring Audi’s products were aligned perfectly to market demands. The eighties also saw more success, with its spectacular quattro acting as a ‘game changer’ in the industry, as well as becoming a dominant force in the World Rally Championship thanks to its four-wheel drive system. Motorsport success became a key part of Audi’s brand again, with European Touring Car titles and rally success making the marque a dominant force in the sporting world.

Into the eighties and it was time for Audi to expand further. With factories opening up in China, Audi was set to take on the world. Emerging economies of the East welcomed the German investment, and as a result Audi’s production in China became a valuable asset to the Volkswagen group.

In fact they proved to more valuable than the group could have imagined, especially during the economic crash that hampered progress of Germany’s re-unification in the early nineties. Demand slumped by over a quarter, so the growing demand of Asia was a welcome relief as European sales fell. This Asian growth also helped to soften the blow of an American slump in demand, due to a television show hinting at safety issues with the marque’s 5000 model, which apparently accelerated on its own. No solid evidence was found to back up these claims, but this didn’t stop 50% of American sales to disappear in 1987. Audi responded by modifying existing and new cars to reduce the chances of ‘human error’, the likely cause for any unintentional acceleration during these years.

Once confidence returned to the US, growth resumed shortly after and headed the way for Audi’s innovative entry into the 21st Century. Its introduction of an all aluminium space frame construction was not only effective in reducing weight and improving strength for its cars during the late 1990s, but also a world first for a mass-market automaker. The A2 was perhaps the best example of Audi’s new approach to efficient motoring, with a wind tunnel influenced design and lightweight construction being the first of many Audi cars of this type. Even at the opposite end of its range, the Audi A8 was able to harness class-leading efficiency and performance thanks to its aluminium space frame, and of course Quattro four-wheel drive system.

Today the story is very much the same, with Audi continuing to innovate and develop at an impressive rate. Partially driven by its Le Mans racing motorsport success, Audi produces some of the world’s most efficient diesel engines, utilising advanced flywheel hybrid technology developed by Williams F1. But Audi also produces some of the world’s most powerful engines, with the Volkswagen Group W12 engine fitted to its current A8 flagship model producing 493bhp, helping the luxury super-saloon to reach 60mph in just 4.5 seconds.

Combining this performance with efficiency is also something Audi leads the way in. Utilising cylinder deactivation technology, its engines can half the number of cylinders they use under calm driving conditions, meaning fuel is saved and emissions are reduced. Under heavy power all cylinders can be activated again, meaning performance is restored when required. One of the most exciting cars of the Audi range, the R8, will be fitted with this technology when the next generation is launched in 2015. Astounding performance will no doubt be accompanied by much improved efficiency.

The future

Audi is currently one of the world’s most profitable car manufacturers, with over 1.4 million cars being produced in 2012 alone equating to a €4.35 billion profit in the same year. Investment into hybrid technology, cylinder deactivation and diesel power all show Audi is entering a period of efficiency innovation. Its complex, lightweight constructions that utilise aluminium and sometimes even carbon fibre, mean Audi is now able to compete not only with its luxury rivals, BMW and Mercedes, but also performance marques such as Ferrari and Aston Martin. There’s no doubting the future for Audi looks very bright, not just because of its recent love of LED lighting systems, but also due to its constant pursuit of engineering perfection. It’s safe to say a certain engineer who went by the name of August Horch, would probably have been very proud to hear that.


  • AUDI AG. 2012. Audi Group Key Figures. Audi 2012 Annual Report. AUDI AG: Ingolstadt.
  • Harris, P. 1999. Sutton’s Photographic History of Transport: Audi. Sutton Publishing Ltd: Stroud.
  • Holweg, M. 2009. The Evolution of Competition in the Automotive Industry. In: Parry, G & Graves, A. 2008 ed. Build to Order: The Road to the 5-Day Car. Springer: UK
  • Kirchberg, P et al. 2001. A History of Progress: Chronicle of the AUDI AG. AUDI AG: Ingolstadt.
  • Ingram, R. 2013. Audi A1 and A3 now available with cylinder deactivation tech. [Online:]
  • 2010. Audi A8 Saloon (10 on) – Review. [Online]

About sam sheehan Freelance automotive writer and MA Automotive Journalism student

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