Ford Model T
Henry Ford And The Model T
On May 26, 1927, Henry Ford watched the fifteen millionth Model T Ford
roll off the assembly line at his factory in Highland Park,
Michigan. Since his "universal car" was the industrial success story
of its age, the ceremony should have been a happy occasion. Yet Ford
was probably wistful that day, too, knowing as he did that the long
production life of the Model T was about to come to an end. He climbed
into the car, a shiny black coupe, with his son, Edsel, the president
of the Ford Motor Company. Together, they drove to the Dearborn
Engineering Laboratory, fourteen miles away, and parked the T next to
two other historic vehicles: the first automobile that Henry Ford
built in 1896, and the 1908 prototype for the Model T. Henry himself
took each vehicle for a short spin: the nation's richest man driving
the humble car that had made him the embodiment of the American dream.
Henry Ford invented neither the automobile nor the assembly line, but
recast each to dominate a new era. Indeed, no other individual in this
century so completely transformed the nation's way of life. By
improving the assembly line so that the Model T could be produced ever
more inexpensively, Ford placed the power of the internal combustion
engine within reach of the average citizen. He transformed the
automobile itself from a luxury to a necessity.
The Advent of the Model T seemed to renew a sense of independence
among Americans who had lost their pioneer spirit to
industrialization. Yet the methods that Henry Ford devised for
producing his car so efficiently advanced that very
industrialization. Like its inventor, the Model T represented both
high ideals and hard practicalities.
A Tinkerer In An Emerging Industry
By rights, Henry Ford probably should have been a farmer. He was born
in 1863 in Dearborn, Michigan, on the farm operated by his father, an
Irishman, and his mother, who was from Dutch stock. Even as a boy,
young Henry had an aptitude for inventing and used it to make machines
that reduced the drudgery of farm chores. At the age of thirteen, he
saw a coal-fired steam engine lumbering along a long rural road, a
sight that galvanized his fascination with machines. At sixteen,
against the wishes of his father, he left the farm for Detroit, where
he found work as a mechanic's apprentice. Over the next dozen years he
advanced steadily, and became chief engineer at the Edison
Illuminating Company. At twenty-four, Ford married Clara Bryant, a
friend of his sister's; he called her "The Believer," because she
encouraged his plans to build a horseless carriage from their earliest
days together. For as Henry Ford oversaw the steam engines and
turbines that produced electricity for Detroit Edison, inventors in
the U.S. and Europe were adapting such engines to small passenger
vehicles. On January 29, 1886, Karl Benz received a patent for a crude
gas-fueled car, which he demonstrated later that year on the streets
of Mannhelm, Germany. And in 1893, Charles and Frank Duryea, of
Springfield, Massachusetts, built the first gas-operated vehicle in
the U.S.
In the 1890s, any mechanic with tools, a workbench, and a healthy
imagination was a potential titan in the infant industry. Even while
continuing his career at Edison, Ford devoted himself to making a
working automobile. In 1891, he presented Clara with a design for an
internal combustion engine, drawn on the back of a piece of sheet
music. Bringing the design to reality was another matter, but on
Christmas Eve 1893 he made a successful test of one of his engines, in
the kitchen sink.
The engine was merely the heart of the new machine that Ford hoped to
build. On weekends and most nights, he could be found in a shed in the
back of the family home, building the rest of the car. So great was
his obsession that the neighbors called him Crazy Henry. However, at
2:00 A.M. on June 4, 1896, Crazy Henry punched a large hole in the
wall of his shed, and emerged at the wheel of an automobile -- his
automobile. In the weeks that followed, Ford was often seen driving
around the streets of Detroit.
Later that year, Ford attended a national meeting of Edison
employees. Thomas A. Edison had been Ford's idol for years. But at the
meeting, it was Edison who asked to meet the young inventor, after
word got around that the obscure engineer from Detroit had actually
built an automobile. "Young man, you have the right idea," Edison
said. "Keep right at it". Ironically, he was adamant that Ford not
waste his time trying to make a car run viably on electricity.
Back in Detroit, Ford showed that he was no mere hobbyist: he sold his
prototype for $200. For three years, he watched the new field of
automaking develop, and he progressed along with it. In 1899, thirty
American manufacturers -- most of them based in New England --
produced about 2,500 cars. Still, most Americans in the market for
automobiles became accustomed to buying imported ones. In 1898,
though, the domestic bicycle industry faced an unusual slump and many
manufacturers decided to turn to automaking to keep the factories
busy.
Offered a senior position and part ownership of a new company, the
Detroit Automobile Co., Ford, thirty-six years old, quit the Edison
Illuminating Company. Across town, the firm that would become
Oldsmobile was launched at the same time. The Detroit Automobile
Co. failed, without producing any cars, and Henry Ford was ousted by
angry investors. (The firm survived, emerging from reorganization as
the Cadillac Motor Car Company.)
Building A Motorcar For The Great Multitude
Ford continued to pursue his dream. Early automobile promotion took
place largely on the racetrack, where manufacturers sought to prove
roadworthiness by putting their cars on public view and pressing them
to their very limits. In 1901, Henry Ford poured his expertise into a
pair of big race cars, one of which he entered in a ten-mile match
race against a car built by Alexander Winton, a leading automaker from
Ohio. The race took place in Grosse Pointe, Michigan, and Ford's car
won. Because of the victory, the coal merchant Alexander Malcomson
agreed to back Ford in a new business venture. In 1903, they formed
the Ford Motor Company, in association with about a dozen other
investors. Capitalized at $100,000, the company actually started with
cash on hand of about $28,000. Some investors contributed other types
of capital; for example, the Dodge brothers, John and Horace, agreed
to supply engines.
The company purchased most of the major components for its new models,
a common practice of the day. Teams of mechanics built cars
individually at workstations, gathering parts as needed until a car
was complete. In 1903, Ford's 125 workers made 1,700 cars in three
different models. The cars were comparatively expensive, and their
high profit-margins pleased the stockholders. Malcomson decided to
start yet another automobile company. But when it failed, he was
forced to sell his other assets, including his shares in Ford. Henry
Ford bought enough of them to assume a majority position. The most
important stockholder outside of the Ford family was James Couzens,
Malcomson's former clerk; as General Manager, then vice president and
secretary-treasurer at the Ford Motor Company, he was effectively
second-in-command throughout many of the Model T years.
The direction of the company toward even pricier models had bothered
Henry Ford. He used his new power to curtail their production, a move
that coincided with the Panic of 1907. This case of accidental good
timing probably saved the company. Ford, insisting that high prices
ultimately slowed market expansion, had decided in 1906 to introduce a
new, cheaper model with a lower profit margin: the Model N. Many of
his backers disagreed. While the N was only a tepid success, Ford
nonetheless pressed forward with the design of the car he really
wanted to build. The car that would be the Model T.
"I will build a motorcar for the great multitude," he proclaimed. Such
a notion was revolutionary. Until then the automobile had been a
status symbol painstakingly manufactured by craftsmen. But Ford set
out to make the car a commodity. "Just like one pin is like another
pin when it comes from the pin factory, or one match is like another
match when it comes from the match factory," he said. This was but the
first of several counterintuitive moves that Ford made throughout his
unpredictable career. Prickly, brilliant, willfully eccentric, he
relied more on instinct than business plans. As the eminent economist
John Kenneth Galbraith later said: "If there is any certainty as to
what a businessman is, he is assuredly the things Ford was not."
In the winter of 1906, Ford had secretly partitioned a twelve-by
fifteen-foot room in his plant, on Piquette Avenue in Detroit. With a
few colleagues, he devoted two years to the design and planning of the
Model T. Early on, they made an extensive study of materials, the most
valuable aspect of which began in an offhand way. During a car race in
Florida, Ford examined the wreckage of a French car and noticed that
many of its parts were of lighter-than-ordinary steel. The team on
Piquette Avenue ascertained that the French steel was a vanadium
alloy, but that no one in America knew how to make it. The finest
steel alloys then used in American automaking provided 60,000 pounds
of tensile strength. Ford learned that vanadium steel, which was much
lighter, provided 170,000 pounds of tensile strength. As part of the
pre-production for the new model, Ford imported a metallurgist and
bankrolled a steel mill. As a result, the only cars in the world to
utilize vanadium steel in the next five years would be French luxury
cars and the Ford Model T. A Model T might break down every so
often, but it would not break.
The car that finally emerged from Ford's secret design section at the
factory would change America forever. For $825, a Model T customer
could take home a car that was light, at about 1,200 pounds;
relatively powerful, with a four-cylinder, twenty horsepower engine,
and fairly easy to drive, with a two-speed, foot-controlled
"planetary" transmission. Simple, sturdy, and versatile, the little
car would excite the public imagination. It certainly fired up its
inventor: when Henry Ford brought the prototype out of the factory for
its first test drive, he was too excited to drive. An assistant had to
take the wheel.
"Well, I guess we've got started," Ford observed at the time. The car
went to the first customers on October 1, 1908. In its first year,
over ten thousand were sold, a new record for an automobile
model. Sales of the "Tin Lizzie," or "flivver," as the T was known,
were boosted by promotional activities ranging from a black-tie "Ford
Clinic" in New York, where a team of mechanics showcased the car, to
Model T rodeos out west, in which cowboys riding in Fords tried to
rope calves. In 1909, mining magnate Robert Guggenheim sponsored an
auto race from New York to Seattle in which the only survivors were
two Model T Fords. "I believe Mr. Ford has the solution of the popular
automobile," Guggenheim concluded.
In the early years, Model Ts were produced at Piquette Avenue in much
the same way that all other cars were built. Growing demand for the
new Ford overwhelmed the old method, though. Ford realized that he not
only had to build a new factory, but a new system within that factory.
Throughout his tenure as the head of the company, Henry Ford believed
in maintaining enormous cash reserves, a policy that allowed him to
plan a new facility for production of the Model T without interference
or outside pressure. The new Highland Park factory, which opened in
1910, was designed by the nation's leading industrial architect,
Albert Kahn. It was unparalleled in scale, sprawling over sixty-two
acres. John D. Rockefeller, whose Standard Oil refineries had always
represented state-of-the-art design, called Highland Park "the
industrial miracle of the age."
In its first few years, the four-story Highland Park factory was
organized from top to bottom. Assembly wound downward, from the fourth
floor, where body panels were hammered out, to the third floor, where
workers placed tires on wheels and painted auto bodies. After assembly
was completed on the second floor, new automobiles descended a final
ramp past the first-floor offices. Production increased by
approximately 100 percent in each of the first three years, from
19,000 in 1910, to 34,500 in 1911, to a staggering 78,440 in 1912. It
was still only a start.
"I'm going to democratize the automobile," Henry Ford had said in
1909. "When I'm through, everybody will be able to afford one, and
about everybody will have one." The means to this end was a continuous
reduction in price. When it sold for $575 in 1912, the Model T for the
first time cost less than the prevailing average annual wage in the
United States. Ignoring conventional wisdom, Ford continually
sacrificed profit margins to increase sales. In fact, profits per car
did fall as he slashed prices from $220 in 1909 to $99 in 1914. But
sales exploded, rising to 248,000 in 1913. Moreover, Ford demonstrated
that a strategic, systematic lowering of prices could boost profits,
as net income rose from $3 million in 1909 to $25 million in 1914. As
Ford's U.S. market share rose from a respectable 9.4 percent in 1908
to a formidable 48 percent in 1914, the Model T dominated the world's
leading market.
At Highland Park, Ford began to implement factory automation in
1910. But experimentation would continue every single day for the next
seventeen years, under one of Ford's maxims: "Everything can always be
done better than it is being done." Ford and his efficiency experts
examined every aspect of assembly and tested new methods to increase
productivity. The boss himself claimed to have found the inspiration
for the greatest breakthrough of all, the moving assembly line, on a
trip to Chicago: "The idea came in a general way from the overhead
trolley that the Chicago packers use in dressing beef," Ford said. At
the stockyards, butchers removed certain cuts as each carcass passed
by, until nothing was left. Ford reversed the process. His use of the
moving assembly line was complicated by the fact that parts, often
made on sub-assembly lines, had to feed smoothly into the
process. Timing was crucial: a clog along a smaller line would slow
work farther along. The first moving line was tested with assembly of
the flywheel magneto, showing a saving of six minutes, fifty seconds
over the old method. As similar lines were implemented throughout
Highland Park, the assembly time for a Model T chassis dropped from
twelve hours, thirty minutes to five hours, fifty minutes.
The pace only accelerated, as Ford's production engineers experimented
with work slides, rollways, conveyor belts, and hundreds of other
ideas. The first and most effective assembly line in the automobile
industry was continually upgraded. Those most affected were, of
course, the workers. As early as January 1914, Ford developed an
"endless chain-driven" conveyor to move the chassis from one
workstation to another; workers remained stationary. Three months
later, the company created a "man high" line -- with all the parts and
belts at waist level, so that workers could repeat their assigned
tasks without having to move their feet.
In 1914, 13,000 workers at Ford made 260,720 cars. By comparison, in
the rest of the industry, it took 66,350 workers to make
286,770. Critics charged that the division of the assembly process
into mindless, repetitive tasks turned most of Ford's employees into
unthinking automatons, and that manipulation of the pace of the line
was tantamount to slave driving by remote control. The men who made
cars no longer had to be mechanically inclined, as in the earlier
days; they were just day laborers. Ford chose to see the bigger
picture of the employment he offered. "I have heard it said, in fact,
I believe it's quite a current thought, that we have taken skill out
of work," he said. "We have not. We have put a higher skill into
planning, management, and tool building, and the results of that skill
are enjoyed by the man who is not skilled."
But the unskilled workers, many of them foreign born, didn't enjoy
their work, earning a mediocre $2.38 for a nine-hour day. Indeed, the
simplification of the jobs created a treacherous backlash: high
turnover. Over the course of 1913, the company had to hire 963 workers
for every 100 it needed to maintain on the payroll. To keep a
workforce of 13,600 employees in the factory, Ford continually spent
money on short-term training. Even though the company introduced a
program of bonuses and generous benefits, including a medical clinic,
athletic fields, and playgrounds for the families of workers, the
problem persisted. The rest of the industry reluctantly accepted high
turnover as part of the assembly-line system and passed the increasing
labor costs into the prices of their cars. Henry Ford, however, did
not want anything in the price of a Model T except good value. His
solution was a bold stroke that reverberated through the entire
nation.
On January 5, 1914, Henry Ford announced a new minimum wage of five
dollars per eight-hour day, in addition to a profit-sharing plan. It
was the talk of towns across the country; Ford was hailed as the
friend of the worker, as an outright socialist, or as a madman bent on
bankrupting his company. Many businessmen -- including most of the
remaining stockholders in the Ford Motor Company -- regarded his
solution as reckless. But he shrugged off all the criticism: "Well,
you know when you pay men well you can talk to them," he
said. Recognizing the human element in mass production, Ford knew that
retaining more employees would lower costs, and that a happier work
force would inevitably lead to greater productivity. The numbers bore
him out. Between 1914 and 1916, the company's profits doubled from $30
million to $60 million. "The payment of five dollars a day for an
eight-hour day was one of the finest cost-cutting moves we ever made,"
he later said.
There were other ramifications, as well. A budding effort to unionize
the Ford factory dissolved in the face of the Five-Dollar Day. Most
cunning of all, Ford's new wage scale turned autoworkers into auto
customers. The purchases they made returned at least some of those
five dollars to Henry Ford, and helped raise production, which
invariably helped to lower per-car costs.
The central role that the Model T had come to play in America's
cultural, social and economic life elevated Henry Ford into a
full-fledged folk hero. But Ford wasn't satisfied. Fancying himself a
political pundit and all-around sage, he allowed himself to be drawn
into national and even world affairs. Before the United States entered
World War I, he despaired with many others over the horrors of the
fighting; late in 1915, he chartered a "Peace Ship" and sailed with a
private delegation of radicals for France in a native attempt to end
the war. In 1918, he lost a campaign for a U.S. Senate seat. The
following year, he purchased a newspaper, the Dearborn
Independent, which was to become the vehicle for his notorious
anti-Semitism. The newspaper railed against the International Jew, and
reported scurrilous conspiracy theories such as The Protocols of
the Elders of Zion.
In 1915, James Couzens resigned from the Ford Motor Company,
recognizing that it Henry's company, and that no one else's opinion
would ever matter as much. In 1916, Ford antagonized the other
shareholders by declaring a paltry dividend, even in the face of
record profits. In response, the shareholders sued, and in 1919 the
Michigan Supreme Court upheld a lower court ruling that it was
unreasonable to withhold fair dividends under the circumstances. The
Ford Motor Company was forced to distribute $19 million in dividend
payments. In his own response to the escalating feud, Henry threatened
publicly to leave the company and form a new one. He even made plans
and discussed the next car he would produce.
Fearing that the worth of Ford stock would plummet, the minority
shareholders suddenly became eager to sell; agents working
surreptitiously for Henry Ford quietly bought up lot after lot of
shares. The sellers did not receive all that the shares were worth,
because of the rumors, but they each emerged with a fortune. James
Couzens, the most wily of the lot, received the highest price per
share, and turned to a career in the U.S. Senate (he won his race,
unlike the old boss) with $30 million in the bank. Ford gained
complete control of the company at a cost of $125 million -- $106
million of the stock, plus $19 million for the court-ordered dividend
-- a fantastic outlay that he financed with a $75 million loan from
two eastern banks. On July 11, 1919, when he signed the last stock
transfer agreement, the fifty-five-year-old mogul was so enthused that
he danced a jig. The stock was divided up and placed in the names of
Henry, Clara, and Edsel Ford.
In 1921, the Model T Ford held 60 percent of the new-car
market. Plants around the world turned out flivvers as though they
were subway tokens, and Henry Ford's only problem, as he often stated
it, was figuring out how to make enough of them. As a concession to
diversification, he purchased the Lincoln Motor Car Company in
1921. Company plans seemed to be in place for a long, predictable
future and Ford was free to embark on a great new project: the design
and construction of the world's largest and most efficient automobile
factory at River Rouge, near Detroit. Arrayed over 2,000 acres, it
would include 90 miles of railroad track and enough space for 75,000
employees to produce finished cars from raw material in the span of
just forty-one hours. River Rouge had its own power plant, iron
forges, and fabricating facilities. No detail was overlooked:
wastepaper would be recycled into cardboard at the factory's own paper
mill. River Rouge was built to produce Model T Fords for decades to
come, by the time it was capable of full production later in the
decade, a factory a tenth its size could have handled the demand for
Model Ts.
The Model T's Ride Comes To An End
On June 4, 1924, the ten millionth Model T Ford left the Highland Park
factory, which would remain the main facility for T production. While
the flivver outsold its nearest competitor by a six-to-one margin that
year, its unbridled run was nearing an unforeseen conclusion. After
years of conceding the low end of the market to Ford, another
automaker was setting its sights on that very sector.
At the beginning of the decade, General Motors was an awkward
conglomerate of car companies and parts suppliers, managed more for
the sake of its whipsaw stock-price than for efficiencies in
automaking. In the middle of the decade, though, a revitalized GM,
under the brilliant leadership of Alfred P. Sloan, Jr., began to offer
inexpensive Chevrolets with amenities that the Model T lacked. Instead
of the sturdy but antiquated planetary transmission, it had a smooth
three-speed. The market began to shift; price and value ceased to be
paramount factors. Styling and excitement suddenly counted to the
customer. Even though the Model T cost a mere $290 in the
mid-twenties, dealers clamored for a new Ford that would strike the
fancy of the more demanding and sophisticated consumers.
But Henry Ford refused even to consider replacing his beloved Model
T. Once, while he was away on vacation, employees built an updated
Model T and surprised him with it on his return. Ford responded by
kicking in the windshield and stomping on the roof. "We got the
message," one of the employees said later, "As far as he was
concerned, the Model T was god and we were to put away false images."
Only one person persisted in warning him of the impending crisis: his
son, Edsel, who had been installed as president of the Ford Motor
Company during the dividend trial and its aftermath in 1919. It was
the first of many arguments that Edsel would lose, as the once adoring
relationship between the two deteriorated into distrust and disrespect
on Henry's part and woeful disillusionment on Edsel's.
The Chevrolet continued to take sales from the dour Model T. By 1926,
T sales had plummeted, and the realities of the marketplace finally
convinced Henry Ford that the end was at hand. On May 25, 1927, Ford
abruptly announced the end of production for the Model T, and soon
after closed the Highland Park factory for six months. The shutdown
was not for retooling: there was no new model in the works. In
history's worst case of product planning, Henry sent the workers home
so that he could start to design his next model. Fortunately, Edsel
had been quietly marshaling sketches from the company's designers, and
he was ready and able to work with his father on producing plans for
the new car, called the Model A. It was a success from its launch in
December 1927, and placed the company on sound footing again. By the
time it went into production, the River Rouge had become the main Ford
manufacturing facility.
When the last Model T rolled off the assembly line, it was not the end
of an era, it was still the very dawn of the one that the little car
had inaugurated. Cars -- more than half of them Model Ts -- pervaded
American culture. They jammed the streets of the great eastern cities
and roamed newly laid roads in southern California. Adapted to haul
everything from mail to machine guns to coffins to schoolchildren,
automobiles represented an opportunity for change in practically
everything. They also became a crucial factor in recasting a growing
economy. Henry Ford had created a car for the multitudes and that car
had created the basis of the car culture embraced by every subsequent
generation.
The Ford Motor Company, having survived its own crisis in the
twenties, was one of only forty-four U.S. automakers left in 1929, out
of the hundreds that had entered the fray since the beginning of the
century. That year, Ford, General Motors, and the newly formed
Chrysler Corporation -- known then and now as the Big Three --
accounted for 80 percent of the market.
Henry Ford died on April 7, 1947, at the age of eighty-three, having
outlived the Model T by nearly twenty years. A century has passed
since he took the first car he built for a ride. The world remains in
large part the one set into motion by Henry Ford: a world in which
cars are for everyone. As Will Rogers said, "It will take a hundred
years to tell whether he helped us or hurt us, but he certainly didn't
leave us where he found us."