Karl and Gottlieb were born in Germany and had a common interest in building something special. In their younger ages, both were working on machines. In 1886, the first motorize tricycle was created by Karl Benz while Daimler collaborated with William Steinway to create horseless carriages in America. During this time, Daimler founded DMG and Karl Benz established Benz and Cie. In 1900, DMG launched Mercedes which served as a stepping stone in the Mercedes-Benz's history. This was soon after the war had began in Germany, hence, there was inadequate fuel for vehicles as high taxes made the car production challenging.
Karl Benz decided to ask for assistance from DMG but was rejected at first. When conditions worsened, DMG was forced to write an agreement of mutual understanding with Karl Benz while preserving their individual identities. In 1926, however, the companies combined to create the Daimler-Benz company. The first Mercedes-Benz car was introduced about a year later.
In 1927, the merger had already been successful as the production of Mercedes-Benz automobiles had risen to 7,000. In 1930s, Mercedes-Benz W15, known to be the largest and most famous, made its debut. This resulted in Mercedes-Benz becoming one of the top brands in the automotive industry. Hence, Mercedes-Benz was built as a Daimler-Benz AG's separate division.