Messerschmitt designers had started working on an upgrade of the Bf 110 in 1937, before the production version of the Bf 110 had even flown. In late 1938, the Bf 110 was just entering service, and the RLM started looking ahead for its eventual replacement. Messerschmitt sent in their modified Bf 110 design as the Me 210, and Arado responded with their all-new Ar 240.