Gustav Otto - The Foundation of BFW

The Foundation of BFW

In 1913, after selling 47 aircraft to the Bavarian Army, Gustav opens his factory Otto-Flugzeugwerke on Lerchenauer Strasse just east of the Oberwiesenfeld troop maneuver area in the Milbertshofen district of Munich(this area later became Munich's first airport). He wanted to be closer to the German government's procurement process for military sale. However, Gustav was not skilled at the politics and payoffs associated necessary when dealing with the Bavarian war ministry and Prussian Army. Unable to navigate these politics without leaving his pride and integrity intact deeply troubled Gustav.

Shortly after 1914, Otto established another company named AGO Flugzeugwerke at Berlin's Johannisthal Air Field. The initials AGO stood for either Actien-Gesellschaft Otto or Aerowerke Gustav Otto– there seems to be some ambiguity– but the company mostly license-built Otto Flugmaschinenfabrik designs,(as did Pfalz Flugzeugwerke) during the early years of World War I. The designs by Gustav Otto were initially successful, but Otto was continually experiencing problems related to cost-effective production, as well as generating profits. At the start of the war, Otto-Flugzeugwerke was supplying the German Air Force, but the production problems ended up being so great that the government agencies urged the company to solve the issues. The stress of wartime seemed to prove too great a burden for Gustov who suffered health issues which led to financial problems with the company. In 1915 he was admitted to a Munich mental hospital for treatment of clinical depression (as it is called today). As he was being treated, the company languished to the edge of bankruptcy. Eventually, Otto was forced to resign from the business and was offered a buyout that would compensate him for the business as well as his medical bills. The assets were finally taken over by a consortium which incorporated them into Bayerische Flugzeugwerke on 19 February 1916. Gustav Otto no longer had a stake in this company. He turned his attention instead to Otto-Werke Flugzeug- und Maschinenfabrik GmbH, which was founded on 1 February 1916, just before Otto-Flugzeugwerke was taken over by the consortium. This new company was not in any way connected with the newly established company.

After the First World War, Otto started a new attempt within the automobile manufacturing area with the Starnberger Automobilwerke. The luxury "Otto-Mercedes" car built there is alleged to have been well received abroad. During this time, he was divorced from his wife Ada in 1924, an event under which Otto suffered badly. Ada remarried, but in August 1925 died in mysterious circumstances that gave rise to much speculation. Despite the fact he was no longer married to her, Otto took her death most harshly and apparently fell into a deep depression.

In 1926, amid failed attempts at business (caused by various reasons), the death of his wife, and health issues, Otto committed suicide at the age of 43.