Reliability was not the main issue. Remember this was in the day when Lugers had good magazines, the correct recoil spring, and ammo loaded to the correct OAL. The P38 supposedly would have required fewer machining operations and be lower in cost.
In the actual case, the P38 sold to the government for the same price as the Luger. It did require fewer machining operations and even more importantly, fewer machine tools. So supposedly ease of production and faster production were the driving influences. Since it was easier to make but sold for the same price one suspects that somebody was pocketing a few coins.
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