Henry Ford invented the car--or so even President Obama believes. In actuality, the car as a concept has several inventors. It is effectively a scaled down version of the steam locomotive and, as such, has a line of predecessors dating back centuries. As we covered in our last entry on The Second Act, the auto industry itself was born out of the wreckage of the failed Bicycle Trust. Thanks to this Trust, there were all sorts of little shops spread throughout the country dedicated to the industry of mechanized mass movement. The auto was the laggard of the Trust’s spawn. By the time it was viable, the Trust’s other children, earth moving equipment and light rail, were already quite commonplace. .
The world was in no way ready for the auto when it first appeared. Specifically, the roads weren’t ready. Roads of the time were crowned, rutted, dirt affairs, most of which did not broadly interconnect. It wasn’t until the 1950s that all of the roads in the United States actually connected. Before then, the only roads that bound the country together were made of steel and ridden by the iron horse. Towns were centered either on a rail spur or a river bank or a port. What roads there were went to these places, not necessarily to other towns. So there’s no real place to drive a car to, even if you had a car that actually functioned.
Even a Sherman Tank would have been hard pressed to traverse cross country at the time.
The first cars had very little utility. They were up-scaled, powered quadra-cycles. (Or tricycles) Like computers of old, they were mostly the possessions of hobbyists. One of the great pastimes of the hobbyists was racing their contraptions or trying to play polo with them. Horseracing was the most popular professional sport in the world at the time and the auto just seemed like a natural fit. Polo, believe it or not, was the second most popular professional sport.*1 Despite numerous tries, the auto proved to be a poor substitute polo pony. But auto racing caught on.
It was from the popularity of auto racing that the popularity of the auto itself spread. Henry Ford first came to the public’s attention as an auto racer. He was also one of the first to hire other racers to drive his cars in events. Ford is, however, something of a late entry into the trend.
By the time Ford showed up, car kits were already widely available. It was a side business, dominated by hardware stores and bicycle shops. Kits were also available to the mechanically inclined for home assembly.
History, as told, often muddles what Ford did or how he did it. He didn’t invent the car. He wasn’t even the first to use an assembly line. Nor was he the actual father of the affordable car.
The kit cars were pretty affordable. Besides being impractical, these ‘cycle cars’ quickly gained a reputation as death traps. Brakes, believe it or not, were fairly standard on all kit cars—the technology having been taken from the horse carriage industry. What made the cycle car particularly deadly was the lack of a differential, a device which causes a disparity in the speed of your wheels while turning. Without a differential, even the lowest slung car has a very good chance of flipping over while turning.
Eventually, the kit cars got better. As I mentioned in our last entry on the electric car, early cars came with several types of drive systems. Pope, the earliest mass producer of cars, offered its models in steam propelled, electric and gasoline powered variants. They also came in two different configurations. One was the conventional configuration that we know today, wherein the car sits a few inches above the ground at the center of four wheels affixed to a low slung frame. The other was what was called a high wheeler, an actual horseless carriage looking thing with large, thin wheels.*2 This configuration was the more practical and widespread, since ground clearance was an issue. Although race cars remained low to the ground, cars people actually drove in civilian life were more likely to be the high wheeled variety.
No two cars were exactly alike, even if they came from the same kit. Let’s just say there were assembly issues. These issues became more complicated with the steam and electric powered variants. There were several types of electric battery powered engines, all of them rather inefficient and most of them very complex when it came to coordinating power transmission. (Putting one engine on each wheel and then failing to coordinate wheel speeds was a recurrent problem.) Steam engines were masterpieces of complex plumbing, with many tiny and temperamental parts. By contrast, the gasoline engines were not so taxing to configure and soon came pre-configured out of the box. Imported gasoline engines made by Knight and Daimler began to flood the hobby market.
American forges soon got into the act. By the time Ford starts his racing career, there are several completely proven sets of drive systems in mass production. By drive system, I mean the engine, the frame, brakes, differential, axels and transmission as a set compatible unit. That pretty much is a car. All you have to add is seats and a body. Adding these things is all the some 2000 auto manufactures of the time really did. Some of them did less than that. Many cars were shipped (mostly from France) with the body and drive systems pre-made. Our local auto manufacturer was just screwing the things together and then sticking his own brand name on them.
It was the sudden appearance of these new, mostly foreign, cars that really gave the automobile its second wind of popularity. They also spelled the death of the high wheeler. Freed from the drudgery of having to custom fit the mechanics, auto manufacturers went to town on sprucing up the amenities. The car became bling: a luxury item targeted at the urban well to do. Fire your groom, clean out the stable and get yourself a car!
They were sold by special appointment at salons and boutiques. For the same effort it took to make a high wheeler--a low margin product for the common man--one could make a bling mobile--a high margin item with an increasing demand. The entire industry was in a race to the top of the market. This is where we get our Dusenbergs, Stutz Bearcats, Pierce Arrows, Peerless and Packards from.
No one was out to make an affordable car anymore, not even Henry Ford. Ford had already seen his first enterprise go splat when he set out to make the most reliable expensive car he could. Ford believed that he could increase the quality of a car by completely standardizing all of its parts and assembly methods. At the time, even the new foreign kit cars weren’t exactly alike.
He succeeded. Ford’s new cars were identical to each other, had interchangeable parts. With standardization came better fits and increased service life. Ford’s car became the choice of those well to do enough to afford a car. It was simply a much better product. And Ford was the top seller, making more cars than the rest of the industry combined.
It was a great car that only one percent of the public could afford. Ford felt that this wasn’t a broad enough market and hit on the idea of making a car that was configured emtirely for the purpose of being mass produced. His conjecture was that through control of commodity prices, he would be able to drive the per unit costs downward. His backers balked at this idea. They were perfectly satisfied with 50% of their very lucrative and exclusive market and felt no need to take any further chances. They kicked Ford out of the company and renamed themselves Cadillac, which with Buick, became the lynchpin of General Motors.
Strike one against General Motors: they kicked out Henry Ford. He’s shouldn’t feel bad. They also kicked out Mr. Buick when he became uppity.
Making an affordable car was hardly on the top of your average auto maker’s ‘to do’ list. As it was, every car they made sold. There were waiting lists for the high end vehicles, so why bother with wheels for the masses? Ford was a pure visionary in his quest.
He was not, however, the first person to mass produce an affordable car. Pope had an affordable car, but it never sold all that well. When Pope collapsed after the demise of the Electric Car Trust, it left a void that several firms tried to fill. One of those firms was the Olds Motor Car Company, which, like Pope, offered cars at different distinct price points.
Olds Motor Car was fronted by Ransom E. Olds, also a race car driver/inventor. He had just set up his operations when tragedy struck. The factory, its inventory and materials were destroyed in a fire, except for two examples of the cheap models. In an effort to stay in some form of business, they took the insurance money and started cranking out just the cheap, curved dash, merry little Oldsmobiles.
They could not keep the damn things in stock. It started a craze. They were called Olds Motor Cars initially. The popularity of the curved dash model spawned a sheet music song that christened the cars ‘Oldsmobiles.’ The firm decided not to fight it and renamed itself.
R.E. Olds thought they were onto something. The market for these affordable, reliable cars seemed unlimited. For various reasons, the firm decided not to concentrate on producing just these cars and resumed offering a full line as soon as they could.*3
If nothing else, the success of the Merry Little Oldsmobile spurred Ford on. Only he was out to produce cars just at the lowest price level. Moreover, he wanted to drive that lowest price level down. His new firm was entirely dedicated to producing a vehicle that would hit at a specific price point.
He failed twice. His first two models were fine vehicles, clearly the highest quality in their class. He gained the lion’s share of the lower end market. In fact, he was selling more cars than any other manufacturer. But it wasn’t good enough. He had his mind set on delivering a car at a set price and so far he was about $100.00 off.
This price point was entirely a product of Ford’s imagination. At the time, all cars sold and sold well, most at the $1200.00 to $5000.00 price points. (Pretty darn expensive, really.) There were cars at Ford’s under $500.00 point, but most of them were junk or cycle cars of dubious mechanics. No one was lining up for the under $500.00 cars when they were available. And no on other than Ford thought there was a profit to be made at that level.
Each time Ford ‘failed’ he didn’t merely tinker with his previous design or rework the order of assembly. Instead, he demolished the factories and started over. Unlike other manufacturers, Ford believed that the factory itself was disposable, subservient to what it produced. Each of Ford’s factories was custom designed to produce just one model.
He hit on the third try with the Model T. Thanks to a new form of light weight, high strength steel, the Tin Lizzie was able to come in at the price Ford had envisioned. It was an instant hit, rendering everything in its price class and slightly above instantly obsolete. Cycle cars and high wheelers vanished overnight.
The Model T captured 90% of the auto market and held that position for ten years. Most of the people who purchased a Model T had never owed a car before. It grew the auto industry by exponential proportions for each of the first ten years of its production run. Cars were now everywhere. Of the half of the auto industry that Ford didn’t own outright, half of that was dedicated to manufacturing ‘aftetermarket’ items for the Model T.*4
Having come up with what he thought was the ultimate car, Ford stood pat with the Model T for twenty years.
The rest of the auto industry left Ford alone for the first ten years. Not necessarily by choice. Most of what remained of the auto industry was controlled by two largely bankrupt trusts, General Motors and United States Motors. Neither of them really ever got their acts together, either. Both were saved from oblivion by entering into Ford’s market. And both were saved, as it turns out, by the same man.
The bankruptcy of United States Motors and a stock shock at General Motors had caused major disruptions at every manufacturer, but Ford. These two trusts owned the parts manufacturers on which the rest of the industry depended. With United States Motors suddenly gone, General Motors was scrambling to keep its clients in business.
General Motors dispatched its design wunderkind Walter Chrysler to the Overland car company with orders to create a knock off Model T for the firm. Chrysler and his team devised a new vehicle incorporating all of the amenities available on Buicks and Cadillacs as adapted to a faster production method. Overland (also known as Willys, AM General and Jeep) had previously been producing a car entirely made of United States Motors parts, so they had diddly without this new car. The Chrysler team was able to execute their plan in short order and the new Overlands were just ready to roll--
--Unfortunately, General Motors didn’t own Overland. General Motors didn’t have any money, having just paid a fortune to get rid of its previous C.E.O. The previous C.E.O. of General Motors, the man to whom this money had been paid, had plenty of money and turned around and bought Overland. He in turn released Walter Chrysler’s new Overland car as the Chevrolet.*5
The Chevrolet proceeded to drive the Model T straight off the road. Henry Ford lost half of his market every year until he finally retired the Model T. At that point, Ford was reduced to 5% of the market. That’s about as dramatic of a decline as it gets. Chevrolet did so well that it bought General Motors out for cash.
After the Overland fiasco, Walter Chrysler wound up at Maxwell Motors, which was literally all that was left of United States Motors. He brought the same team which devised the Chevrolet with him. Together they embarked on a plan to make an even nicer, more modern version of their original design. This time they actually got out the door without someone monkeying with them. The new cars saved Maxwell from oblivion. In recognition of Chrysler’s success, Maxwell renamed itself after him.*5
As we have seen, the auto industry is not just a great second act in and of itself, but it is loaded with great second actors. It is an opera of focus and resilience. But like opera, sometimes the plots turn tragic. In the conclusion of the Second Act we will cover the exploits of people who should have quit while they were ahead. For the most part, we will be staying with the auto industry and continue the stories of Henry Ford and the C.E.O. of General Motors. We will also be meeting the man behind the Zeppelin. It’s an illustrated guide to effort utterly wasted.
*1. Professional sports of the time also included Baseball, Rowing and Boxing, none of which seem adaptable to the car. Why people wanted to play sports with their cars is somewhat beyond me. Cars were a novelty item and thus a draw. Many sports were mere roadside spectacles, an excuse to charge a crowd money for attendance, so anything is game. There were also attempts to adapt the car to the sport of Rugby.
*2. Much of the information I have comes from a magazine called Horseless Age, which was the original bible of the auto industry. Despite the magazine’s name, the term ‘horseless carriage’ was never in popular usage. Very early on the public and manufacturers began to refer to them as automobiles or autos or cars for short. Even Horseless Age eventually followed suit, becoming Auto Age.
*3. The last of the high wheelers, the Merry Little Oldsmobile was a merry little deathtrap. Originally configured for an electric engine, when mass produced with a gasoline power plant, the thing moved a tad too fast to be safe. It quickly gained a reputation for throwing people, toppling over and generally being uncontrollable. The steady nationwide parade of bodies into boot hill put a damper on the fad. In the end it merely reinforced the idea that any car that cost less than $1000.00 was a coffin waiting to happen.
*4.Unlike the Merry Little Oldsmobiles and other cycle cars, the Model T was a real car. It was not a high wheeler, but a low slung design which actually protected the occupants to some degree. But that was about it. Other than that, the thing came pretty stripped. Even what we would think of as basic systems, such as a radiator, had to be bought from other parties. It didn’t have a roof, but rather a canvas canopy. Some of this can be accounted for by Ford’s unwillingness to change his base design to accommodate what he felt were unproven technologies. Mostly, Ford thought the thing was perfect as is. Thanks to his stubbornness, about half of the profit from a Model T went to people other than Ford. As we will see in the concluding installment of The Second Act, Ford had a number of bad ideas.
*5. Part of Chevrolet’s success was that it was three different cars, all positioned at the Model T’s magic under $500.00 price point. Each of the three models was running out of their own dedicated plants, much as the Model T was. Chevys came in a variety of options and colors, all factory installed, which was yet another advantage. Thanks to having three plants, they were able to match Ford unit for unit. Of the three models, Chrysler’s was the most popular. Chevrolet itself was named after a race car driver. The model the racer Chevrolet actually designed was something of a dud and was discontinued after the first year. Chevrolet left the firm soon afterwards to found the American “OK” Car Company which featured his designs exclusively. That firm went bust fairly quickly.
*6. That is a long story told very short. In a way Walter Chrysler is far more nutty than Henry Ford. Chrysler was a very rich man even before he got into cars. His entire automotive career is a second act. The guy just liked to build cars. When the political situation at General Motors got weird, he left. At Maxwell he was supposedly just renting their production facilities, funding the project out of his own pocket. Spurred by strong sales, his production soon overwhelmed Maxwell and they begged him to take over the firm. Chrysler is said to have worked for $1.00 a year, plowing his profits back into the company.
Newsweek has returned to the world of pulp and so will this blog. The website will soon have a new cover story, a paid blog offering from aspiring paid blogger Mister Fun. We may have a few new games to post soon, too.
No comments:
Post a Comment