Benz significantly improved his engine design, creating a more powerful and efficient single-cylinder two-stroke engine that would become the heart of his automotive experiments.

Benz founded a new company, Benz & Co., with partners, to finance his automotive endeavors. This partnership provided the financial backing necessary to focus fully on designing and building a motorcar.

Benz designed and built the first practical gasoline-powered automobile, the Benz Patent-Motorwagen. This three-wheeled vehicle was powered by his single-cylinder engine and featured groundbreaking innovations.

Benz received a patent (DRP 37435) for his Motorwagen, officially recognizing him as the inventor of the automobile. This patent is widely regarded as the birth certificate of the automobile.

Bertha Benz, without Carl's knowledge, drove the Patent-Motorwagen from Mannheim to Pforzheim (about 106 km), demonstrating its practicality and reliability to the public. This daring journey was a significant marketing boost.

Benz & Co. introduced the Velo and Victoria models, which were more refined and reliable than the Patent-Motorwagen. These cars were commercially successful, contributing to the growth of the company and the popularization of the automobile.