Upon starting operations at his new factory in Molsheim in 1910, Bugatti refined his light shaft-driven car into the Type 13 racer. This included boring the engine out to 65 mm for a total of 1.4 L. A major advance was the four-valve head Bugatti designed. Power output with dual Zenith carburetters reached 30 hp at 4500 rpm, more than adequate for the 660-lb (300-kg) car. Leaf springs were now fitted all around, and the car rode on a roughly 2-m (79-in) wheelbase. Although having the appearance of a toy, the Bugatti Type 13 was successfully raced. It was seen at hillclimbs as early as 1910 looking rather out of place compared to the bulky and brutish competition. What the Type 13 lacked in power, it made up in handling, steering, and braking. These important elements were retained throughout all future Bugatti designs. Top speed was at 125 km/h.

The new company produced five examples in 1910, and entered the French Grand Prix at Le Mans in 1911. The tiny Bugatti looked out of place at the race, but calmly took second place after seven hours of racing.

World War I caused production to halt in the disputed region. Ettore took two completed Type 13 cars with him to Milan for the duration of the war, leaving the parts for three more buried near the factory. After the war, Bugatti returned, unearthed the parts, and prepared five Type 13s for racing.

In 1921 the Type 13 was unbeatable. Bugatti's cars finished in the top four places at the Brescia Grand Prix, and orders poured in. Capitalizing on this victory, all subsequent four-valve Bugatti models bore the Brescia name.