Henry Ford spent most of his life making headlines, good, bad, but never indifferent. Celebrated as both a technological genius and a folk hero, Ford was the creative force behind an industry of unprecedented size and wealth that in only a few decades permanently changed the economic and social character of the United States. When young Ford left his father's farm in 1879 for Detroit, only two out of eight Americans lived in cities; when he died at age 83, the proportion was five out of eight. Once Ford realized the tremendous part he and his Model T automobile had played in bringing about this change, he wanted nothing more than to reverse it, or at least to recapture the rural values of his boyhood. Henry Ford, then, is an apt symbol of the transition from an agricultural to an industrial America.
Early life. Henry Ford was one of eight children of William and Mary Ford. He was born on the family farm near Dearborn, Michigan, then a town eight miles west of Detroit, on July 30, 1863. Abraham Lincoln was president of the 24 states of the Union, and Jefferson Davis was president of the 11 states of the Confederacy. Ford attended a one-room school for eight years when he was not helping his father with the harvest. At age 16 he walked to Detroit to find work in its machine shops. After three years, during which he came in contact with the internal-combustion engine for the first time, he returned to the farm, where he worked part-time for the Westinghouse Engine Company and in spare moments tinkered in a little machine shop he set up. Eventually he built a small "farm locomotive," a tractor that used an old mowing machine for its chassis and a homemade steam engine for power.
Ford moved back to Detroit nine years later as a married man. His wife, Clara Bryant, had grown up on a farm not far from Ford's. They were married in 1888, and on November 6, 1893, she gave birth to their only child, Edsel Bryant. A month later Ford was made chief engineer at the main Detroit Edison Company plant with responsibility for maintaining electric service in the city 24 hours a day. Because he was on call at all times, he had no regular hours and could experiment to his heart's content. He had determined several years before to build a gasoline-powered vehicle, and his first working gasoline engine was completed at the end of 1893. By 1896 he had completed his first horseless carriage, the "Quadricycle," so called because the chassis of the four-horsepower vehicle was a buggy frame mounted on four bicycle wheels. Unlike many other automotive inventors, including Charles Edgar and J. Frank Duryea, Elwood Haynes, Hiram Percy Maxim, and his Detroit acquaintance Charles Brady King, all of whom had built self-powered vehicles before Ford but who held onto their creations, Ford sold his to finance work on a second vehicle, and a third, and so on.
During the next seven years he had various backers, some of whom, in 1899, formed the Detroit Automobile Company (later the Henry Ford Company), but all eventually abandoned him in exasperation because they wanted a passenger car to put on the market while Ford insisted always on improving whatever model he was working on, saying that it was not ready yet for customers. He built several racing cars during these years, including the "999" racer driven by Barney Oldfield, and set several new speed records. In 1902 he left the Henry Ford Company, which subsequently reorganized as the Cadillac Motor Car Company. Finally, in 1903, Ford was ready to market an automobile. The Ford Motor Company was incorporated, this time with a mere $28,000 in cash put up by ordinary citizens, for Ford had, in his previous dealings with backers, antagonized the wealthiest men in Detroit.
The company was a success from the beginning, but just five weeks after its incorporation the Association of Licensed Automobile Manufacturers threatened to put it out of business because Ford was not a licensed manufacturer. He had been denied a license by this group, which aimed at reserving for its members the profits of what was fast becoming a major industry. The basis of their power was control of a patent granted in 1895 to George Baldwin Selden, a patent lawyer of Rochester, New York. The association claimed that the patent applied to all gasoline-powered automobiles. Along with many rural Midwesterners of his generation, Ford hated industrial combinations and Eastern financial power. Moreover, Ford thought the Selden patent preposterous. All invention was a matter of evolution, he said, yet Selden claimed genesis. He was glad to fight, even though the fight pitted the puny Ford Motor Company against an industry worth millions of dollars. The gathering of evidence and actual court hearings took six years. Ford lost the original case in 1909; he appealed and won in 1911. His victory had wide implications for the industry, and the fight made Ford a popular hero.
"I will build a motor car for the great multitude," Ford proclaimed in announcing the birth of the Model T in October 1908. In the 19 years of the Model T's existence, he sold 15,500,000 of the cars in the United States, almost 1,000,000 more in Canada, and 250,000 in Great Britain, a production total amounting to half the auto output of the world. The motor age arrived owing mostly to Ford's vision of the car as the ordinary man's utility rather than as the rich man's luxury. Once only the rich had travelled freely around the country; now millions could go wherever they pleased. The Model T was the chief instrument of one of the greatest and most rapid changes in the lives of the common people in history, and it effected this change in less than two decades. Farmers were no longer isolated on remote farms. The horse disappeared so rapidly that the transfer of acreage from hay to other crops caused an agricultural revolution. The automobile became the main prop of the American economy and a stimulant to urbanization--cities spread outward, creating suburbs and housing developments--and to the building of the finest highway system in the world.
The remarkable birth rate of Model T's was made possible by the most advanced production technology yet conceived. After much experimentation by Ford and his engineers, the system that had evolved by 1913-14 in Ford's new plant in Highland Park, Michigan, was able to deliver parts, subassemblies, and assemblies (themselves built on subsidiary assembly lines) with precise timing to a constantly moving main assembly line, where a complete chassis was turned out every 93 minutes, an enormous improvement over the 728 minutes formerly required. The minute subdivision of labour and the coordination of a multitude of operations produced huge gains in productivity.
In 1914 the Ford Motor Company announced that it would henceforth pay eligible workers a minimum wage of $5 a day (compared to an average of $2.34 for the industry) and would reduce the work day from nine hours to eight, thereby converting the factory to a three-shift day. Overnight Ford became a worldwide celebrity. People either praised him as a great humanitarian or excoriated him as a mad socialist. Ford said humanitarianism had nothing to do with it. Previously profit had been based on paying wages as low as workers would take and pricing cars as high as the traffic would bear. Ford, on the other hand, stressed low pricing (the Model T cost $950 in 1908 and $290 in 1927) in order to capture the widest possible market and then met the price by volume and efficiency. Ford's success in making the automobile a basic necessity turned out to be but a prelude to a more widespread revolution. The development of mass-production techniques, which enabled the company eventually to turn out a Model T every 24 seconds; the frequent reductions in the price of the car made possible by economies of scale; and the payment of a living wage that raised workers above subsistence and made them potential customers for, among other things, automobiles--these innovations changed the very structure of society.
Control of the company. During its first five years the Ford Motor Company produced eight different models, and by 1908 its output was 100 cars a day. The stockholders were ecstatic; Ford was dissatisfied and looked toward turning out 1,000 a day. The stockholders seriously considered court action to stop him from using profits to expand. In 1909 Ford, who owned 58 percent of the stock, announced that he was only going to make one car in the future, the Model T. The only thing the minority stockholders could do to protect their dividends from his all-consuming imagination was to take him to court, which Horace and John Dodge did in 1916.
The Dodge brothers, who formerly had supplied chassis to Ford but were now manufacturing their own car while still holding Ford stock, sued Ford for what they claimed was his reckless expansion and for reducing prices of the company's product, thereby diverting money from stockholders' dividends. The court hearings gave Ford a chance to expound his ideas about business. In December 1917 the court ruled in favour of the Dodges; Ford, as in the Selden case, appealed, but this time he lost. In 1919 the court said that, while Ford's sentiments about his employees and customers were nice, a business is for the profit of its stockholders. Ford, irate that a court and a few shareholders, whom he likened to parasites, could interfere with the management of his company, determined to buy out all the shareholders. He had resigned as president in December 1918 in favour of his son, Edsel, and in March 1919 he announced a plan to organize a new company to build cars cheaper than the Model T. When asked what would become of the Ford Motor Company, he said, "Why I don't know exactly what will become of that; the portion of it that does not belong to me cannot be sold to me, that I know." The Dodges, somewhat inconsistently, having just taken him to court for mismanagement, vowed that he would not be allowed to leave. Ford said that if he was not master of his own company, he would start another. The ruse worked; by July 1919 Ford had bought out all seven minority stockholders. (The seven had little to complain about: in addition to being paid nearly $106,000,000 for their stock, they received a court-ordered dividend of $19,275,385 plus $1,536,749 in interest.) Ford Motor Company was reorganized under a Delaware charter in 1920 with all shares held by Ford and other family members. Never had one man controlled so completely a business enterprise so gigantic.
The planning of a huge new plant at River Rouge, Michigan, had been one of the specific causes of the Dodge suit. What Ford dreamed of was not merely increased capacity but complete self-sufficiency. World War I, with its shortages and price increases, demonstrated for him the need to control raw materials; slow-moving suppliers convinced him that he should make his own parts. Wheels, tires, upholstery, and various accessories were purchased from other companies around Detroit. As Ford production increased, these smaller operations had to speed their output; most of them had to install their own assembly lines. It became impossible to coordinate production and shipment so that each product would arrive at the right place and at the right time. At first he tried accumulating large inventories to prevent delays or stoppages of the assembly line, but he soon realized that stockpiling wasted capital. Instead he took up the idea of extending movement to inventories as well as to production. He perceived that his costs in manufacturing began the moment the raw material was separated from the earth and continued until the finished product was delivered to the consumer. The plant he built in River Rouge embodied his idea of an integrated operation encompassing production, assembly, and transportation. To complete the vertical integration of his empire, he purchased a railroad, acquired control of 16 coal mines and about 700,000 (285,000 hectares) acres of timberland, built a sawmill, acquired a fleet of Great Lakes freighters to bring ore from his Lake Superior mines, and even bought a glassworks.
The move from Highland Park to the completed River Rouge plant was accomplished in 1927. At 8 o'clock any morning, just enough ore for the day would arrive on a Ford freighter from Ford mines in Michigan and Minnesota and would be transferred by conveyor to the blast furnaces and transformed into steel with heat supplied by coal from Ford mines in Kentucky. It would continue on through the foundry molds and stamping mills and exactly 28 hours after arrival as ore would emerge as a finished automobile. Similar systems handled lumber for floorboards, rubber for tires, and so on. At the height of its success the company's holdings stretched from the iron mines of northern Michigan to the jungles of Brazil, and it operated in 33 countries around the globe. Most remarkably, not one cent had been borrowed to pay for any of it. It was all built out of profits from the Model T.
Later years. The unprecedented scale of that success, together with Ford's personal success in gaining absolute control of the firm and driving out subordinates with contrary opinions, set the stage for decline. Trusting in what he believed was an unerring instinct for the market, Ford refused to follow other automobile manufacturers in offering such innovative features as conventional gearshifts (he held out for his own planetary gear transmission), hydraulic brakes (rather than mechanical ones), six- and eight-cylinder engines (the Model T had a four), and choice of colour (from 1914 every Model T was painted black). When he was finally convinced that the marketplace had changed and was demanding more than a purely utilitarian vehicle, he shut down his plants for five months to retool. In December 1927 he introduced the Model A. The new model enjoyed solid but not spectacular success. Ford's stubbornness had cost him his leadership position in the industry; the Model A was outsold by General Motors' Chevrolet and Chrysler's Plymouth and was discontinued in 1931. Despite the introduction of the Ford V-8 in 1932, by 1936 Ford Motor Company was third in sales in the industry.
A similar pattern of authoritarian control and stubbornness marked Ford's attitude toward his workers. The $5 day that brought him so much attention in 1914 carried with it, for workers, the price of often overbearing paternalism. It was, moreover, no guarantee for the future; in 1929 Ford instituted a $7 day, but in 1932, as part of the fiscal stringency imposed by falling sales and the Great Depression, that was cut to $4, below prevailing industry wages. Ford freely employed company police, labour spies, and violence in a protracted effort to prevent unionization and continued to do so even after General Motors and Chrysler had come to terms with the United Automobile Workers. When the UAW finally succeeded in organizing Ford workers in 1941, he considered shutting down before he was persuaded to sign a union contract.
During the 1920s, under Edsel Ford's nominal presidency, the company diversified by acquiring the Lincoln Motor Car Company, in 1922, and venturing into aviation. At Edsel's death in 1943 Henry Ford resumed the presidency and, in spite of age and infirmity, held it until 1945, when he retired in favour of his grandson, Henry Ford II.
Henry Ford was a complex personality. Away from the shop floor he exhibited a variety of enthusiasms and prejudices and, from time to time, startling ignorance. His dictum that "history is more or less bunk" was widely publicized, as was his deficiency in that field revealed during cross-examination in his million-dollar libel suit against the Chicago Tribune in 1919; a Tribune editorial had called him an "ignorant idealist" because of his opposition to U.S. involvement in World War I, and while the jury found for Ford it awarded him only six cents. One of Ford's most publicized acts was his chartering of an ocean liner to conduct himself and a party of pacifists to Europe in November 1915 in an attempt to end the war by means of "continuous mediation." The so-called Peace Ship episode was widely ridiculed. In 1918, with the support of Pres. Woodrow Wilson, Ford ran for a U.S. Senate seat from Michigan. He was narrowly defeated after a campaign of personal attacks by his opponent.
In 1918 Ford bought a newspaper, The Dearborn Independent, and in it published a series of scurrilous attacks on the "International Jew," a mythical figure he blamed for financing war; in 1927 he formally retracted his attacks and sold the paper. He gave old-fashioned dances at which capitalists, European royalty, and company executives were introduced to the polka, the Sir Roger de Coverley, the mazurka, the Virginia reel, and the quadrille; he established small village factories; he built one-room schools in which vocational training was emphasized; he experimented with soybeans for food and durable goods; he sponsored a weekly radio hour on which quaint essays were read to "plain folks"; he constructed Greenfield Village, a restored rural town; and he built what later was named the Henry Ford Museum and filled it with American artifacts and antiques from the era of his youth when American society was almost wholly agrarian. In short, he was a man who baffled even those who had the opportunity to observe him close at hand, all except James Couzens, Ford's business manager from the founding of the company until his resignation in 1915, who always said, "You cannot analyze genius and Ford is a genius."
Ford died at home on April 7, 1947, exactly 100 years after his father had left Ireland for Michigan. His holdings in Ford stock went to the Ford Foundation, which had been set up in 1936 as a means of retaining family control of the firm and which subsequently became the richest private foundation in the world.
To fordize: to standardize a product and manufacture it by mass means at a price so low that the common man could afford to buy it.
1. Taylorism (after Frederick Winslow Taylor): the application of segmentation and "time-and-motion" studies to the production process.
2. the line: developing the production process "like a river and its tributaries."
3. the conveyer belt: adopting the Chicago meatpackers overhead trolley to auto production. 1914: Ford installs first automatic conveyer belt.
* 1910-11: $780 * 1911-12: $690 * 1912-13: $600 * 1913-14: $550. * 1914-15: $360.
In 1914 the Ford Motor Company with 13,000 employees produced 267,720 cars; the other 299 American auto companies with 66,350 workers produced only 286,770 cars. Ford had 48% of US car market, Company has $100 million in annual sales.
THE ROUGE RIVER PLANT.
* "Ford's industrial masterpiece." Opened 1918 and reaches full capacity by mid-1920s.
* 1.5 miles long by .75 miles wide. A steel, glass, auto plant all in one.
* "Here is the conversion of raw materials into cash in approximately 33 hours.
In 1913 the labor turnover at Ford was 380%! Solution (1914): $5 a day (double existing pay) A successful public-relations gesture; "the smartest cost-cutting move I ever made."
Ford's Sociology Department: a spying dept that fired employees if they had union sympathies, had personal problems in finance or health, gambled, got drunk.
1922: high point for Ford's sales.
1. stagnant technology: refusal to change basic Model T technology until too late. Model A introduced 1927.
2. poor management: the practioner of social darwinism; no standardized accounting system; contempt for workers. Hosti
3. cronyism & gangsterism: association with dubious "yes-men." Harry Bennett's truncheons and guns.
4. Soressen joins GM. Edsel Ford undermined.
5. Increasing eccentricity.
6. Plant floor run by intimidation not cooperation
FAMOUS FORD QUOTES.
"Every time I reduce the price of the car by one dollar I get one thousand new buyers"
"Buy a Ford - spend the difference."
"A Ford will take you everywhere except into society."
Thinking men know that work is the salvation of the race, morally, physically, socially."
"Men work for two reasons. One is for wages, and one is for fear of losing their jobs."
"Study the history of almost any criminal, and you will find an inveterate cigarette smoker."
"When there is something wrong in this country, you'll find the Jews."
"The Depression is good for the country. The only problem is that it might not last long enough in which case people might not learn enough from it."
(on accountants): "I want them all fired. They're not productive, they don't do any real work. Get them out of here today."
"If there is unemployment in America, it is because the unemployed do not want to work."
Ford was the nominal coauthor of three books in collaboration with SAMUEL CROWTHER: My Life and Work (1922, reprinted 1987), Today and Tomorrow (1926, reprinted 1988), and Moving Forward (1930). Especially recommended studies of his life and activities are ALLAN NEVINS and FRANK ERNEST HILL, Ford: The Times, the Man, the Company (1954), Ford: Expansion and Challenge, 1915-1933 (1957), and Ford: Decline and Rebirth, 1933-1962 (1963); CAROL W. GELDERMAN, Henry Ford: The Wayward Capitalist (1981), a full-length biography and a study of his company's development;WILLIAM GREENLEAF, Monopoly on Wheels (1961), a discussion of the Selden patent case. DAVID L. LEWIS, The Public Image of Henry Ford (1976), examines the media's portrayal of Ford and his company as well as the company's efforts to influence that portrayal.