• son of a Dearborn farmer, but with a talent for mechanics that led him to a series of engineering jobs before he got into automobiles
• In 1896 Ford was chief engineer of the Edison Illuminating Co. (now Detroit Edison).
• In that year he built a car called the Quadricycle and started looking for backers to produce it commercially (he later claimed to have built a car in 1892 but there is no evidence for that but Ford's claims).

 Ford's Quadricycle

• in 1899 he found a group of businessmen to support him, but they got impatient that he was building cars for automobile racing (which he thought was critical publicity) rather than concentrating on setting up commercial production.  Ford and his backers parted ways in 1902 and his former backers found another engineer, Henry M. Leland, who gave the company a new name--Cadillac--and got it into commercial production.

• Ford started the Ford Motor Company in 1903 with a new set of backers.
• The Dodge brothers became stockholders in return for providing chassis, engines, and transmissions for the first Ford cars.
• Ford initially made medium-priced cars--$1000-$1500.
• by 1910 the industry was consolidating painfully
• General Motors was about to go under under excessive debt and was saved only by new investors who advanced cash on very harsh terms (6% interest plus a 17% commission).
• many of the smaller companies went bankrupt, and even the larger ones were better at finance than at solving technological problems.
• a number of makers were thinking about low cost cars (an idea that was not tried in Europe until after its success in America).  One notable example after the curved dash Oldsmobile was the Brush Runabout, which sold for $500 and had 10 HP and all-wood construction.  It didn't hold up very well.
• the key invention of this period was the electric starter
• It was invented by Henry M. Leland and Charles F. Kettering.  Leland became interested in the problem because a friend of his had died in a bizarre accident.  He went to the assistance of a lady whose car had stalled, and when he turned the crank to start it the crank handle kicked back and broke his jaw.  He died of the resulting gangrene.
• the electric starter meant that women and older men could drive cars

Ford's assembly-line revolution (more on Ford as a businessman)

• Ford first designed a mass market car and then studied how to cut costs in production.  Mass market meant not only low cost but sturdy, easy to operate, and easy to repair.  Ford was one of the first to use alloy steel in America.

Ford's engineers may have had the idea for the assembly line as early as 1908, but they didn't want to delay introduction of the model T to implement it.  The Model T was the first low cost ($825-$850) high power (20 HP) car, also light (about 1,200 pounds) and fairly easy to drive, with a two-speed, foot-controlled "planetary" transmission.  It was immediately very popular--compared to cars costing $2000.  Ford decided in 1909 to produce nothing else.

 Model T

• Ford's business manager had calculated that to really hit the mass market the price had to be brought down to $600, and that could not be done with existing production methods.
• between 1913 and 1914 conveyer belts were introduced throughout the factory
• time required to assemble the chassis fell from 12 hours 30 minutes to 2 hours 40 minutes, and then by 1914 to 1 1/2 hours
• price of Model T dropped to $360 by 1916 and to $290 by 1927 (its last year of production).  577,000 sold in 1916.  Within a decade all automobile manufacturers were using the assembly line.

Ford assembly line and Diego Rivera painting (Detroit Institute of Arts)

• now Ford could hire unskilled workers

• He paid average wages: $2.38 for a nine hour day.  Workers hated the assembly line and turnover reached over 300%
• in 1914 Ford began to offer selected workers $5 a day and an eight hour day--about twice the going rate in Detroit at the time.  At one point fire hoses had to be used to disperse the mob of applicants around the Highland Park plant.
• Between 1914 and 1916, the company's profits doubled from $30 million to $60 million.
• Ford did believe that the gains made by improving techniques of production should be passed on to society in three ways--to stockholders through dividends, to consumers through lower prices, and to labor through higher wages.  He understood that the worker was also a consumer.  He wasn't fond of stockholders, particularly after the Dodge brothers set themselves up as competitors.  In fact in 1916 (a year with record profits) he paid such low dividends that stockholders sued and won. Ford quotes

 Model T Automobile Plant

• gave more responsibility to production divisions--decentralized organization
• General Motors made cars for different markets (from Chevrolet at the bottom to Cadillac at the top) and pioneered the annual model change and a choice of colors.  Worked out close relations with dealers.  Consumers began to look for styling and excitement, not the lowest possible price.
• Ford made the Model T until 1927--15 million of them--nearly driving the company into bankruptcy.  Finally when he had to face reality and shut down Model T production he didn't have a new model designed yet.

 1927 Chevrolet