The phantom pains of Saxony

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Auto Union - an industrial champion of the past © CC BY 2.0

The ambitious merger of four companies spawned an industrial champion. The car company’s premium brand soon dominated the domestic luxury car market with a whopping 50 percent market share, while its booming motorcycle division was the largest in the world.

Almost ninety years on, few people remember Auto-Union - the Volkswagen Group of its time. And Chemnitz, where the company was based, is now better known for rock-bottom rents and a vibrant neo-Nazi scene than for its heritage as an automotive hub.

The story of Auto-Union is exemplary of the decline of eastern Germany.

Before the Second World War, more than half of Germany’s 100 largest companies were oriental of the Elbe. Berlin was home to industrial giants such as Siemens and AEG; Saxony was the Bavaria of its day - the nation’s industrial powerhouse.

Today only one east German company is among the country’s 100 largest: VNG-Verbundnetz Gas AG in Leipzig.