The Type 2 was a prototype automobile

Automobile

An automobile, autocar, motor car or car is a wheeled motor vehicle used for transporting passengers, which also carries its own engine or motor...

 designed by Ettore Bugatti

Ettore Bugatti

right|thumb|Ettore Bugatti in 1932Ettore Arco Isidoro Bugatti was an Italian-born and French naturalized citizen automobile designer and manufacturer....

 in 1901. It won an award at the Milan

Milan

Milan is the second-largest city in Italy and the capital city of the region of Lombardy and of the province of Milan. The city proper has a population of about 1.3 million, while its urban area, roughly coinciding with its administrative province and the bordering Province of Monza and Brianza ,...

 Automobile Exhibition that year and gained the notice of the Baron de Dietrich. de Dietrich managed an automobile factory in Niederbronn in Alsace

Alsace

Alsace is the fifth-smallest of the 27 regions of France in land area , and the smallest in metropolitan France. It is also the seventh-most densely populated region in France and third most densely populated region in metropolitan France, with ca. 220 inhabitants per km²...

, France

France

The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...

, and contracted Bugatti to develop new models for him under the Dietrich-Bugatti marque.

Type 3 and 4

Approximately 100 Types 3, Type 4 and Type 5 Dietrich-Bugatti automobiles were produced from 1902 through 1904.

Type 5, 6, and 7

In 1904, Ettore Bugatti and Émile Mathis designed a new car, the Type 5 or Hermes. It was a prototype of a more-modern model with a four-cylinder

Straight-4

The inline-four engine or straight-four engine is an internal combustion engine with all four cylinders mounted in a straight line, or plane along the crankcase. The single bank of cylinders may be oriented in either a vertical or an inclined plane with all the pistons driving a common crankshaft....

 engine and four-speed manual transmission

Manual transmission

A manual transmission, also known as a manual gearbox or standard transmission is a type of transmission used in motor vehicle applications...

. Chain drive

Chain drive

Chain drive is a way of transmitting mechanical power from one place to another. It is often used to convey power to the wheels of a vehicle, particularly bicycles and motorcycles...

was used. It went into production as the Dietrich-Bugatti Type 6 and Type 7 1000 times