Introduced at the 1936 Paris Motor Show, the car designed by Friedrich Geiger was a development of the 500K, itself a development of the SSK. Available as a two-seater cabriolet, four-seater coupe or seven-seater limousine (with armored sides and armored glass), it was one of the largest cars of its time.

The 500K inline 8-cylinder engine has been increased in displacement to 5,401 cubic centimeters (329.6 cu in).

It was powered by dual pressurized carburetors, developing 115 hp (86 kW). In addition, there was a root supercharger attached, which could be operated manually for short periods or automatically when the throttle was fully pushed to the ground.

This increased power to 180 hp (130 kW), allowing a top speed of 170 kilometers per hour (110 mph).

Power was sent to the rear wheels through a four-speed manual or optional five-speed gearbox that featured synchronization on the top three gears. The vacuum hydraulic brakes kept the car under the driver's control.

The 540K had the same chassis layout in the 500K, but was significantly improved by replacing the 500K beam frame with oval section tubing - an influence of the Silver Arrows racing campaign.

To meet customers' individual wishes, three chassis variants were available, as in the 500K: two long versions with 3,290 mm (130 in) wheelbase, differing in powertrain and body layout; and a short version with 2,980 mm (117 in). The long variant, called the normal chassis with the radiator directly above the front axle, served as the backbone of the four-seater cabriolets, the 'B' (with four side windows) and 'C' (with two side windows), and for cars. of tourism and bars. The shortest chassis was for the 'A' two-seater cabriolet, installed on a chassis in which the radiator, engine, cockpit and all rear modules [clarifications needed] were 185 mm (7.3 in) away from the front axle.

The Sindelfingen plant employed 1,500 people to create the 540K and allowed great owner customization, meaning that only 70 chassis were built by independent builders.

The owners included Jack L. Warner from Warner Brothers movie studios.

With the outbreak of World War II in 1939, the proposed additional engine abandonment of 5,800 cubic centimeters (5.8 l) for a 580K was aborted, probably after only one car was manufactured.

Chassis production ceased in 1940, with the final 2 completed that year, and previous chassis were still being manufactured at a steady rate during 1940, with smaller numbers being completed from 1941 to 1943. Regular replacement bodies were ordered in 1944 for some cars.

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