Things did not look good. Indeed, BMW was rapidly approaching its final collapse and demise in the 1950s: While motorcycle production had reached a new record in 1952, production figures decreased significantly in the years to come than they had increased in the late '40s.
To offset this dismal end of the motorcycle market, BMW built the prototype of a new small car in 1950, taking up the lines of the pre-war BMW 327 and the 600cc flat-twin engine so popular at the time. But the project was subsequently discarded for economic reasons.
After launching the Isetta under licence in 1954, BMW soon realized this bubble car was too small for new customers entering the market who, as a result of the German "economic miracle", soon expected more of their new car in the late '50s. Quite simply, such spartan super-minis had already passed their peak, with customers demanding a longer wheelbase and more comfort.
At the same time, the automotive industry was booming, with production in West Germany increasing by one-third in 1955 alone. Introducing new models, BMW sought to jump on the bandwagon with the BMW 600 in 1957, a somewhat longer Isetta with its flat-twin engine fitted in the rear, intended to meet demand for a genuine four-seater at least for a while. But again, the BMW 600 turned out to be a flop, customers not accepting the concept with the door at the front of the car.
Looking hard for a solution, the Development Division initially attempted to build a conventional small car. For economic reasons it would use as many parts from the BMW 600 as possible. The wheelbase was extended to 74.8" by adding extra sections front and rear, and the front seats were moved back to provide convenient access to the car from behind the wheel arches. But soon it became evident that without a further extension of the car's wheelbase, space for the rear seats would be very limited. At the same time, the rapid increase in weight resulting from the longer wheelbase was another problem, together with the poor seating arrangement.
The attempt to modify the 600's frame and structure to meet modern demands proved to be impossible - or at least subject to significant compromises. So instead, BMW decided to find a more promising solution by re-configuring the entire design and structure of the body.
However, BMW's engineers did not want to completely give up the proven parts and components of the 600 in developing their new model. So they decided to modify the front axle of the 600 with its longitudinal swing arms for consistent track and wheel camber, carrying it over to BMW's new small car, with appropriate reinforcements, to meet the greater demands of the new model.
The engineers also carried over the rear suspension which, with its swing arms modified to a slightly higher angle, supported the car's steering as a function of acceleration in bends, counteracting any tendency to oversteer.
Further features carried over from the BMW 600 were the all-synchromesh four-speed transmission as well as the bevel gear differential - and, of course, the flat-twin power unit originally used on BMW motorcycles and now increased in from 600 to 700cc. The crucial point was to wrap this technology in an appropriate body suitable both for the market and the requirements of the future. Back in late 1957, before the BMW 600entered the market, BMW's new Board of Management had already requested the Development Division to develop and build a conventional small car with progressive design in corporation with an Italian designer and coachbuilder.
In July 1958 Wolfgang Denzel, an automotive engineer himself and BMW's importer in Vienna, proudly presented his new model designed by Michelotti in Starnberg near Munich. The decision to adopt this concept was then taken in October 1958, allowing BMW to create both a production Coup and a Sedan as an in-house development. The reason for doing this in-house was that the prototype, while being very attractive and offering excellent driving qualities, would have been uneconomical in production due to the expensive tooling required. So working hard on all the details, BMW's designers developed a dynamic little car which had nothing do to with BMW's design to date: the BMW 700.
In its design, the BMW 700 followed a trapezoid line with the roof structure and the basic body of the car to form two counter-flowing bodies. This design concept came from the USA as a streamlined rendition of the former pontoon structure, with further refinement by Italian car designers.
Under the guidance of Wilhelm Hofmeister, BMW's designers then turned this draft into two models, a two-door Saloon and a Coup. Apart from its brand-new design, the BMW 700 offered another surprising highlight: it was the first BMW with a monocoque body. And the reason for introducing this new technology was clear: "The monocoque floorpan was able to save about 30kg in weight, lower the entire car by 2.4-2.8" and streamline the production process, with appropriate cost benefits."
BMW was not a newcomer to the use of monocoque unitary body panels. The BMW 326 built in Eisenach from 1936 until the beginning of the War already featured a floorpan made of high-rising panel supports firmly welded to the body of the car - at the time the best solution for a load-bearing body structure.
This experience quickly paid off, a comparison with two other well-known cars of the same size built in Europe and with a monocoque body clearly confirming the superior stiffness of BMW's car structure.
On 9 June 1959 BMW's Board of Management under their Chief Executive Dr Heinrich Richter-Brohm made the big move, presenting the new BMW 700 Coup, the first model in the new series, to some 100 international motoring journalists. This was in Feldafing near Munich, at the same place where about two years before they had first seen the not-so-fortunate BMW 600.
Since the turbulence encountered by BMW's previous model range had produced critical reports by the press, Helmut Werner Bnsch, BMW's Director of Technical Sales Planning, admitted quite frankly in his welcoming statement that "ultimately it was this attitude and these doubts which convinced us to invite you here today to experience the new BMW 700 Coup, and not to wait until the Frankfurt Motor Show." When Bnsch revealed the new Coup, everybody started clapping. The journalists admired the new model.
The BMW 700 had grown out of the small car class still prevailing in the market and allowed provided extra space. The designers and engineers were particularly proud of the car's lightweight technology reducing dry weight to less than 1323 lb, despite the car's overall length of 139.4", thus providing the qualities required for good acceleration and hill-climbing performance.
Compared to the BMW 600, the extension in wheelbase by 25% came with an increase in weight by only 14.5%. And despite its low height of just 50", the Coup offered acceptable headroom, as the doors measuring 36.6" in width allowed unusually comfortable access for this class.
Enjoying the seats, the driver and passengers in the BMW 700 benefited from an unusually good balance of useful interior space and exterior dimensions, the curved windows helping to keep the doors smooth and provide extra width inside the car. Again in the words of Helmut Werner Bnsch: "In combining the footwells and the luggage compartment, we followed the example of a modern sleeping car - which shows that sometimes you can even learn from the railways!" He then added that "we also remembered to keep the four corners of the car in clear sight from the driver's seat, allowing the driver to easily maneuver into tight parking spaces."
Appropriately contoured to fit the human body, the front seats, with their active-breathing upholstery, were adjustable even while driving and came with backrests moving to four different angles. The backrest in the rear folded down whenever required like in the BMW 600, allowing the driver and passengers to take bulky objects such as all their camping gear.
The BMW 700 was well-equipped for traveling with a fair amount of luggage. The front luggage compartment, with its conveniently flat floor, was able to accommodate two standard-sized suitcases measuring 27.5" in length, together with some smaller bags. The fuel tank was beneath the luggage compartment, perfectly protected by the spare wheel standing upright in front. Offering a capacity of 6.6 imp gallons plus three liters reserve, the tank was sufficient for a cruising range of more than 300 miles since, according to the fuel consumption standards applicable at the time, the BMW 700 was quite happy to return approximately 47mpg imp.
Developing maximum output of 30hp at 5000rpm, the two-cylinder power unit was able to accelerate the Coup to a top speed of 78mph. Exactly what this meant in terms of performance became quite clear in a statement again made by Helmut Werner Bnsch, comparing the car's performance with that of the legendary BMW 327 touring sports car: "The BMW 700 Coup with its 700cc 30hp two-cylinder offers the same top speed, the same acceleration and the same safe average speed on the road as its legendary predecessor with its two-liter six-cylinder two-carburetor power unit. And it does so with the same space inside and with superior roadholding of an even higher standard."
Journalists driving the BMW 700 Coup were thrilled from the start, waxing lyrical about the car's design and its driving qualities: "Acceleration is certainly impressive for a car of this size, taking you from a standstill to 90 km/h in 20 and to 100 km/h in 30 seconds." With this kind of performance, some journalists realized from the start that the BMW 700 Coup was already looking at a sporting career: "You have the feeling that you're sitting in a car with genuine sporting values, but without the rather harsh ride and limited space typical of most sports cars."
Ultimately, most of the testers confirmed the optimism expressed by BMW's Board of Management: "The BMW 700 Coup is the latest model from Bayerische Motoren Werke and promises to be a great success and a real highlight at this year's Frankfurt Motor Show."
This is precisely what happened, the BMW 700 became a genuine highlight in Frankfurt. The new Coup was presented on the BMW booth at the 1959 Frankfurt Show at a price of DM 5300, including the car's heater. Right next to it was the four-seater Saloon based on the same engineering and design concept and destined to enter series production in early 1960.
Retailing at a price of DM 4760, the Saloon was almost DM 600 cheaper than the Coup with its higher level of equipment. At the same time, the Saloon boasted a far more spacious body offering adequate space for four adults. And unlike the Coup with its flair almost reminiscent of a sports car, the Saloon stood out in particular through its practical features and benefits.
Likewise designed by Torino coachbuilder Giovanni Michelotti, the Saloon also received its finishing touches in BMW's Design Office under Wilhelm Hofmeister. With its steeper windscreen and rear window as well as the modified roof, the Saloon, on a body otherwise identical, looked much larger than the dynamic Coup. But weighing just 10kg more than the Coup, 1411 lb Saloon was able to offer almost the same good performance, accelerating to 100 km/h in approximately 30 seconds and reaching a top speed of 75mph.
With the Frankfurt Motor Show hardly over, BMW struck a very positive balance towards the end of September: "Both new models were warmly welcomed by motoring journalists and the public alike. As a result, it sold in unusually large numbers not only in Germany, but in all its export markets.
The BMW 700 was a direct competitor for the initially cheaper VW Beetle and appealed to the motorist wishing to stand out from the crowd. Indeed, as a result of great demand customers had to wait several months for the delivery of their car, with BMW selling more than 35000 units in 1960, the BMW 700 thus accounting for some 58% of the company's overall revenues.
The sporting qualities of the BMW 700 Coup were evident from the start of production in July 1959: The first Coups were to be admired on the track before the end of the year, on the Sahara-Lappland Rally, for example. In 1960 BMW's fast Coups brought home both gold medals and titles, with Hans Stuck clinching the German Hill-Climbing Championship at the wheel of a BMW 700 at the age of 60.
This created significant demand among many customers for an even more powerful engine, with the big day coming in summer 1961 when BMW proudly presented the BMW 700 Sport to the press at the Nrburgring race track.
With its compression ratio increased to 9:1, an even more dynamic camshaft and Solex twin-carburetors, the two-cylinder boxer engine now developed 40hp at 5700rpm. This sporting package was rounded off by an optional sports transmission and an even harder suspension, featuring firmer dampers and an anti-roll torsion bar. The power unit, in turn, was sufficient for acceleration to 100 km/h in just under 20 seconds and a top speed of 84mph. All the customer had to pay for this extra driving pleasure was DM 550.
This "hot" version of the BMW 700 quickly became a legend in the early '60s, particularly in motorsport, and was lauded by fans as the "little fighter". And indeed, at its time the car put up some exciting duels against competitors from both Steyr-Puch and Abarth.
Moving on to works racing, BMW prepared two truly outstanding performers in parallel to one another: the 700 GT in 1960 and, a year later, the BMW 700 RS. "When a new BMW sports car, the BMW 700 RS, enters the Rossfeld Hillclimb Race on 18 June 1961, this will be in a quest to test the driving qualities of the BMW 700 at higher speeds and under more dynamic conditions," said the announcement.
The fact that this was indeed no more than a test is obvious, considering the BMW 700 RS, in making its debut in the sports car category up to 1600cc, was competing against the likes of the Porsche Spyder and the Porsche RSK, to mention only two formidable rivals.
BMW's small racing machine boasted a tubular spaceframe and aluminum body, with 70hp coming from the side-shaft power unit and with the complete vehicle weighing less than 1323 lb. Depending on the transmission ratio, this small but dynamic performer was able to reach a top speed between 93 and 124mph - enough for Walter Schneider to bring home the German Circuit Championship in 1961 at the wheel of a BMW 700 RS.
The dynamic BMW 700 remained seriously competitive and in most cases superior for years to come, boasting various levels of tuning and engine power. And when BMW's two-cylinder sports car finally reached the end of its career, Hubert Hahne, one of the big stars at the time in touring car racing, had brought home the majority of his wins in this outstanding performance model.
At the same time the BMW 700 had already become the ideal car for young drivers making their first appearance in racing at the time. A very good example is Hans-Joachim Stuck, who has great memories of this great car: "I was just 9 years old when I accompanied my father to drivers' courses held by Scuderia Hanseat at the Nrburgring. There I was able to drive a BMW 700 myself, since it was a closed circuit reserved entirely for our racing activities."
BMW quickly added further versions to the range, making the BMW 700 even more successful: Following the regular 700, the company introduced the BMW 700 De Luxe in February 1961, featuring the same technical equipment but with an even higher level of appointments. The most exclusive model in the BMW 700 range launched at the same time was the BMW 700 Convertible, the Baur Coachbuilding Company in Stuttgart designing and building this open-air version of the BMW 700, as they had already done so often in the history of BMW.
To provide all the qualities for driving in the open air, Baur reinforced the car's load-bearing elements and re-designed the rear end. An uncomplicated, straightforward roof mechanism made open air motoring a genuine pleasure, particularly because the 700 Convertible came as standard with the more powerful engine otherwise featured in the BMW 700 Sport.
The most significant change came in spring 1962 when BMW, while retaining the car's wheelbase, extended the body by no less than 12.6" to offer a significant increase in motoring comfort. This new model was marketed as the BMW LS and the BMW LS De Luxe.
As of autumn 1964, the Coup also received this longer body, coming off the assembly line in its last year of production as the BMW LS Coup. In all, sales of the BMW 700 amounted to 190,000 units by the year 1965. And the car was a great success in many countries the world over, with BMW delivering assembly kits for the BMW 700 to assembly plants in countries otherwise imposing high taxes on completely built-up cars. Hence, the BMW 700 was assembled from kits in Belgium, Italy, Argentina and even - in small numbers - in Israel.
At the end of the day the BMW 700 more than fulfilled its expectations, having given BMW new hope and taking the company successfully through the crisis in 1959 and on to the final breakthrough to profitable large-scale production.