Three months later he was Head of the Methods testing Department, and exactly one year later, he headed the Process Engineering General Department. Since then his rise has been astronomic and sometimes controversial. Few observers will forget the time he halted production of the Seven Series and re-devised and re-designed the entire range from entry point to top level.

VIVE: How did your earliest interest in cars evolve to the point that it became your career?

REITZLE: Cars always fascinated me. When I was a child I knew all about cars, it was always fascinating for me and when I studied I realised that the car business uses all kinds of technologies; metal, synthetics, glass, electronics. And if you have a detailed look, textiles. You can't find any other product where so many different technologies come together and it is fascinating for an engineer.

VIVE: In those days, however, you must have realised that there were only a handful of good car companies and there must have been millions of engineers dying to get into those companies. Where did you get the confidence to foresee that one day you would perhaps be sitting in this position?

REITZLE: I went to university and actually wanted to go into the airplane industry but as I was making that decision it was just at the time that the Apollo programme was cancelled, NASA was laying off people and in Germany at this time there were only two companies that one could go to. In the automobile industry there was much more, so I changed my original plan; when you're young you always change your mind, so I made the choice to go with BMW and tried to get a job when I was twenty-five years old.

VIVE: Obviously you got the job. What were your first duties?

REITZLE: I began at the lowest level possible for an engineer. I started in the Manufacturing / Technology Development area. I started in a workshop and I was the only engineer in a group of 30 people. That was very good for me because when you come from university you 're theoretically very proficient but in practical terms you know very little, having had very little experience. So I immediately took this opportunity because I could see it would only benefit me to get practical experience in this area.

VIVE: What were your first impressions? With the sixties and the moon landings everyone wanted to be an engineer.

REITZLE: My first impressions were totally different. If you enter a company there is a certain image that you have of the company and what is behind the walls, and when I came in it was very different - especially in the area I was involved with - it was very practical and there was little theory involved. The first month I started there the first robot was shipped to BMW from the United States and Unimate. It was one of the first robots developed in America; this robot came to our department and we made the first investigations into its technology. We started with automation in this area over twenty years ago.

The next step was that I became the head, the foreman if you like, of these 30 people and it took a few months to get accepted, because I had a Doctorate in Engineering - in the entire company I think we had two Doctors of Engineering - and they couldn't quite understand why we needed another. But within a few months they realised that the theory could be very beneficial to the practical solutions required, that different solutions could be found for problems.

VIVE: From foreman, what happened next?

REITZLE: About two years later I got into a department where there were other engineers and my colleagues at this time were developing new manufacturing technologies and we were the workshop that had to transfer these technologies into the prototype for manufacturing systems. For instance, if you change one welding system into another type of welding system you have to undertake research and detailed investigations. Eventually I became head of this research application department of engineers, so then I was responsible not only for the workshop but for this engineering area where we developed new manufacturing technology; new automation systems especially for the body shop, for the paint shop and for the assembly plant.

It was at this time that we launched a new model; we introduced the Seven. This Seven gave us some difficulty when it was introduced into the factory in terms of what I call 'poor manufacture-friendly' design. The engineering department said to the plant 'You have to produce the car as we designed', and the manufacturing plant said 'We can't produce the car as you designed, we have to change it'. This created some conflict and I considered that this shouldn't happen again where there is such a misunderstanding between the design and production facilities, which is when I came up with the idea of establishing a pilot plant to iron out any problems created by Research and Development. Before the car goes into production it is checked under the same conditions as those of a production line, but on a smaller scale.

Another benefit of this system is that we can train the people in the factory. We bring them over to the pilot plant where they take the car through the production process and gain an understanding of how the car will look and how the assembly process will work.

This system hadn't existed at BMW before this so I wrote a brief paper and handed it over to the member of the board responsible for production, Mr. Kohl, who was quite a few stages beyond me in the hierarchy. This upset a few people but at the time I didn't realise it being somewhat young and ill-informed in the ways of the hierarchical structure. Mr. Kohl was very receptive to this idea and handed it over to the board, who then asked me to make a presentation of this paper. It was quite a nerve-wracking experience being confronted by all these important people but when I had finished they appointed me in charge of this project. This was in addition to my normal job and to cut a long story short, two years later the pilot project had been set up in an old building on the plant and the old Five, which was the next car, was the first model to be manufactured under this system. In comparison to the old Seven it was considered perfect even though in relation to today's models it was still lacking. So, the pilot plant system was considered very successful and from then on was well received. Today it is an institution.

VIVE: At that stage you obviously started attracting the attention of the board .

REITZLE: That came a bit later. It was considered, particularly by Mr. Von Kuenheim, [then Chairman of the Board], that it would be beneficial for me to be not only responsible for the clinical area of manufacturing; the more sophisticated job of developing and introducing new systems, but that for a certain time I would have to be responsible for production. So for a year and a half I was Manager of the Engine and Axles plant and was responsible for a few thousand people with all the attendant problems; problems with unions, with the workers, with suppliers, machinery malfunctioning, and so on.

VIVE: You impress me as the more modern style of businessman, rather than the family oriented style of management.

REITZLE: I think that today there are so many companies working in this same way, it is the modern way of doing business.

VIVE: So you went to Harvard and when you returned, they were about to launch the next generation of Seven Series but you told them it wasn't the way to go.

REITZLE: Yes, but it didn't quite happen that way. One day our board member responsible for Research and Development suddenly and unexpectedly left the company and Mr. Von Kuenheim took over his portfolio as well as maintaining his own responsibilities for Research and Development. But as he was already working 12 to 14 hours, already he needed some support and so one Friday evening I was told that I had to attend a meeting on Monday morning which would begin my new duties as head of Research and Development, so I had one hour on the Monday, before the meeting, to tell my managers and staff that I was leaving the production area.

It was 1983 and in R & D I became totally involved in the product design and it was very stimulating for me as an engineer to be actually involved in the design of the cars. Then we got a new R & D Board member a few months later and that was when I left to go to Harvard, which had always been an intention of mine anyway. But by then I had obtained my Doctorate in Engineering and a second Degree in Business Administration and I thought it would be unwise to take out a third degree before getting a practical education. Because I had arrived at a transition period in my career, I took the opportunity to study at Harvard, and on my return I took over the whole manufacturing department, which included my own workshop, where I had first started at BMW.

But his only lasted a year because the new R & D Board member focused on Research so I came in and took over Development and, later when he left, I took over the whole area and that's the story.

Getting back to that new Seven Series, I realised, within a few weeks of being in charge of R & D, that the design of the new Seven Series BMW wasn't the car that I thought we needed at the time. I made proposals to change the car dramatically.

VIVE: This must have been the turning point for BMW. You came from a background where you saw every nut and bolt, every manufacturing technique, and you were in a position which was the dream of every engineer, in charge of R & D. The first thing you could have done is say 'let's do what everyone wants' or you could have made a difference, you obviously chose the latter.

REITZLE: When I worked in manufacturing, I lived with these cars and I knew them and, of course, I had my own opinions about these cars. I always thought abut car design; for example, years ago I proposed a small BMW city car, and now I had an opportunity to take my ideas further. When I saw the new Seven the car was, almost 50% done in 1983. Now normally you can't make drastic changes to a design when it is so far advanced but we said we had to do it; and I wasn't alone in this thinking, there were other engineers who also considered that the car wasn't right at that stage.

VIVE: When you look at the car industry; BMW was doing something but it wasn't the right thing. Somehow you put your finger on that something; Why?

REITZLE: To try and answer this I have to explain that when I came to the R & D Department there was much discussion both in the German car industry and in the newspapers with journalists writing critically about the role of BMW and its need, the expectations on it to produce more than 'face-lifted' cars. So there was a lacking between the expectations of the people and what BMW was providing. This was the environment I came into and when I saw the Seven Series BMW I realised that it would not be able to compete successfully in its class.
It was a nice car but not sufficient to be accepted at the top level, so I made proposals for changes and Mr. Von Kuenheim made the decisions. At this point of time we considered it might be worthwhile to make innovations in the Three Series, which up to this point consisted of the two door model and a recently developed four door model. So we introduced a convertible, then we developed a four wheel drive.

So, in changing the Seven, we made changes in the Three Series and then we also had to decide on the design of the new Five Series. there was short term, medium term and long term focus.

VIVE: This era altered the history of the car industry; it pushed BMW to the forefront of the world's automotive industry.

REITZLE: BMW with roughly 500,000 cars is comparatively small in world auto terms, so in the top end one has to think of how to compete. We can't compete by just producing cars. I often compare us to the watch industry. Rolex, for instance, produce a piece of engineering that tells the time, but a fifty dollar Seiko can do just as good a functional job. However, people like nice products and if you offer more than just a collection of interesting technology, if you fulfill the expectations of the customers, who have beautiful houses and perhaps collect old furniture or modern art who look for aesthetic qualities, why not give them a car that fits these qualities? If you want to be successful in this business you have to have your own character.

VIVE: In Australia, we see the German car industry, the French, the Italian and of course the English car business. The German industry is seen to make very good cars, practical cars but cars that perhaps have traditionally lacked in an aesthetic mentality. So when you took this direction you must have been aware that your cars are not just cars. What were you thinking at the time?

REITZLE: I think we only did what people at the time expected from BMW. I think the emotional potential of BMW is tremendous. The core of our company's image is always technology, 'sportiness'; it has always been that we have been smaller than others thus have been forced to run quicker than others. In the earlier years we never had much money so we had to focus on efficiency.

People expect a fresher product from us so you have to fulfill those expectations in terms of design, innovation, freshness, style and so on. In the past this company believed that form followed function but now it seems that form is right alongside function. People want something awesome to look at, something they can be a part of, not just machinery. They want luxury.

VIVE: There must have been a grand plan at that time when the new Seven was introduced. What was your strategy?

REITZLE: It was simple. We had our old Three Series, Five Series and Seven Series. Then we introduced a new Three Series which was a minor step but was a big success and showed the decision of the company to be right. Then we refined it a bit more. We did the same with the Five Series. With the Seven we have been nearer to the Five than to the S Class. And next we said this car has to escalate in value and in styling. It had to make a statement.

First we started with the Seven and then we made the Five. If you compare the new Five with the old Five the difference is dramatic, and the look of the new Three Series is even more markedly different than the old series. So in this way we altered the image of the cars.

We took the whole range to a higher level, and introduced the range of Series, so people could now say 'I can afford the technology of the Seven at a lower price' and now we're doing the same with the Three, which will give the Three Series a boost.

VIVE: Given the price of your cars, especially the Three Series, which compares favourably with the Japanese cars, is it your intention to compete at that level of the market?

REITZLE: We have to pay attention to this end of the market, the entrance area, because if we are not strong here eventually we lose the top end as well.

It may even make sense to have an attractive cheaper model to have a solid entrance barrier. It is easier to be attacked in the volume area because when you go up into the higher price market the pyramid is too small and you end up in a very narrow position. On the other hand if you fight further down and make the base very solid you can fill the rest of the pyramid. This is essentially our strategy, and this is the problem with certain other luxury marques who only operate at the tope end of the scale.

You need a certain level of production to enable the right sized R & D Department, the right distribution network for dealers; if you sell worldwide you need a minimum critical mass below which you can't possibly operate. We've found that below 400,000 units it would become very difficult to afford these facilities and to be really competitive for the future. Having struggled to overcome this limit we are now in a slightly more comfortable situation with 600,000 cars and we really can afford to keep the business going in sales, in production and in R & D. So that was the strategy - better value price for the customer and the kind of high class products which people expect from a company like BMW.

Coming from manufacturing was an advantage in that I knew how to design the car and that it could be produced efficiently in the plant.

VIVE: The research centre here is indeed impressive, but why give it so much emphasis; why have such an incredible facility?

REITZLE: That's the platform I believe you need to be highly competitive. You see, we have to be efficient in R & D, especially in development time and we have caught up to the Japanese in terms of development time with this facility.

Additionally, we have shortened the launch time for our cars. Within the last five years, every year has seen the launch of a new model whereas in earlier times we had a delay of between two to three years for a new model. So in effect we launched a product offensive and this was also part of our new strategy.

We established a new engineering system from the R & D through to the work flow. That I think is the secret behind this new centre and to introduce this, you need a facility that can get all our engineers together - they were strewn all over the place. Because the company had such a dramatic growth, we weren't able to centralise it - renting premises here, there, and it was a disadvantage. We needed this new facility for our engineers and then we decided that it wasn't sufficient - we needed to do more. This is now the building which supports the new ideas in developing cars.

VIVE: Do you think that it is a problem being an engineer and running the company?

REITZLE: It depends very much on the individual. If you are simply thinking as an engineer then it is not possible to run a highly diversified company like certain automobile companies have become. A lot of big German companies especially technology driven companies are run by engineers so I think that there is absolutely no strict rule that engineers can't run companies. You see huge companies in America which are run also by engineers. It is a matter of the people.

VIVE: Do you think that there is an advantage in being in the car business in Germany?

REITZLE: Firstly, there is the tradition which permeates almost everything in Germany, and secondly, the experience of the people we have: the high class of people that we have built up who support the infrastructure. Also, we can't find in the United States for example the same class of supply company - we tried to buy much more from the US but we can't seem to get the quality and reliability of the components in the areas that we require. I think that it is improving but only a few companies are able to do this and we have great difficulties. so when I compare it with Europe, especially Germany, I can see the strength of Germany. Then there is the education of our people, especially of our Meister or foremen, which I think is unique. It is such a solid base because they are so highly skilled that they are the strength of the German industry and the German economy not just the car business.

VIVE: What have been the differences in your philosophy now compared to even fifteen years ago in terms of marketing your car as a 'luxury marque' and the way in which you position BMW above and beyond the technical and mechanical improvements?

REITZLE: I think that all the people in this company who are responsible for the major decisions have the same philosophy in mind - that we have to be more of a luxury company as well as just being a car company. Accordingly, all of the decisions that we make support this overall goal. In the refinement of the cars, just like a superior watch, all the details have been tested and made perfectly. Therefore, the corporate identity of the whole company has to support this. When you see the Cartier shops around the world, there is that distinctive red colour and all the shops worldwide follow a universal strategy. If you look at Rolex, they do it in the same successful way. There are certain rules in the luxury business which are different from normal business and sometimes it works just the opposite to when people think that if they make the product cheaper and cheaper, they will naturally sell more and more - the rule of the mass producers. The reverse rules apply to customers who are different to the standard customer, and today the wealthier the people, the more they can afford, the more rewarding they are to themselves. It therefore becomes tougher to fulfill these high expectations. You are then only good only if you can anticipate the requirements when you create a market rather than trying to pick up a share of a market.

VIVE: Now, with the heavy emphasis on, and public awareness in petrol and environmental issues such as smoke emissions and the use of synthetic materials in cars that can be recycled, then on a more commercial level the Japanese who are upping their presence in the luxury car market, what is it like sitting in your chair with these sort of pressures?

REITZLE: For the first three of the four topics you have mentioned I will give you one answer: we must pay a lot of attention to the social acceptance of the Car. Especially in Germany where the Greens attack the car as the ultimate polluter. The nuclear power plants were the big issues here and Germany was ahead in the development of research in nuclear power plants and politically it is not possible to establish new power plants but I think that it is a mistake because in the long run, we will need them. The biggest problem in the next 20-30 years will be population and we have lost I think 20 years, that is my personal opinion. We have to make the technology and therefore we have to spend more money on research to make nuclear power plant technology easier, safer, etc.

As a car industry we must be concerned that something is happening with energy because there will not be enough energy for the burgeoning populations. We must bring down consumption and that is what I mean by social acceptance - these issues are priority number one in the development of new cars.
Sure, they should be elegant and refined but they must also be efficient. They have to be made out of recyclable material and we must establish these processes. We must really spend more money than before on the car to produce it in a way that will be compatible with the environment.

As for the Japanese competition, all I can say is that they really are very, very efficient; they are tough and they are, I think, playing a different game with different rules. They do not compete in the way that we are used to - we have had a very tough competition in the last 20-30 years with Mercedes Benz but we can both live together - we concede it is possible. But the Japanese have a different approach - they want to dominate the world economy, the world market; they have these different goals and therefore we must pay attention because we have other prerequisites here in terms of employee relations. Our people expect more than just working and working and working until they retire. In Japan, I assume there will begin to be change in that way of thinking too because people there are starting to travel around the world and they see that people are living differently in other areas.

As for the US, it astonishes me that they will often buy the Japanese product even when the US equivalent is the same quality. It is the better image, better marketing that the Japanese have built up and with the money the Japanese get from the US, they buy their land and their companies. The big movie and entertainment business is now owned by the Japanese and I think that they will therefore have the power to influence the consumer in terms of product placement of their cars in the movies. Buying into the infrastructure of communications gives one tremendous power more so than buying up real estate or the big insurance companies and pension funds.

We try to anticipate this but it is an open world, and I am absolutely for free trade nonetheless we must pay attention to all of this.

VIVE: Don't you think that people could say the same about the German industry to a degree? You could say that the Germans have also gone out there buying...

REITZLE: Perhaps, but is only a very small percentage compared to the Japanese buying power. O.K., we did it twenty years before, we bought some companies outside but there were few if any big US companies bought by the Germans. What happens is that their own plants are established in Germany. Ford and General Motors have had their car plants for over forty years here so for them it is not necessary to export their products to Europe but this is not so in Japan. And that is very often overlooked. In past years the US shipped more products to the EEC than the vice versa. It has changed since, we have a surplus from the EEC - not too much - but we have, but it is only a percentage of what the Japanese ship to the US. When the US compares the balance of trade between the EEC - most particularly Germany and the US - they say they ship too many products to us. But they overlook the fact that the US companies have a lot of subsidiaries here: IBM, OPAL, FORD, ITT... they bought a lot of the German supply industry. So it is not necessary for them to ship the actual cars here.

The same is not so with Japan and the US. There are no US subsidiaries in Japan apart perhaps from IBM or on a very small scale.

VIVE: What do you perceive as the future for Wolfgang Reitzle?

REITZLE: (smiling) Well, I am currently at JAGUAR and I will try to design new cars.