Schalke relegated from Bundesliga: A Royal Case of the Blues

With over 160,000 members, Schalke 04 are the second-biggest football club in Germany, seven times German champions and one of the biggest names in world football.

As recently as 2018, they were Bundesliga runners-up. In 2011, they reached the semifinals of the Champions League. Schalke's youth academy, the famed Knappenschmiede, has produced such talents as Manuel Neuer, Leroy Sané, Julian Draxler, Mesut Özil and Leon Goretzka.

But now, for the first time in 33 years, the Königsblauen (Royal Blues) have been relegated to the second division.

The final nail in the coffin came with defeat away at Arminia Bielefeld on Tuesday night, a result which merely confirmed the inevitable. In 15 miserable months, going all the way back to January 2020, Schalke have won just two Bundesliga matches. Earlier this season, they came within 90 minutes of equalling Tasmania Berlin's record 31-game winless streak from the 1965-66 season.

They were spared that ignominy thanks to a 4-0 win over Hoffenheim. It remained one of only two wins so far in a season in which Schalke have lost 21 games, conceded 76 goals and scored only 18. They're down with four games still to play.

And yet that's only the tip of the iceberg. The road to relegation is longer than the Schalker Meile, the iconic street that leads from the center of Gelsenkirchen in western Germany, through the working-class district of Schalke, to the club's 62,000-capacity Veltins Arena, a modern, spaceship-like structure that shares the Ruhrpott skyline with the headframes of closed mine pits.

It's a journey which has left Schalke with €217 million ($257.8 million) of debt, an inexperienced coach, a squad unfit for the second division, a supervisory board divided in acrimony, a thoroughly disillusioned fanbase and a list of intrigues to rival any Netflix drama.

"Bad decisions, bad decisions, bad decisions — from A to Z," said one club source. "It's a disaster."

Where to begin?

'The Tönnies System'

Thirty kilometers east of Gelsenkirchen in a city known to Schalke fans only as "Lüdenscheid North," Borussia Dortmund supporters have a song about their local rivals from "Herne West." It's called "Am Tag als der FC Schalke starb" or "On the day that FC Schalke died."

There are several candidates for that precise day in Schalke's recent history, not least Tuesday night, when rival fans set off celebratory fireworks across the city and footage emerged allegedly showing Schalke fans chasing their own players upon their return from Bielefeld.

But, for Kornelia Toporzysek, a lifelong Schalke supporter, lawyer and former member of the club's honorary board, it was August 7, 2019, the day on which her fellow board members acquitted Clemens Tönnies of racism.

Earlier that week, Tönnies, Schalke's de facto club boss since 2001, had spoken at a business conference in nearby Paderborn, where he had advocated for the construction of power plants in Africa so that, when provided with electricity, "[Africans] will stop producing children as soon as it gets dark."

Tönnies apologized but, despite calls from Schalke fans for him to resign, the honorary board, a form of internal club ethics commission, allowed him to temporarily step down from his position for three months of his own accord. Toporzysek resigned in protest.

"For me, that was the turning point," she tells DW. "That was the moment when Herr Tönnies placed his own interests and his own reputation above the club. He didn't want to be cast as a racist and the club succumbed to his demands in order to appease him."

The club's handling of the whole affair was symptomatic of what Toporzysek calls the "Tönnies System," in which Schalke's entire club structures were tailored to suit one man, the background against which Schalke's dramatic collapse and relegation has played out.

'Alpha alpha'

For over two decades, Schalke 04 has been synonymous with the name of Clemens Tönnies. A local billionaire who made his estimated €1.4 billion fortune in Germany's meat processing industry, Tönnies, 64, joined Schalke's supervisory board in 1994 and became its chairman in 2001.

Under his stewardship, Schalke established themselves as one of the top clubs in Germany and Europe, finishing Bundesliga runners-up four times, winning three German Cups, reaching the Champions League quarterfinals in 2008 and the semi-finals in 2011.

Crucially, it was Tönnies' extensive business network that brought about Schalke's lucrative sponsorship deal with Gazprom, the Russian gas company whose name has adorned the club's royal blue shirts since January 2007, while he was also a driving force behind the development of Schalke's new Berger Feld academy and training facilities.

"Of course, Tönnies has done a lot for the club; he's not the devil incarnate," says Toporzysek. "Tönnies is a leader, he's alpha alpha, a proper businessman who leads and decides."

Another club source adds: "He appears friendly and approachable, it's not like you can't talk to him. He's the sort of person who'd turn up at a village festival and have a beer with everyone."

But, simultaneously, another picture emerges. "Everyone at Schalke knows that there was just one powerful man and that was Clemens Tönnies," says Toporzysek, describing structures at the club as "patriarchal" and "autocratic."

"Tönnies filled key positions with people whose loyalty was as much to him as it was to the club," she says.

Another source agrees: "Everyone who gets close to him does so subserviently. Everyone is dependent on him. He's Clemens Tönnies, the rich man who is always right and won't be told 'no.'"

Uwe Kemmer, a supervisory board member for nine years until December 2020, also confirms: "Clemens Tönnies is alpha alpha. There was a very distinct loyalty towards him."

But he insists: "It's not as if we all sat there and did as we were told. We had our disagreements. I wouldn't suppress my opinion on Schalke just because Clemens Tönnies thought differently."

Gradually, however, Tönnies' dominance of club affairs at Schalke became increasingly problematic. 

Christian Heidel and the 'paradigm shift'

Between 2010 and 2016, Schalke almost halved their debts through regular Champions League and Europa League qualification and the lucrative sales of big-name players including Neuer (Bayern Munich, €30 million), Draxler (Wolfsburg, €43 million) and Sané (Manchester City €52 million).

But Tönnies wanted more. The odd Champions League qualification was no longer enough, nor was simply paying off debt. Schalke had enviously watched Jürgen Klopp's success in neighboring Dortmund, but sporting director Horst Heldt had been continually frustrated in his own attempts to lure the young Thomas Tuchel from Mainz.

It was time for a restart, or what one club source in hindsight calls a "paradigm shift." To great fanfare, Heldt was replaced by the charismatic Christian Heidel from Mainz, who installed Markus Weinzierl, previously of Augsburg, as head coach.

Over the next two-and-a-half years, Heidel would sign off on four of Schalke's five most expensive ever signings, namely Breel Embolo (€26.5 million from Basel), Nabil Bentaleb (€19 million from Tottenham), Sebastian Rudy (€16 million from Bayern Munich) and Yevhen Konoplyanka (€12.5 million from Sevilla), while allowing Eric Maxim Choupo-Moting, Sead Kolasinac, Max Meyer and Goretzka to leave on free transfers.

"We burnt through money under Heidel," recalls Kemmer. "You need to make sporting decisions together as a team, in conjunction with the coach, but Heidel wanted to do everything on his own. He burnt over €150 million."

At the end of the first season under Heidel, Schalke finished 10th and missed out on European football for the first time since 2000. On the final day of the season away at Ingolstadt, Schalke's ultras unfurled a scathing banner reading: "We thank the team for following us in such great numbers this season."

Domenico Tedesco: 'You know I'm more Mourinho, don't you?'

Heidel replaced Weinzierl with Domenico Tedesco, the young German-Italian tactician who had just rescued second-division side Erzgebirge Aue from relegation.

Under Tedesco, Schalke stormed to a 2nd-place finish in a season which also featured an unforgettable derby away at Borussia Dortmund when Schalke came from 0-4 down to draw 4-4. When they then beat Dortmund at home, Tedesco was invited up onto the ultras' pedestal to lead the Nordkurve in celebration.

"Tedesco was an absolutely friendly and sympathetic person," says one club source. "He had a good relationship with the players, and the players followed him." This reporter fondly recalls post-match chats with Tedesco, where he would listen closely to questions and respond articulately and in detail.

Yet, despite the second-place finish, there was criticism of Tedesco's conservative football. Even Tedesco admitted to a club source at the time: "On a scale of Guardiola to Mourinho, you know I'm more Mourinho, don't you?"

But Tedesco was also a workaholic and a perfectionist, and he tried to adapt his style the following season — unsuccessfully. Schalke lost their opening five games and rifts appeared in the dressing room, rifts which the young coach was left to deal with alone.

"The hope was that Tedesco would be our Klopp for the next few years," says Uwe Kemmer. "But he was a young coach who wanted too much. He was close to burnout by the end, you could see it in his eyes."

Kemmer recalls a trip back from Manchester in March 2019, where Schalke had been thrashed 7-0 by City. "I was sat behind him on the plane and he immediately took his laptop out to start preparing for the next game. He was never able to relax."

Kemmer believes Tedesco needed more support from a management figure, who could have also helped Heidel with transfers and squad planning. "But when we suggested that to Heidel, he was insulted. That's why he ended up stepping down. He couldn't make the jump from Mainz to Schalke."

Heidel had already resigned before the City defeat, and Tedesco was relieved of his duties shortly after. Schalke finished 14th. The paradigm shift had achieved little, but worse was to come.

Schalke, coronavirus and 'a massive tsunami'

On Friday, January 17, 2020, Schalke beat Borussia Mönchengladbach to go fifth in the Bundesliga, mid-way through David Wagner's first season at the club. Little did anyone know that it would be 357 days before Schalke won again in the league, or about what other existential threats the club would face.

By the time the Bundesliga was put on hold in March due to the pandemic, the winless run stood at seven games, but Schalke were still sixth. There was a feeling that the enforced break would do the team good, giving players time to come back from injury before pushing on for the Europa League. But the restart began with a 4-0 derby demolition in Dortmund, the winless run continued, and Schalke finished 12th.

Having missed out on European football in three of the previous four seasons, vital revenue had fallen away and the club officially embarked on a new course with a reduced budget and aims.

"We can't continue as we have been doing," said then marketing director Alexander Jobst. "Schalke have cut a miserable figure in recent months. We haven't done ourselves any favors, we've made mistakes, and we apologize."

"Miserable" was putting it lightly. When the Bundesliga was forced to stop, it was reported that up to 13 of the 36 clubs in Germany's top two divisions could be facing existential financial trouble, chief among them: Schalke.

"Everything came together at once," explains former supervisory board member Kemmer. "No Champions League money, then corona, losing €2-3 million for every home game without fans, the wasted money under Heidel. It was a massive tsunami."

Like many clubs, Schalke took steps to save money, including requesting that season ticket holders waive, or at least defer, reimbursement for matches they would no longer be able to attend. But Schalke went a step further, asking fans to submit financial proof of why they couldn't afford to waive their refunds. Meanwhile, 24 youth academy drivers were also made redundant, often older fans who had been on part-time, €450-per-month, contracts.

To make matters worse, less than a year on from the racism scandal, Clemens Tönnies was again in the headlines following a coronavirus outbreak at one of his meat processing plants.

For Schalke, a club which prides itself on its working-class heritage and family values, it was a PR disaster. The Ultras Gelsenkirchen called their club "morally bankrupt."

"The money-saving measures were incompatible with Schalke 04," says Kemmer. "They were remarkably detached from the reality faced by Schalke fans, a result of a bad leadership culture within the club."

Toporzysek believes the club completely lost its feeling for what Schalke means to its supporters.

"We members have a close, emotional attachment to our club," she says. "We're not just customers; we are the club! Somebody must have known how such measures would go down, but there was seemingly no alarm system, no radar, no alert."

Five head coaches and a 'lame duck board'

On the final day of last season, Schalke lost 4-0 away at Freiburg, extending the winless run to 16 games. Simultaneously, hundreds of Schalke supporters protested outside the club's offices in Gelsenkirchen. Tönnies resigned, but David Wagner, on a three-year contract, kept his job into a second season. "A massive mistake," believes Kemmer.

Wagner still retained the trust of Jochen Schneider, the new director of sport who had arrived in Gelsenkirchen promising to modernize the structures at Schalke. He brought in additional therapists, psychologists and general staff who could help alleviate the load under which Tedesco had suffered.

But his decision to hold on to Wagner proved to be the first of many missteps. Wagner was sacked anyway after starting the next season with defeats to Bayern Munich (8-0) and Werder Bremen (3-1), and replaced by another former Augsburg coach Manuel Baum, who lasted 11 winless games before being replaced by Huub Stevens (temporarily) and Christian Gross (permanently).

Gross hadn’t coached in Europe for nine years, but at least ended Schalke's winless run with that 4-0 win over Hoffenheim. But after losing six of the next eight, Gross, Schneider and the entire coaching staff were also dismissed. The inexperienced Dimitrios Grammozis became Schalke's fifth head coach of the season.

For Kemmer, who resigned from the supervisory board in December in protest at its inertia and seeming inability to act in the absence of Tönnies, the decision to sack Schneider came months too late. "I thought we needed assistance or a replacement for Schneider as early as autumn, but the board didn't even want to discuss it," he said.

"The winter transfer window was a disaster, and it was clear then that we were going down. We needed to start planning for the second division with a new sporting director and coach immediately. It wasn’t as if the board were unable to act; they were unwilling to act. It was a lame duck board."

'Who are we? What do we stand for?'

In March, as Schalke's inevitable relegation edged closer, local media reported that a group of 14 influential people with close links to the club had contacted Ralf Rangnick, proposing to install the former Hoffenheim and RB Leipzig boss as director of sport and figurehead of a rebuild.

But Rangnick, a former Schalke coach (2004-05 and 2011), ruled himself out, saying: "Given the numerous uncertainties inside the club, I don't see myself in a position to take over sporting responsibility for Schalke 04."

Instead, the rebuilding job has been entrusted to Peter Knäbel, the 54-year-old former Hamburg sporting director perhaps best known for leaving a backpack containing sensitive HSV contract information in a local park in 2015, but who has nevertheless built a solid reputation with his work in Schalke's youth academy and who knows the club well.

Even further-reaching structural changes are also on the agenda. With Schalke announcing a €52 million loss for 2020, ongoing construction work on the Berger Feld training facilities has been halted, with new financial director Christina Rühl-Hamers promising "no more gambles on Schalke's future. We will only spend the money we have, not the money we hope to have."

Finally, there's one last elephant in the room: Schalke are one of only four remaining Bundesliga clubs who have not separated their professional football division into a limited company, theoretically making it more attractive to potential investors.

The process, known as "Ausgliederung," stipulates that the parent club retain 50 percent of the voting shares in any separate company, plus one share, in accordance with the so-called "50+1" rule.

But many of Schalke's 160,000 members are proud of their status as a 100% registered association, or "eingetragener Verein (e.V.)." Any motion to change that would require a three-quarter majority at the next annual general meeting in June, where the future of the club will be decided: a future without Clemens Tönnies and the system he built.

"Schalke needs to get back to the roots," says Uwe Kemmer. "We need to be humbler; we need more identification with the club, and we need to focus on youth. But we also need businesspeople and visionaries, people who put their foot on the pedal."

"We need people who are honest and trustworthy but who also bring sporting and economic competence," adds Kornelia Toporzysek. "We need to sit down together as a club and ask ourselves: who are we? What do we stand for? And what do we want to be?"

After defeat in Bielefeld sealed Schalke's fate on Tuesday, it's time for those questions to be answered.