Established in 1871, Benz & Cie. was the most important of several companies founded by Karl Benz. The Benz patent motor wagon was ahead of its times; by 1886, Benz had the first four-stroke engine. Karl Benz is credited as the inventor of the first "true" automobile since Daimler's vehicle was a horse carriage adapted with an engine, whereas the 1886 Benz automobile had a chassis designed from scratch.
Daimler Motoren Gesellschaft-(DMG) was founded by Gottlieb Daimler and his partner Wilhelm Maybach in 1890. Daimler died in 1900 and Maybach left DMG in 1907. By then, Benz & Cie. and DMG were rivals. In 1924, owing to economic necessity after World War I, they entered into an "Agreement of Mutual Interest" valid until the year 2000. This initial agreement still allowed each company to manufacture and sell their products under their original brand names. After the official merger in June 28, 1926, the firm became known as Daimler-Benz.
The hyphenated brand name Mercedes-Benz was established after that merger. The brand name Daimler had been licensed for use on other automobiles in France and the United Kingdom, and was therefore not available to Daimler-Benz. Instead, the name of its seminal Mercedes model designed by Maybach over twenty years before was chosen for the DMG portion of the new brand. ("Mercedes" had been painted on a DMG vehicle used in races by a man in honor of his daughter, and became the formal name of a DMG model in 1902, see below.) Thus, Mercedes-Benz became the brand name applied to the models of one of the new firm. Because of its eponymous tie to Karl Benz and his early vehicles, Mercedes-Benz is also the name of the world's oldest continuously produced automobile line.
As part of the 1926 merger, a new logo was created that would include a symbol for each and integrate the names of the two former companies. A three-pointed star had been designed by Gottlieb Daimler, to show the ability of his motors for land, air, and sea use. This star first appeared on a DMG model in 1909, so it was chosen for the new logo. The traditional laurel wreath symbol used by Karl Benz was added along with his name to complete the new logo. The logo with a plain ring, as seen today, was not used until 1937.
The iconic symbol of Mercedes-Benz.
The iconic symbol of Mercedes-Benz.
In 1998, Daimler-Benz and Chrysler agreed to combine their businesses — promoted as the "merger of equals" — and the new entity was named DaimlerChrysler AG. However, this was actually when Daimler-Benz bought out Chrysler.
On May 14, 2007, the separation of Daimler AG and Chrysler LLC was announced. Selling Chrysler has been seen as a positive move for Daimler by its shareholders, who hope that the separation will allow Daimler's car brand Mercedes-Benz to be free to do what it does best without having the distractions of its heavily unprofitable U.S. partner Chrysler. However, Daimler retains a 20 per cent minority stake in Chrysler.
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