The decision to halt the German forces right in front of the BEF during Fall Gelb, is one of the most discussed action from World War II. It is said to have lost the war, as the BEF, more or less Britains entire army, was alloed to fight another day. There have been many speculations as to the decision, and with so much else, the comple truth will probably never be know.
Germany is not a sea nation. They have little experience in this area, and have never used naval transportation in any larger scale. Therefore, they were unaware of how to deal with such a situation (a German general has once stated, that crossing the channel would just be large-scale river crossing!).
They saw the ocean as a wall, through which it was impossible to transport an army, as such short notice anyway. They could not imagine that Operation Dynamo could even happen! The British, being an island kingdom, were seing the channel as a highway, with many opportunities.
When the German Panzers arrived at the river before the Dunkirk area, they were exhausted. They could not continue - they were tired, and running low on fuel and supplies. Furthermore, they had no infantry backup, and they had nearly been cut off at one point from their main force. It was a part of their tactic to keep driving, leaving the infantry behind, and just go on, not stopping at anything - this was their tactic, and it worked for penetration. Therefore, it was a sane military decision to halt them for rest and refit. After all, the Germans didn't think they could go anyway, so they could just prepare to finish off the enemy nice and calmly.
The Luftwaffe, which could use the publicity (the Panzers had recieved much of the credit so far) asked for permission to destroy the BEF on the beaches. Therefore, they were allowed to attack the BEF.
So far, the Germans had not used fighter support, simply because the French airforce was not being used. It was actually not practice among the Allies either. The French could easily have destroyed the Ju 87s, that were about as galant in a dogfight as a rock with wings. They were, however, so shocked by the German attack (as well as uncertain who were actually in command of the French aircrafts - they didn't have any real airforce, and the Generals of the individual army departments were unable to get in contact other than through couriers, and hte French high command was in general ignorant of the danger.) that they just had their fighters hidden in parks, etc. - with retrieveing Allied soldiers seing it with disbelief!
At Dunkirk, the RAF was able to get straight from England, into the attack. They shot the Ju 87s to pieces before they ever reached the beaches (which is why you hear the BEF cursing the RAF for not being there - they were there, but they were taking the enemy out BEFORE they ever reached the lines (if they had attacked after the bombs had been dropped, it wouldn't realy matter...). Therefore, the BEF were relatively left alone. The Germans, who had advanced to the outskirts of the evacuation area by the time the evacuation was more or less over, didn't believe their eyes. They were as amazed as when Moses divided the Red Sea - but they were not stupid enough to attempt to follow them, as the waters - the Royal Navy and the BEF - would have come down on them as on the Pharao..
All contents written by Christian Ankerstjerne unless stated otherwise