Allied Companies: Investments in Axis Countries and the Soviet Union

German motor vehicles
Figure 1.--A major weakness of the German Wehrmacht in preparing for World War II was that it was not fully mechanized. And it did not have an overall industrial capacity or a vehicle production capability comparable to the countries it would have to fight. The American automobile conpanies (especially Ford and GM) played a major role before the War in increasing Germany's vehicle production capacity. Ford would also play an important role in expanding vehicle production of the Soviet Union.

American investments in Europe were relatitively limited before World War I. The War significantly weakened the economy of the belligerant countries. Unlike World War II, Germany or most of Frasnce was not occupied and there were no significant strategic bombing campaign. Even so, the economic damage was significant and this created opportunities for American companies to commit badly needed capital as well as profitably utlize its technology. The Americam investments ptovided a boosdt to the badly weakened European countries. Companies like Ford workded out deals with the Soviet Union (which was at first a NAZI ally). Invesments were also made in Italy. Several American companies were involved in Germany. This activirty began during the Weimar years which mean that the investments were in place when the NAZI seized control. They managed to continue to operate during the NAZI years which eventually caused conflict with the U.S. Government after Hitler launched World War II. American industry of course played a major role in winning World War II. Several of the compasnies involved were at first conflicted, seeking to protect their assetts and operations in Germany and other Axis countries.

Investing Countries

Extensive information is available on American countries investing in Axis countries. Anmerica was not, however, the only country making such investments. As a result of World War I. America was the major country making such investments. The other major countries (Britain, France, and Germany) hadf their finances so damaged by the War that they had to liquidate many overseas investments. There were American companies in Britain at the time. Also were British subsidaries operating in Germany at that time. Germany lost its colonies and many investments in beligerant cuntries, such as Beyer operations in America. It still had some operations in Britain, we think mostly chemical companies.

Chronology

American investments in Europe were relatitively limited before World War I. The War significantly weakened the economy of the belligerant countries. Unlike World War II, Germany or most of Frasnce was not occupied and there were no significant strategic bombing campaign. Even so, the economic damage was significant and this created opportunities for American companies to commit badly needed capital as well as profitably utlize its technology. The Americam investments ptovided a boosdt to the badly weakened European countries. Companieslike Ford workded out deals with the Soviet Union (which was at first a NAZI ally). Invesments were also made in Italy. The major U.S. automobile manufacturers established multinational operations setting up subsudiuaries in the 1920s and 30s. They located plants in Germany, eastern Europe, and Japan. Several American companies were involved in Germany. This activirty began during the Weimar years which mean that the investments were in place when the NAZI seized control. They managed to continue to operate during the NAZI years which eventually caused conflict with the U.S. Government after Hitler launched World War II. American industry of course played a major role in winning World War II. Several of the compasnies involved were at first conflicted, seeking to protect their assetts and operations in Germany and other Axis countries. After the War, Federal procecutors charged the General Electric Company with monopolistic practices. What made this case sensatioinal was that GE was accused of criminal conspiracy with Krupp--the massive German arms firm which had polayed a major role in arming the NAZI military. Some onservers charge, " heir partnership artificially raised the cost of U.S. defense preparations while helping to subsidize Hitler’s rearmament of Germany. The arrangement continued even after Nazi tanks smashed into Poland." [Gilmore]

Countries

American companies had substantial investments in Axis countries. The most important were in Germany which after World War I despeately needed capital and was the infustrial center of Europe. American corporations investing in Germany included: DuPont, Ford, General Electric, General Motors, Internsationsal Busines Machine, Kodak, and Shell Oil. GM (Opel) and Ford controlled 70 percent of the German automotive market when Hitler launched the War (1939). Both companies retooled their plants to produce equipment for the German war effort. As the War was to be a mechanzed struggle, their efforts were of some importance. Luckily for the Allies, the German automotive industry was much smaller than the American industry. Even so, the contribution of American automobile companies to the NAZI war effort was significant. A Congressiional investigation found, "The outbreak of war in September 1939 resulted inevitably in the full conversion by GM and Ford of their Axis plants to the production of military aircraft and trucks. [U.S. Senate Judiciary Committee, 1974] One of the weaknesses of the Wehrmacht was the limited mechanization and inadequate supply capability. The trucks built and track vehicles built at the American subsiduaries played an important role in strenthening the mechanized capability of the Wehrmacht. GM and Ford subsidiaries in the Reich built nearly 90 percent of the armored ‘mule’ 3-ton half-trucks and more than 70 percent of the Reich’s medium and heavy-duty trucks. These vehicles according to American intelligence reports, served as 'the backbone of the German Army transportation system'.

Corporations

Quite a number of important American corporations made investments in Europe after World War I. This included the the countries that would be major World War II beligerants, especially Britain, Germany, the Soviet Union, and other nations. These companies thus at the time of World War II had investments and subsidiasries in Axis countries (Fascist Italy and NAZI Germany) and the Soviet Union. The invests were not made during the NAZI era. Rather American companies had investments in Germany at the time that Hitler and the NAZIs seized power and thus gaianed control over them. The companies had no choice, but to follow the national legal system. Of course we now know how evil the NAZIs were. Company officials did not have our benefit of hindsight. Of course after Ktistallnavhr (Nobember 1938), the nature of the NAZI regime was increasingly clear and the comapnies involved can be ctiticized for continuing to conduct business in what was an inceasinglu lawless regime. The major compaies included Ford, General Electric, General Motors, International Business Machine, and others. The investments of Ford and General Motors were especially important because they significantly expanded Germany's capacity to build motor vehicles.

Left-Wing Assessments

One of the fascinating benefits of the internet is the ability to exchange ideas and information with people all over the world. This has resulted in adung importabt information and insights for our web pages. It alo has served to reveal attitudes and mis conceptions. And in this regard we have noted a string propensity among Russind and left-wing voices in the est to diminih the role of the Western Allies in defeating the Axis. Now we do not man to disniss in any was the enormity of the Soviet contrinution to smashing the Whermacht ad NAZI regime. What we note, however, is a tendncy to not only to dismiss the Allied role, but to actually claim that the Western Allies wre in keague with the NAZIs. This was a part of Soviet propaganda during the Cold War, but we note it continues in modern Russia and among left-wing commentators in the West. One blogger, for example tells us, "Have you made some research into Western financing of Nazis? Switzerland wasn't occupied primarily because it was source of laundering such money from Western financiers. Do some research into that." [Pazzo] Actually we have looked into both issues, pre-War activities of American companies in Germany (mostly investments made before the NAZIs seuzed power) as well Swiss money laundering. The Swiss were certainly involved, but we have found no evidence of a wuder conspiracy among Western financeers. While individuls like Pazzo are quick to raise charges about America and Britain, they do not want to talk about the Soviet alliance with NAZI-Germany and the enormous Soviet support for the NAZI war effort.

Sources

Dobbs, Michael.

Gilmore, Prter. "Nasty Nazi Business: Corporate deals with Nazi Germany," UE News (December 2000). UE NEWS Managing Editor Peter Gilmore, with research and consultation by UE Research Dir. Lisa Frank and UE Archivist David Rosenberg. Much of the article, however, is based on the reportage of retired UE NEWS Managing Editor James Lerner, who covered the GE-Krupp conspiracy trial.

Snell, Bradford.

Urwand, Ben. The Collaboration: Hollywood's Pact with Hitler.

New York Times various issues.

U.S. Senate Judiciary Committee. (1974).








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Created: 3:07 AM 9/7/2009
Last updated: 6:52 AM 8/7/2019