Seeking to reduce the development costs of the Type 89 IFV, Japan decides to largely license produce and adapt the Swiss KDE 35mm turret of the Improved MOWAG Tornado:
Facing a Giant: the German armored forces July 1940-1941
The gamble did not pay off. Even though Fall Gelb offered the best odds of victory, it was doomed to fail against the multiple French lines of resistance in the Ardennes and in the Meuse sector where it bogged down.
For the time being, the situation remained stable. Neither France nor Germany had the supplies necessary for combat of high intensity, so operations largely stopped by July. The French forces were also still difficult to use and maneuver, while neither the AdA nor the RAF could seriously threaten ground forces or the Reich itself.
It was time to assess the situation. The French industry was finally getting into high gear and the Allies would soon be flooded with war material. It was clear that they would go on the offensive in the spring or summer 1941. The Germans needed to act quickly to disrupt such plans and regain the initiative. The armored forces were still going to be essential in the defense of the occupied Benelux or a second Battle of France.
Many deficiencies were observed. Production of the latest tank types was very slow, and antitank capabilities were insufficient. The Pz III also still suffered from various reliability problems. The question of firepower and protection would largely solve itself with the introduction of 50mm armor plate, addons, and the 5cm KwK L42 and PaK L60. Nonetheless, the Germans desperately needed more mobile AT, which renewed interest in tank destroyers.
Alarming reports mentionned French and British heavy and superheavy tanks with thick armor (B1 Ter, B40, TOG, Char de Forteresse), real or not. The Pz Sfl IVa bunker buster was an obvious solution with its 105 mm L52 gun, so development was accelerated and 200 were ordered. This could also be useful against the Maginot Line. Same went for the Pz Sfl V and its 128mm gun, which benefitted from the cancellation of the VK 3001(H) vehicle it was based on (judged too weak in firepower), freeing resources for the SPG.
Production of the Panzerjäger I was also intensified to use the entire stock of 47mm Skoda guns. The Pz II chassis also quickly became available for other uses as the 2cm gun was decidedly becoming obsolete. It was proposed to mount the 5cm gun on this chassis instead of the VK 901 of the Pz Sfl I, using a small open-top superstructure.
Finally, efforts were made to deploy even more powerful weapons on the tanks themselves. It was briefly offered to lengthen the 75mm KwK L24 to a L33-36, but even greater performance was requested. The 75mm L40,8 Rheinmetall-Borsig gun was modified for use on both the Pz IV and Stug III chassis, but this program didn't yield results until mid-1941.
Finally, the question of tank production came up. The military and industry were getting increasingly frustrated of constant meddling by the Reich authorities, and namely Kniepkamp and the Heereswaffenamt 6. Daimler-Benz and Krupp particularly criticized his obsession of high speed leading to unproven transmissions and his favoritism of Maybach, churning out engine after engine with no attention to simplicity or improving existing designs. Torsion bars were also still difficult to produce and keep reliable at this time.
Their lobbying eventually paid off. It helped that a Tank Commission was created with Ferdinand Porsche at the helm. Massive increases in tank production were required. Ease of production finally took priority over performance. Both DB and Krupp took advantage of this decision, reorienting the VK 20. program towards evolutionary designs and introducing simpler components.
The BW 40 program, cancelled in May 1940, was restarted. This would involve replacing the 8-wheel suspension of the Pz IV with 6 wheels of larger diameter, already tested on the Pz Sfl IVb. Sturdier and quicker to produce, it could cope with the weight of the uparmored and upgunned Panzer IVs without trouble. This was also used on the Pz Sfl IVa.
Daimler-Benz completely rethought the Pz III. Without the need for torsion bars, they restarted development of a brand new leaf-spring suspension, without the drawbacks of those used in early Pz III models. The gearbox was also replaced with a simpler Wilson-type planetary transmission derived from the Pz 38(t). Finally the engine was to be replaced by the 360hp MB 809 diesel, as it was sturdier than the Maybach HL120, more powerful and economical and would offer a new source of engines. This led to the Pz III n.A by late 1941, towards the tail end of the III. Reich.
Fierce fighting indeed restarted in March 1941 with an Allied offensive through the Benelux. Surpassed in numbers and severely lacking in ressources, Germany was forced to give terrain, but managed to obtain some respite by momentarily stopping the offensive on the Rhine. The Pz Sfl IVa Brummbär (but unofficially called Dicker Max) proved the greatest asset, destroying the heaviest Allied tanks at long ranges.
Author's note: I always thought that Germany missed opportunities with early war programs, so this scenario is very practical to let them shine.