I found this very interesting article about BMW's history that claims:
Quote:
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Bavarian Motor Works, was established in 1916, producing first engines for aircraft and then for motorcycles. It moved into automobiles in the 1920s, assembling for the German market small British cars under license. BMW began to manufacture cars of its own design in the 1930s
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click here for the full article
It's an excellent article that provides a good overview of BMW's cars of the past.
Enjoy.