COMMERCIALIZING THE MOTOR VEHICLE.
In the production of the automobile, America did comparatively little
in the fundamentals of invention which are now found in the modern
perfected car.
Selden invented the three-cylinder gasoline engine, by which the rapid
revolution of the crankshaft of his day was converted into slower but
higher powered motion of drive wheels.
White invented a generator for steam cars.
Haynes was responsible for a discovery that caused alloy and specially
heat-treated steel to be introduced, and Knight produced a superior
motor.
But these were discoveries, inventions or improvements that were
supplemental and perfecting, not elemental.
It was chiefly the English, the French and the Germans, with the
exception of Evans of Philadelphia, who first conceived the idea of the
horseless carriage, and helped it to its final development by a series
of successive inventions. The names of Cugnot, Trevithick, James,
Pecqueur, Hancock, Gurney, Lenoir, Bollee, Benz, Daimler, Levassor and
Serpollet should form the nomenclative setting of commemorative friezes
on the walls of the grateful motor clubs of the future, as those of
Liszt, Beethoven, Wagner, Gounod, Handel, Massenet, Bach, Mendelssohn,
Grieg and Chopin take honored place in the shrines of Music, the
“heavenly maid.”
Even in the production of automobiles in any quantity for use—the
commercializing of the idea they represent—the United States did not
lead at first. This honor belongs to France, as does the original
conception by Cugnot of the horseless vehicle.
The first steam cars manufactured in the United States, on any basis
entitling their manufacture to the dignity of a business, were made
after 1894, and the names of Riker, White and Stanley are the prominent
ones in the steam automobile field. Electric carriages were sold as
commercial commodities in comparatively small quantities, beginning
with 1897, and the first American gasoline car sold in the United
States was made and sold by Alexander Winton in 1898.
Beginning prior to 1892, the French were selling automobiles by the
hundred, while manufacturers in America were selling them by the dozen.
Panhard and Peugeot were selling gasoline cars, and DeDion-Bouton was
putting the steam automobile on the world’s market.
But the race is not always to the swiftest. While France started
bravely on its commercialization of the automobile, and had in its
favor what were then good roads of an old and well settled country to
run them over, and perhaps the thriftiest people of any nation to buy
them, there were causes existing in the United States destined to make
of it the greatest automobile producing country in the world, and its
people the largest users of the new invention, while at the same time
operating to cause the United States to sell more cars outside its
confines, to Europe and elsewhere, than are sold by any other country.
And inasmuch as these underlying causes, while explaining the
supremacy of this country to this date in the manufacture and sale of
automobiles, also explain the reason for believing that the future of
the automobile business will dwarf the proportions it has up to this
time reached, they will bear analysis.
In the first place, European manufacturers of automobiles, as well as
of other products generally, with the possible exception in a degree,
of the Germans, are bound hand and foot, and therefore handicapped,
by tradition and convention. They make the automobile, especially the
French and English, so solidly, with such fidelity to tradition and
with such conscientious care as to detail, elaboration and finish,
that the price to the buyer, when it is put beside that of a similar
American made product, will not meet competition.
The American has a knack of turning out an article which is
mechanically correct, has the wearing qualities, but is simpler in
detail, and hence can be sold at a lower cost. Simplicity is the
American manufacturer’s keynote.
Back of this is business organization system, standardization of
parts used in the automobile, and that high order of constructive and
executive talent that gives the American business man the distinctive
reputation he enjoys and enables him successfully to compete in
price and quality with the rest of the world. There has been a rare
combination of inventive and business abilities in American automobile
manufacturers.
American mechanical genius has been given great credit, but wherein
is it any greater than that of the German, French or English? In one
particular—its simplicity. The Europeans are elaborate—the Americans
plain and simple.
It is possible that no European manufacturer would have conceived an
automobile embodying the essentials of small size, simplicity and
speed represented by a Ford car. His tradition and training would have
impelled him to elaboration in size and finish. In this, he is, of
course, moulded by European needs and tastes which differ, in many
respects, from those of the people of this country.
He does not possess the American’s practical vision in successful
salesmanship. Ford made his car with an eye to quantity. He was not
only an inventor, but a salesman. As he worked on his motor, he worked
on the problems of sales—producing a car that would sell to the largest
number. The larger the number sold, the smaller the price could be made.
“Large sales and small profits” has been a principle which has made
many American fortunes. Note how this same idea of Ford has been
followed by Willys in the Overland, Olds in the Reo, the makers of the
Maxwell, and half a score of other manufacturers in varying degrees,
causing the gamut of prices of the most popular cars to run from $360
to $1,200 each.
This is one reason why the American car could invade England and her
dominions beyond the seas, why Ford has factories in the British Isles
and Canada, and why our yearly exports of automobiles have increased in
the last five years over $100,000,000 in value.
Other reasons that make us an exporting country of automobiles through
their low prices are our natural resources of iron, steel, lumber, coal
and alloys, enabling us, by their plentifulness and accessibility, to
manufacture at cheap cost, thus offsetting the higher price we pay for
labor in this country than the European manufacturers pay.
But the biggest factor in the lead which the United States has taken
in the production of automobiles, both for export and consumption
within her own borders, is the universal method of standardizing in
manufacture, adopted by the automobile producers of the nation.
The manufacturers of this country shine in the field of cost
production, in the economies of purchase of raw materials, in the
method of manufacture, and in marketing their product.
ADVERTISING’S HELP IN MAKING THE AUTOMOBILE.
The extent to which economic methods of purchase of raw
materials—getting the price down—economic standardization of
manufacture, inventing short cuts as it were—affects production cost,
is shown in the fact that the automobile industry ranks almost at the
top in the manufactures of the United States in the per cent of value
added by manufacture to the cost of material.
The per cent of value added by manufacture to cost of material in
automobile production is 71 per cent, against 66 per cent in cotton
goods, 55 per cent in iron and steel products, 51 per cent in boots
and shoes, 16 per cent in flour and grist mill products, and 12 per
cent in slaughtering and meat packing.
Strange as it may sound when first stated, advertising is primarily the
base of this result. We know that the first principle of lowered cost
is buying in quantities; that if we buy for 100, the cost for each is
lower than the cost for one; if for 1,000 it is lower than the cost for
each of 100, and so on.
So, when Ford buys the materials for 533,921 cars, which was the
number he sold in 1916, he gets the price of the cost of each of these
more than a half million cars down to a less price than if he bought
material for 1,708 cars, the number he made in 1904, or even 168,220,
the number he made in 1913.
This is patent to any one who ever heard of wholesale and retail prices.
But how did Ford find a sale for 533,921 cars in 1916?
By advertising.
The first thing a manufacturer must do to lower the cost of production
of the single unit is to make in quantities.
How to insure the disposal of that quantity has been the big problem
that American automobile manufacturers have had to solve. The solution
was at hand. It was advertising. The commercializing of automobiles
with the speed and to the extent to which it was done between 1900 and
1917 could not have been successfully accomplished before this period,
because the recognition of the value of advertising had not become
widespread up to that time.
Advertising had gone through a process of development that was as slow
as that of the automobile business. Both arts emerged from darkness
into light at about the same time. Here is evidence that a very bright
and smart set of men engaged in automobile production at the very
outset.
They were mechanical, they were versed in business methods, and they
were conscious of the value of advertising.
This combination of knowledge by the men engaged in it has made the
automobile industry a record breaker in point of the time consumed
in its development. It has made it stand out as unparalleled by any
other industry in this country in the speed with which it progressed
from final experimentation to an established recognized enterprise,
involving mammoth investment of capital and huge profits.
That the automobile business has been the most extensively advertised
business of any in which we are engaged, almost anyone will concede
from knowledge gained from his own observation.
Advertising is like the rainbow—many hued. It may be one form, or
it may be another. It may whisper, or it may shout. We must concede
that the advertising the automobile promoters have done was more
largely of the shouting than the whispering kind. That is not to their
discredit—rather otherwise. The distinct injunction to advertise is
contained in the Bible. It was: “To so let your good work shine that,”
etc., and the people of scriptural days were admonished not to hide
their light under a bushel.
Newspapers are said, somewhat carelessly, to have made the automobile
business. It is not exactly fair to make this statement so sweepingly.
They did for it a good deal more than they did for any other line of
industry, and are still doing it.
They never devoted the space that they gave to the automobile to
railroads, steamboats, the telephone, street railways, oil, lumber,
mining, meat packing, or any other commercial industry. It was not,
necessarily, that the automobile manufacturers, in all cases, asked for
this liberal treatment by the newspapers.
It was that newspapers volunteered it. One started it, and others
followed. The spell which the idea contained in the automobile weaves
over men and women was cast equally over the editors and publishers in
the United States. In recognition of the novelty of the automobile,
they laid liberal offerings of free space on the altar of motordom. Its
peculiar exhilaration penetrated the editorial sanctum, and in this
distinctive exhilaration the automobile has had no parallel except in
golf.
It has been quite generally accepted as an axiom that if you give, you
receive. We see this statement proved in a hundred ways. A pleasant
smile begets a smile. A good deed is matched in kind. No better reason
for this exists, probably, than that it is ingrained in us to hate to
be under obligations to anybody. So when we get a smile we promptly pay
it back and are square, just as we invite to lunch a man who invited us
to lunch. We are very particular about this.
The automobile manufacturers were not lacking in this trait, common
to human nature. When publishers put their stamp of approval on the
motor car and unreservedly threw open their columns to the progress
made in its improvements and production, manufacturers appreciated and
reciprocated.
The result has been that more money has been spent in advertising in
the automobile business in the United States than has been spent in
any other single line of enterprise. Possibly the nearest approach to
it has been patent medicine, or the promotion of various enterprises.
And it has paid—every automobile maker, and every salesman will admit
this as a matter of course. They will admit it because they know it to
be so—a knowledge derived in their own experience.
The psychology of advertising shows that there are two principal things
involved in making advertising profitably productive. One is that it
informs, the other that it persuades. If the mind is informed of what
an automobile is, what it does, and all the advantages and benefits it
confers, it has a basis to work on, and from this working basis it will
evolve conclusions.
The state of the mind in the conclusive stage is fallow field for
persuasive effort.
In the advertising given in this country to the automobile which has
placed millions of motor cars in the ownership of people in the United
States, not counting those exported, the publishers of our journals
have supplied the information, and the manufacturer the persuasion.
It is this double teamwork which, supplementing the business ability
of our manufacturers, has put us in the front rank as automobile
producers. But baldly to say that the newspapers made the automobile
is not giving full credit to the other causes which contribute to our
success in this line of enterprise. It has been a combination of causes
working together which has made the automobile.
UNITED STATES A FERTILE FIELD.
There have been other forms of advertising used in automobile selling,
besides space in publications, and they are forms the value of which
cannot be discounted. “A satisfied customer is the best advertisement”
is one of the oldest slogans of advertising. And it is true. The
automobile manufacturers of the United States know it is true, and have
been guided by it.
Road races, speed and endurance contests, employment of racing drivers
with records, automobile shows, outdoor displays—all have been forms
of advertising employed in the industry, and all have played their
part and exerted their influence to one common end—that of putting the
industry in the United States on the highest pinnacle it has attained
anywhere in the world in seventeen years.
And while full credit must be given the vision and capabilities of the
manufacturers, and the productive value of advertising in all forms,
meed for the results can not be withheld from that element, which, in
the final analysis, makes all things possible—the people, the base and
groundwork on which all successful industrial structures are erected.
All the business ability of all the automobile makers, however great,
and all the advertising, however convincing, that could be written,
could not have made the automobile business of today if the people had
not taken hold of the automobile and put their stamp of approval on it.
“Power of the Press”—what is it but the “Power of the People” expressed
on paper? Power of the People—the force that revolves the world,
revolved the wheels of millions of automobiles, and will go on turning
the wheels of millions more.
The people of the United States supplied the fertile field in which the
American automobile grew and blossomed.
The reason France, although it took the lead in the commercialization
of the motor car, could not hold it in the race with this country is to
be found in the difference between the peoples of the two countries.
France had good roads—has had them as has Europe for hundreds of years.
The French had money—they are the greatest savers in the world.
But if you put your money in rentes or savings banks, you do not spend
it for automobiles or anything else. The reason the French have money
is the reason they do not buy automobiles.
No people in the world have learned, as have Americans, to spend money
to make money. No people in the world take the chances Americans do,
and no people win as the Americans do. In this is found one of many
causes for the commercial success of the automobile in America.
The American is good to himself as is the man of no other nationality.
He is further advanced in general knowledge, mostly gained by
experience through intercommunication with his fellows. His bon
camaraderie is effervescent, giving him opportunities to learn things
denied to the self-restrained European. His school is the broad school
of the world. He doesn’t have to travel to see the world; the world is
in America and comes to him.
So, with the opportunities natural to a new country, with the standards
of living and the mode of thought that they are in the United States,
the 103,000,000 people of continental United States are a market for
automobiles that dwarf the 464,000,000 people of Europe.
What such a market has been during the last decade and a half may be
gathered from the fact that in the last sixteen years the population of
the United States increased at a greater rate than ever in its history.
The increase of the people of the United States in the sixteen years
the automobile industry has been commercialized, was 25,887,904. In the
previous twenty years the increase was 25,838,792.
People without money can not buy automobiles, so what has been the
increase in wealth in the United States in this same period?
In the last twelve years it has been $99,221,764,315.
Staggering, you say? Rather, when you know that the increase in wealth
in the United States in the last twelve years was nearly double the
increase in the twenty years which preceded the last twelve years.
No epoch in the world’s history, therefore, was so favorable as
the period of 1900-1917 for commercializing the automobile. It was
timed just to the moment for quick and dramatic success. The period
was coincident with the high water marks reached in the increase of
population and in the nation’s money-making. Advertising had reached a
stage of development it had not attained before.
STARS IN THEIR COURSES FOUGHT FOR THE AUTOMOBILE.
We must credit enthusiasm for some of the influence in the success of
the industry. We will have to admit that it is present in the factory
and in the selling mart, in the shows and on the road. A satisfied
customer, the best advertisement, finds expression in the loyal
recommendation an owner gives his own make of car; enthusiasm of maker,
of salesman, of owner—it runs along the line, and if advertising is the
gasoline which makes the car go, enthusiasm is the oil which keeps the
bearings of the industry lubricated.
The year 1898 saw the first real attempts of manufacturers in the
United States, either of gasoline, electric or steam cars, to make them
in any quantity.
The gasoline cars that were pioneers were the Duryea, the Ford and the
Haynes, but until 1898 these were distinctly still in the field of
experimentation. Ford personally built a car run by a gasoline motor of
the two-cylinder, four-cycle type of his own construction, and this car
ran 25 miles an hour. Ford was second only to Duryea who constructed
the first gasoline car built in the United States.
Duryea persisted in producing a buggy type of car, and failed to
get any sale for it. Ford and Haynes had no better luck in finding
purchasers for their cars.
Alexander Winton entered the field after Duryea, Ford and Haynes, and
in 1898 sold the first gasoline car that was bought for use in the
United States.
Ford built his first car in 1893. It was not a perfect car, but better
than any which had preceded it. He built his second car in 1895, with
a 4 × 4 two-cylinder, four-cycle motor. In this year he organized
the Detroit Automobile Company with a capital of $50,000. Ford owned
one-sixth interest, and drew $100 a month salary as chief engineer.
In the six years Ford remained with the Detroit Automobile Company it
put out only two or three cars. In 1901 Ford severed his connection
with the company, which shortly became the Cadillac Automobile Company,
and is now the Cadillac Motor Car Company. The Cadillac has had a
successful career, and is one of the cars of which a particularly large
number has been sold.
Leaving the Detroit Automobile Company, Ford started a machine shop
of his own, and in 1902 produced a car with a 90-inch wheel base, and
which is now regarded as standard gauge, using the two cylinders, 4 ×
4, and a double opposed engine.
After much difficulty he got money from half a dozen persons and
organized the Ford Motor Company with a capital of $100,000. At first
he owned only 25-1/2 per cent of the stock, but later he borrowed
$175,000 and bought 25-1/2 per cent more, and still later by paying 700
per cent of its face value, secured 7-1/2 per cent more, which makes
his holding in the company at this time 58-1/2 per cent of the stock.
The first Ford car to be a commercial success was put out in 1903, and
the record of production of Ford cars to date is as follows:
Year. No. Cars.
1904 1,708
1905 1,695
1906 1,599
1907 8,423
1908 6,398
1909 10,607
1910 18,664
1911 34,528
1912 78,440
1913 168,220
1914 248,307
1915 308,213
1916 533,921
In 1916 the Ford production was over one-sixth of the 3,000,000 cars in
use in the United States. In that year he produced nearly one-third of
all the passenger cars made in that year.
Ford’s car was a small, low priced car from the start. Haynes’ was a
larger and higher priced car. Winton’s was likewise a large and more
expensive car.
A RAIN OF AUTOMOBILE MAKERS.
The year of the Spanish-American war—1898—saw the beginning of a
veritable rain of automobile manufacturers in the United States. In
that year the Stanley, Stearns, Thomas, Matheson, Winton, and the
Waverley Company entered the field.
In 1899, there appeared the Locomobile Company, Olds, Baker-Electric
and Pierce-Racine (later absorbed by J. I. Case and now the Case car).
In 1900, Packard, Peerless, Glide, National Electric, Lambert, Elmore,
Babcock, Jackson, Knox and Lane were entrants in the lists.
In 1901, Acme, Gaeth, Pierce-Arrow, White, Royal Tourist,
Stevens-Duryea, Waltham-Orient, Pope-Toledo, Welch, Pullman and Rambler.
In 1902, Cadillac, Franklin, Pope, Studebaker, Sultan, Okey, Walter and
Schacht.
In 1903, Ford, Auburn, Overland, Moline, Premier, Corbin, Bergdall,
Holsman, Columbus and Chadwick.
In 1904, Buick, Cleveland, American Napier, Stoddard-Dayton, Marmon,
Mitchell, Jewel, McIntyre, Pittsburgh Electric, Ranch & Lang and
Simplex.
In 1905, Alco, American, Dorris, Johnson, Jonz, Kisselcar, Maxwell,
Monarch, Reo, Studebaker, Garford and American Mors.
In 1906, Anderson, A. B. C., Cartercar, Brunn, Thomas-Detroit, Kearns,
Sterling, Mora, Moon, Pennsylvania, Palmer & Singer and Staver.
In 1907, Albany, Atlas, Brush, Bertolet, Byrider, Carter, Chalmers,
Coppock, De Luxe, Oakland, Regal, Selden, Speedwell, Interstate, Lozier
and Great Western.
In 1908, Sharp-Arrow, Pittsburgh 6, Crown Midland, Rider-Lewis,
Paige-Detroit, Velie, Cole, E. M. F. and Hupmobile.
In 1909, Hudson, Advance, Cunningham, Coates-Goshen, Ohio and Abbott.
Since 1909 to date new cars put on the market include:
Stutz (1911), Chevrolet (1912), Grand, Chandler, Saxon and
Scripps-Booth (1913), Dodge and Dort (1914), Owen Magnetic (1915),
Drexel and Elgin (1916). Other automobiles in the field are the
Maibohm, Allen, Ben-Hur, Crow-Elkhart, Harroun, Lexington and Madison.
A table giving a complete list of automobiles is printed elsewhere in
this volume.
The earlier manufacturers of motor cars included many who had been
engaged in manufacturing bicycles, and following them was a group that
had successfully manufactured wagons and carriages. Still another set
of manufacturers were machinery men.
In the list of names of automobile companies which have been organized
during the period of the industry’s development, there are some which
have gone out of business, but not many.
The industry, generally speaking, has had comparatively few complete
failures. Mortality has been lower with it than with many other
business enterprises.
This is chiefly due to the intelligence which the manufacturers brought
to the business, plus the demand which sprang up for the automobile
as soon as the people, instructed with great and liberal space by the
press, realized it was the vehicle that could give what they wanted.
Never was the value of a concerted campaign of education better
demonstrated.
That unusually intelligent study of the subject of suiting the popular
desire was given by manufacturers is evidenced in many ways, but in
none that is so typical as was the standardization of motor cars.
At one stage of the industry its very life was threatened by a lack of
uniformity in the mechanical construction of the various types of the
automobile.
The big idea that has made Henry Ford’s millions was a combination
one. It was the building of a motor and car combined which could be
constructed at a cost that would command large quantity production.
This conception by Ford, alone, simple though it was, proclaims him the
genius he undoubtedly is.
The purchase of cars between 1898, when sales first began to be made,
and 1903, when Ford put out his car, was practically confined to
people of wealth and leisure. It required both to own and operate
an automobile. Men bought them at a cost of $3,000 to $12,000 each.
Purchasers were exhilarated by auto-intoxication—with little thought of
the practical uses the invention could be put to. Snobbishness, social
impression and display of superior wealth were back of many purchases.
But for the manufacturers’ quick recognition that the future of the
automobile did not rest with the rich, that to be a great money-making
industry, they must make automobiles for the mass and not for the
class, the business would probably today be no further advanced than it
was fifteen years ago. A parallel of what might have been may be found
in yachting or motor boating—two methods of deriving pleasure and speed
which are confined to the rich, largely because prohibitive in cost to
the mass.
Popularization of the automobile demanded standardization.
Automobilization of the nation would never be accomplished if the
hundreds of manufacturers that sprang up produced hundreds of
different cars with different sizes of parts, and different standards,
requiring owners of cars with which something had gone wrong, to wait
indefinitely for a particular device used by a certain company.
Early owners of cars learned by bitter experience what it meant to have
a screw loose or a tire put out of business in a town where the supply
stores did not sell that particular screw or that particular tire.
The spread of distance, annihilated by the auto, was threatened by
difficulties such as these.
High maintenance and repair costs ate up many an automobile buyer in
the early days of the craze. It wasn’t the original cost, although that
was high enough; it was the upkeep.
Men of real ability—competent business men and expert engineers—got
into the business, fortunately, largely for the rewards it promised,
and by standardization and systematization brought the cost production
down.
GETTING THE PRICE OF AUTOMOBILES DOWN.
The engineers banded together and studied standards of hard steel,
screw threads and wheel rims. The manufacturers, preserving open
minds, co-operated, and today automobiles are the most interchangeable
of all assembled mechanisms.
But for this the farmer, the moderate salaried city man, the mechanic
and the small tradesman would not today be consumers of motor cars.
But for this the average price for passenger cars, originally in 1900
around $3,000 and by 1911 reduced to $1,000, would never have been
gotten down in 1916 to $605.
The average price of all motor vehicles, combining pleasure cars and
trucks, was, in 1916, $636. The preponderance of passenger cars at the
lower prices brought the average down, since the average price of motor
trucks alone was about $1,800. For every motor truck sold, eighteen
passenger cars were disposed of in 1916.
With standardization and the consequent lowering of cost, the
automobile industry acquired a momentum that has carried production
forward on a constantly ascending scale, as witness these figures of
passenger cars alone:
Year No. of
cars made
1909 80,000
1910 185,000
1911 200,000
1912 250,000
1915 842,249
1916 1,617,708
The manufacture of motor trucks almost doubled in one year. The number
produced in 1915 was 50,366. In 1916 the number made was 92,130.
The above table, showing the rate of increase in passenger cars made in
seven years, makes it clear that the greatest growth in the passenger
car business has been since and including the year 1911.
That was the year in which the largest number of medium and low priced
standardized cars with refinement of detail and added equipments,
selling from $1,500 down to $500, was first put on the market. Ford
almost doubled his output in that year. The next years, 1912 and 1913,
also he more than doubled each year his output of the previous year.
And in 1916 he made nearly one-third of all the passenger cars produced
in the entire United States in that year.
Could anything demonstrate more conclusively than these facts, that
if you have an article within the price of the mass of the people, it
will sell, if the people want it? The one idea of Henry Ford—quantity
sales—saved to the United States the premiership in automobile making.
For other manufacturers adopted it, some radically, others in a
modified form. Its influence was unquestioned in putting the price of
motor cars at a figure at which a person happening to have less than
the income of a millionaire could afford to buy one, so that when every
one of the many values and benefits of the existence of the modern
automobile is scheduled, let us, in giving credit for them, place the
name of Ford at the head of the list.
When we have arrived at our destination, or have attained an object
much desired, our satisfaction is such that we are in a forgiving mind
and prone to forget the sacrifices we had to make, the difficulties we
had to overcome, the strenuous work we had to do. The end justified the
means, and we don’t think long about the hardships in the means.
Preëminence of the United States in the motor field has not been gained
without hardships, sacrifices and disappointments by those engaged in
it, nor was it reached by the immediate and uninterrupted success of
all companies organized to commercialize the invention.
While, as we have stated before, the number of final failures of
companies was small compared with those in some other avenues of
enterprise in the development stage, the number of individuals and
corporations in the automobile business that started on the wrong
road and found it impassable, was not small. But here again it was
fortunate for humanity, reckoning the automobile as one of the greatest
boons vouchsafed the human race, that the mechanical perfection of
the automobile was reached at a date coincident with more enlightened
thought, a liberalism of view and a clearer vision of the possibilities
of the future by our men of business.
For automobile enterprises that took the wrong road and got mired
in the mud of mechanical and management difficulties and financial
complications were, most of them, lifted out of the slough by men
who knew the right road and were better drivers. Had the automobile
developed mechanically to near-perfection a score of years before it
did, not only would the people as a mass not have been ready for it,
but it is doubtful if business at that period had developed to the
point of efficiency where it could recognize the possibilities latent
in the motor car as a money-making machine. Where money is, the best
brains go. Capital is timid. But brains and capital want only to be
shown.
Some of the most successful motor cars and motor car companies of today
were deeply mired in financial difficulties a decade ago, but were
pried and towed out and made great successes by new brains and new
capital administered by a new set of men.
Nor was the industry immune from the bane of all invention
industries—the patent right. The man who gave it the most trouble was
the man whose name is far up toward the head of the list of men who
were responsible for the inventive ideas involved in the motive feature
of the automobile—Selden.
He kept the industry in a ferment for ten years or more, whether
designedly or not, through his patent, the mere existence of which
tended toward restraining its development by discouraging inventive
expansion, and ceasing to exercise the depressing effects of a wet
blanket on automobile growth only when the influence of his patent was
neutralized by an adverse court decision.
The earlier commercialism of the automobile was characterized by many
extravagances in expansive plans, high financing and even recklessness,
not only on the part of manufacturers, but buyers of automobiles as
well.
In getting the price down to a figure which is not excessive,
the manufacturers removed the cause which militated most against
popularization of the invention and provided one of the reasons for
opposition to it by many people. To pay the prices which originally
prevailed, men mortgaged their homes and women sold their diamonds
and went bankrupt on the upkeep of the car. Manufacturers expanded
too lavishly, overcapitalized, and attempted great stockjobbing
consolidations, while incompetent officers were paid excessive
salaries, until conservative financiers entered a protest and the banks
called a halt.
The abuses which were co-existent with one of the eras of the
automobile’s development caused the industry to be regarded by a class
of the people as a luxurious outlaw and a menace to the well-being of
the country.
Vice-President Fairbanks raised his voice to protest against the new
manifestation of human nature’s appetite for joy and comfort.
James A. Patten declared a Kansas City bank held fifty-two mortgages
on as many automobiles, and that that sort of loaning was going to be
stopped.
Certain banks blocked, as far as possible, loans for purchases of
automobiles. A prominent banker as late as 1910 declared that the
initial cost of automobiles to American users, being $250,000,000
a year, with as much more for upkeep and incidental expense, was
equivalent in actual economic waste each year to twice the value of
property destroyed in the San Francisco earthquake.
A year after this statement was made, 1911, saw the dawn of the epoch
of low priced cars, and the low priced car has reversed the condition
from an economic waste, if such it was, to an economic gain, which it
undoubtedly is.
Through all the storms of protest and criticisms, manufacturers went
on their way, just as the automobile inventors had done under similar
circumstances when men laughed and scoffed at them and called them
crazy.
The depression of 1893 came too early to affect the automobile
industry, but that of 1907 hit it at the time when it was by no means
as strong as it was later; and yet, while in that year dozens of
companies were bankrupted, and in 1910, fifty-two went out of business,
it should be said that the great majority of them were not actually
starters in the race. They were entrants that never toed the scratch.
Their failure to make a start was due to lack of capital or inefficient
organizers. A very large proportion of automobile companies that
actually started in business have survived and are successful.
Names of automobile manufacturers who are prominent today were familiar
names in the earlier stages of the industry, and more of the original
automobile makers have survived than have fallen by the wayside.
REMOVING OBSTACLES TO AUTOMOBILE PRODUCTION.
One objection the old philosopher has to the automobile is an objection
that is strengthened by the fact that he does not own one. It is that
the automobile contributes toward making the age one in which a really
short time appears to be and is generally regarded as a long time. It
destroys proportions as it annihilates space.
Seventeen years is a shorter time in the view of the philosopher of
60, accustomed to reviewing events in his past life half a century
back, than it appears to a man of 34. It is just half the length of
this young man’s years. Time, as to duration, is thus comparative to
different views.
Seventeen years is not long for a commercial industry to take the place
which the automobile business now occupies in a country as great as
this. It is a short time in which to build up a business representing
the figures of two billion on the mark of the American dollar.
But this business, which has not been a business for even a score of
years, did not arrive at its present estate without vicissitudes, and
without strenuous work in removing obstacles in the way of its progress.
The seventeen years in which the industry made its record, saw the rise
and the fall of the steamer type of car, the wresting of an Old Man of
the Sea, in the form of a discouraging patent holder from the shoulders
of the manufacturers, the electric car largely depopularized and the
gasoline car established in wellnigh universal favor.
The procession of the more important earlier pioneers in the
commercialization of the automobile started with the Pope Manufacturing
Company at its head. In 1897 this company, which had successfully made
bicycles, manufactured electric cars at Hartford, but was unable to
find a market for them in the United States. An effort was made to get
the Newport set to take them up, but the wealthy owners of Newport
villas could not be induced to be even mildly interested.
So the Pope company decided to send them abroad, and shipped them on
the steamer La Bourgogne. But this ship sank at sea and the cars were
lost. The Pope company then made electric cabs, many of which appeared
on the streets of New York in 1898 and 1899, and finally sold its
electric vehicle business to the Columbia Automobile Company of New
Jersey.
This corporation was formed by a party of capitalists headed by
William C. Whitney of New York, and included P. A. B. Widener of
Philadelphia, A. F. Brady of Albany, and Thomas F. Ryan of New York.
All were interested and actively engaged in street electric traction
development in the East. Whitney, who was in public life as Secretary
of the Navy under Cleveland, was a man of far vision in industrial
possibilities, and recognized early in its development stage that
the automobile had a future. He was as quick to see, also, that the
gasoline motor drive was the coming means of propulsion, and he caused
the Columbia Automobile Company, whose name was changed to the Electric
Vehicle Company, to negotiate for and finally secure complete rights to
the Selden patents for gasoline motors.
Having a sweeping license agreement with Selden, the Electric Vehicle
Company undertook to enforce its rights, and one of the first concerns
sued for infringement was the Winton Company, whose gasoline car, sold
in 1898, was the first gasoline car disposed of by a manufacturer in
this country. The United States court upheld the patent, and nine
of the then leading automobile manufacturers, finding they must pay
royalties, formed an association under the title of the Association of
Licensed Automobile Manufacturers.
For thirteen years thereafter, until 1911, gasoline automobile
manufacture in the United States was under tribute to a royalty of
from four-fifths of one per cent to 1-1/4 per cent of the retail
price of all cars sold. The beneficiary of this license fee was the
Electric Vehicle Company, which “split” the fees with Selden, and the
Association of Licensed Automobile Manufacturers itself. The fees
amounted to very large sums, and the licensees wriggled and squirmed;
but the United States District Court having upheld the Selden patent,
there was no way out, unless a deliverer appeared.
And such a deliverer did appear.
It was none other than Henry Ford.
For a pacifist, Henry Ford is about the greatest fighter the American
industrial ranks have ever produced. His history has been a succession
of fights—fights to make a motor that would go inside a hat box, fights
to get anybody to believe in him and invest money with him, fights
to convince people that nearly everybody would buy an automobile if
the price was low enough, and finally the fiercest and most prolonged
fight of all—the fight to break the Selden patent monopoly and free the
industry from serfdom, give it free rein and relieve it of the incubus
of tribute.
Ford had refused to join the Association of Licensed Automobile
Manufacturers and had gone on making his engine and adapting it to a
car which he put out, as has before been said, in 1903. The Electric
Vehicle Company, which held the reins and was driving all the gasoline
car makers except Ford, cracked its whip in Henry’s direction and
brought him up standing, and bristling as well.
In the suit for infringement against Ford the Electric Vehicle Company
won in the lower United States court, but it reckoned without its
Ford. That product of a strain of Irish-English fighting blood didn’t
consider he was whipped because one court decided against him, as all
the other manufacturers, who submitted their necks meekly to the Selden
patent yoke, had done.
He promptly appealed and fought the case like a wildcat up to the
United States Circuit Court of Appeals, and through that tribunal, and
with such success that, in 1911 this court reversed the finding of the
lower court and gave the decision to Henry Ford.
The original suit in the lower court was begun against Ford in 1903,
so that his fight against the first and only automobile “trust” was an
eight year war.
But during it all, he never faltered in his activities in perfecting
his car and making his elaborate preparations to build and market it.
His confidence in his final victory was not affected in the slightest
degree. He went on, pursuing his object with unruffled mien.
It must have been a trying brand of chagrin that the gasoline car
manufacturers, who had tamely submitted to their first setback in
the effort to slip the fetters of patent rights, had to wear around
with them. They had looked askance at Ford. They feared he was likely
to kill the automobile “game” by putting out a car that would make
automobiling common, and put a damper on the purchase of the cars
they made, by people who could afford to buy them. At best, he was
calculated to be a disturbing element in the business—probably driving
down prices to a point where there would be no profit in them.
And here he had been the savior of the automobile business.
Many men have written letters that have been their undoing. Selden had
made an entry in a personal notebook or diary that brought about his
downfall and the loosening of his grip on automobile manufacturing.
The ground on which the United States Circuit Court of Appeals decided
for Ford and against the Selden patent was that the intent of the
inventor had been to patent a motor designed after the type of a motor
invented by Brayton of which the Ford motor was not an infringement,
and not after the type of the gas engine of Otto the German, of which
the Ford motor would have been an infringement, and that Selden had
clearly disclosed this intent, as evidenced by a slurring entry in
his diary regarding the four-cycle Otto engine, characterizing it as
“another of those d—d Dutch engines.”
The Otto engine for stationary purposes was in use before Selden filed
his application for the patent, and if he did not intend the patent to
cover an engine of that type he had no hold on the manufacturers who,
with scarcely a single exception, were making automobiles, with motors
patterned after the Otto type. These manufacturers could have done what
Ford did—taken the case up and got the same decision, but they didn’t
do it, thereby making Henry Ford the emancipator of the automobile
industry.
This delivery by Ford of automobile manufacturing from patent restraint
and his quantity production idea, without any other of the many things
he has done, would have made Henry Ford what he is—the most commanding
figure in the automobile industry today.
There can be no doubt that the very existence of the Selden patent with
the rights it conferred to tax every single automobile, was a deterrent
to the growth of the business, because with the wiping out, through
Ford’s court victory, of the right of William C. Whitney’s Electric
Vehicle Company to take toll of all gasoline autocars produced,
encouragement was given to capital to invest more largely in the
business.
If, in the springtime, the season when the grass begins to sprout, you
remove an old door that has lain flat on the grass all winter, the
grass in the space covered by that door will literally spring up.
So when the lid—the Selden patent—was lifted from the automobile
industry, it sprang to the front. The year 1911 was the epochal year
in volume of production in the business. From that year dates the
present era of automobile high production. It wasn’t that many new
companies entered the field. It was that those already in it expanded
and increased their output. There was no longer an Old Man of the
Sea, in the form of a tax on production, clinging to their necks and
shoulders. The age of standardization had come, and the soundness of
Ford’s quantity production idea had been demonstrated. Thence on,
the automobile industry had a clear course, if not in all cases easy
sailing, and it has traversed it on a straight line, with a current of
popular demand running strong in the direction it has been headed.
GASOLINE CAR IN POPULAR DEMAND.
Pioneers in manufacturing gasoline cars during the period beginning
at the time—1898—when the first gasoline car, a Winton, was sold,
were Clarke Bros., makers of the Auto-car, E. R. Thomas whose name
the Thomas Flier took, Stearns, Chalmers, Jeffery, Wilkinson, who
designed the Franklin car, Olds who changed from steam to gasoline,
Brush, Ford, Leland who produced the Cadillac, Haynes and Apperson.
Many familiar cars came into the field later, or were developed and
advertised by men who became identified with them at a later date.
Although its manufacture was started in 1903, the Overland car, which
ranks second to Ford in quantity production, did not become the factor
in the industry it is today until John North Willys, a salesman,
became identified with it and gave it its remarkable vogue through his
personality and spectacular salesmanship.
The gasoline car was struggling to perfection when the electric and
steam types of cars were reasonably well established on the market.
In 1896, New England saw its first motor race of electric cars. The
names of make or makers of electric cars familiar from that date
on include those of Riker, Pope, Waverley, Baker, Woods, Barrows,
Studebaker, whose first cars were electric, Columbus Buggy, Rauch &
Lang, Detroit, Ohio and Anderson.
But the electric car industry never has reached the proportions of the
gasoline car industry. It has never advertised in the lavish manner
adopted by gasoline car makers. It has not entered races to the extent
its gasoline competitors have. It adopted conservative methods which
have given it a slow growth. It is only within the last five years that
shaft drives have been perfected in electric car construction, while
producing controllers that would not arc, whatever the provocation,
have been matters of slow evolution.
But that the electric car is a perfectly balanced piece of mechanism
and the one type of the automobile with the least fits and starts, is
conceded, and this superiority will doubtless enable the electric type
to make up in the future in the motor truck field what it has lost to
the gasoline type in the passenger field.
If the passenger automobile has not reached the length of its use and
consumption, and it unquestionably has not, what shall be said of the
freight automobile, the industry in which is yet in embryo?
The greatest future field for the automobile is without doubt in this
direction, as is evidenced by numberless indications.
The increase in motor trucks made in 1916 over 1915 was within less
than 8,000 of being double the number of the previous year. The number
produced in 1916 was 92,130, against 50,369 in 1915, with an increase
in retail value of $40,000,000. A business that nearly doubles in
product while showing an increase in total sales of only 33-1/3 per
cent, as the automobile truck business does, is seen by analysis to be
getting the price of its units down, and that is the surest means in
commercial production to insure increased consumption.
Perfected devices are operating in the motor truck field as they did in
the passenger car field to lower cost, and the lower the cost of motor
trucks is gotten down, the more people will buy them.
The field of the motor truck’s usefulness is ever widening. The
European war has demonstrated many directions in which it can be
utilized, while its adaptation to the country is as feasible and
economical as its adoption by the city. Its use by national, state and
city governmental departments is growing rapidly, and the best evidence
exists of its superior economy to the horse for many purposes. And when
the high wave of motor truck use rolls in, the electric type will be
found riding on its crest. Already there are upwards of 50,000 electric
trucks alone in use.
The electric passenger car, while far behind the gasoline car in the
race of automobiles, is distinctly in the lead of the steam type.
Never was the biblical saying, “and the first shall be last,” truer
than of the steam automobile. First to arrive at the starting line,
it was distanced early in the quarter stretch. The first steam car in
the United States was sold in 1889, the first electric in 1892 and the
first gasoline in 1898. And though it had a start over the gasoline car
of nine years, it was never able seriously to compete with it, and 1905
saw only one large manufacturer left in the steam car industry.
At one time, about 1900, it looked as though steam and gasoline cars
were running neck and neck in popular favor, and the names of Riker,
White, C. E. Whitney and Stanley were as well known almost as those of
Ford, Chalmers and a score of gasoline car makers are known today, but
the contest was a short one.
The gasoline car forged ahead. Its success discouraged the steam
car makers, most of whom changed from steam car to gasoline car
manufacturing, and the business of steam car making narrowed down to
two manufacturers—Stanley and White. Finally, in 1911, White gave up
making steam cars and devoted his facilities to gasoline cars only,
leaving Stanley to share only with Doble in the steam field.
The reason why the car buying public gave enthusiastic patronage to
gasoline cars and scant encouragement to steam cars was that the use
of the steam car requires more mechanical knowledge than does that of
the gasoline car, and the work of making repairs is more complicated.
The man of today wants to do a thing in the easiest way. His education,
through the conveniences supplied in modern life, is all along the line
of short cuts to anywhere and anything. “Why work when you don’t have
to,” is his motto, and he has never been able to see why he should take
the time to become a proficient mechanic to give himself pleasure, when
he can buy a gasoline car and escape doing so—and much work in running
his car and repairing it, as well.
The steam automobile reached the zenith of its vogue prior to 1905.
Beginning with that year, its use declined and that of gasoline cars
increased. The gasoline type is now almost universal in passenger
automobiles, and the fact that the power units in the operation of the
gasoline motor are more economical than either electricity or steam,
has its bearing on their general popularity.
AUTOMOBILE DEMAND MADE ACCESSORIES NECESSARY.
A history of the commercializing of the automobile which does not make
mention of the manner in which the development of the industry called
into being an almost endless list of incidental and accessory products,
is not complete.
The production of the finished automobile involves a multiplicity
of units, and as no automobile manufacturer makes all of these, but
depends on independent factories for certain of them, there has been
a multiplication of enterprises supplying products entering in the
construction of automobiles, whose development and financial success
have kept pace with those of the automobile itself.
Foremost in the list of accessories for the automobile are tires, and
the industry in this product is of vast proportions. The production of
automobiles—passenger and freight—having been 1,617,708 in 1916, and
the manufacturers having delivered each of these vehicles complete with
a set of four tires, the number of tires required for 1916 sales of
automobiles alone was 6,470,832.
But the tires put out with new automobiles form only a slight
proportion of the total tires sold by tire companies. It is stated
that each of the over three million cars in use in the United States
consumes an average of eight tires a year, so that automobile buyers
are purchasers of probably 20,000,000 tires a year.
The pneumatic tire was one of the greatest factors in giving the
automobile business its impetus. Charles Goodyear, in a broad sense,
laid the foundation for popularizing the automobile, when, by
accidentally dropping rubber on a stove, he discovered the principle of
vulcanization.
The development of the automobile was retarded for years, because,
while iron shod horses, it would not successfully shoe automobile
wheels. The greatest obstacle to the mechanical perfection, as well as
to the development of the automobile by general adoption, were road
shock to the automobile and mutilation by the automobile of the roads.
The pneumatic tire removed both obstacles simultaneously.
The pneumatic tire was invented by an Englishman named Thompson, who
patented it in 1845. Dunlop, an Irishman, was the pioneer manufacturer
in 1888, and Michelin of France first applied it to the automobile.
The manufacture of body parts is obviously a tremendous industry, and
while the body is a prime essential to the automobile, it was a part
that existed in horse drawn vehicles, and, therefore, did not play the
part that the pneumatic tire did in accelerating auto development.
Comparable in importance to the tire was the nonskid chain, the
invention of Parsons, an English engineer, who patented it in 1903. As
the pneumatic tire enabled the automobile to be used more successfully
and in larger numbers in good weather, so the nonskid chain enabled
it to be used in bad weather. Prior to its adoption automobiles were
used to only a limited extent in wet or slippery weather. Its adoption
is credited with having added one month a year to the possible use of
every automobile, a result which would naturally increase the number of
automobiles used, through making them more efficient, and by decreasing
the life of a car through added use.
Next in importance in extending the field of purchasers of automobiles
was the self-starter, the invention of Coleman, who, though little
known to the public, is the inventor of so many things in electrical
use as to be comparable to Edison.
The electric self-starter is credited with creating a million
automobile buyers, a large proportion of whom are women, and with
having added nearly 15 per cent to the service of the motor car.
Other aids to the successful commercialization of the automobile are
solid tires, invented by Grant in 1896; the demountable rim, invented
by Perlman in 1906; sliding transmission, the invention of Dyer; the
nonskid tread, and chambered spark plugs, the latter invented by
Canfield in 1898. Of minor improvements, of which there have been
scores, the most notable were those of side doors, introduced by Marmon
in 1902; tops to bodies, introduced in 1903; speedometer, gasoline
pressure system, carburetor, shock absorber, electric lighting and oil
gauge.
The evolution of the automobile has been facilitated by every
improvement which makes it easier of operation, and the sale of motor
cars has been increased by them.
The more one reviews the advance made by the automobile during the
seventeen years of its commercialization, the more one can appreciate
the feverishness characterizing its production, which can be seen and
felt by anyone who visits the automobile manufacturing sections of
Detroit, Cleveland, Indianapolis or Toledo. The demand is so great
for automobiles, and they are being bought in such numbers, that the
factories producing them work at a speed and under a pressure such as
are paralleled in our industrialism only in munitions of war plants.
Busy are the cities where automobile manufacturing forms an important
industry, and busy they are likely to continue for years to come, for
as a commercial industry the business of making and selling automobiles
has not yet even approached high water mark, in the opinion of those
best qualified to judge.
The country districts have yet to be heard from in louder tones. The
possibilities of the automobile in the country, from a commercial
standpoint, constitute a fascinating subject for speculation. Although
there are over 6,000,000 farm families, only 300,000 automobiles were
bought by them in 1916, indicating that the rural element so far has
not really begun to take hold of the automobile, because the normal
yearly sales of horse drawn vehicles, most of which were sold in the
country, prior to the automobile’s adoption, were over 1,000,000.
By far the greatest proportion of motor driven vehicles bought in the
country are now passenger vehicles. When the farmer wakes up to the
economic superiority of the motor truck and motor tractor over the
horse, the sales of other forms than passenger cars in the country will
scarcely have any bounds. The best grounds for this belief lie in the
fact that at present there are 5,000,000 horse drawn vehicles in use,
against less than 300,000 motor trucks.
In this development of the motor freight vehicle in the rural
districts, the matter of education will play its part, as it does in
all evolution, but slowly, as it always does.
Just as the creation of farm products as a whole is being increased by
educational means, so will the use of the motor wagon in place of the
horse be increased by the farmers’ information and knowledge of its
advantages and saving.
When the farmers all learn and realize the full extent to which
the use of the work automobile pays dividends on their labor, the
commercializing of this vehicle will be in quantities probably
exceeding those of the passenger car.
CO-OPERATION’S PART IN THE AUTOMOBILE’S COMMERCIALIZATION.
If there is any one idea more than another that is productive of
results in development of large proportions, it would seem to be that
represented by co-operation.
Individuals may make successes, but they are successes that are limited
in their proportions.
The era of greatest material development in this country has been that
in the period represented by the last quarter century. This is shown in
the fact that our national wealth during that period has increased in a
ratio unparalleled in any previous period of time.
Only a little reflection will show that same period to be that period
in which the value and benefits of co-operation in business as a whole
were realized and taken advantage of.
The principle of co-operation has been known since man learned to
reason. It was applied in the building of the tower of Babel and
of the Pyramids. The foundation of it was a fact that man early in
his evolution from the cave stage discovered—a simple fact plainly
demonstrated, when primitive human beings found that one man could
not lift a battering-ram, but that twenty men could make of it an
instrument with terrifying powers of destruction.
An aspect of co-operation that was slow in imposing itself on the
understanding of the business world was that if a man conceived a
new idea, and he concealed it from others, he was not only depriving
others of its benefits, but himself as well. In locking the door on his
idea, he locked himself in. He did not reflect that the world rests
on a foundation of co-operation; that nature is co-operative; that
without co-ordination between the planets in space, the cosmic void
would not continue to be occupied; that co-operation is the invisible
chain linking together the world, sun, moon and stars, and without the
binding twine of co-operation they would fall apart like the stalks
from the sheaf when unbound.
Almost every valuable lesson might be learned from nature if we knew
and fully understood her laws, and co-operation is one of the most
potent of these laws. But it took man a long time to learn even the
rudiments of this law of co-operation—that it supplied a force of a
hundred horsepower where one horsepower was used before; that its moral
influence was tremendous, and that it was to business what the steam
radiator, internal combustion, or the electric storage battery was
to the horseless carriage—a means of propulsion, a driving force, an
agency of high power to produce progression.
There can be no question that the automobile industry had, in the era
in which fate decreed it should make its debut, favorable conditions.
Not only did this era happen to be the era of a better understanding
of the science and value of advertising, but also the era in which a
better understanding has been gained of the principle and value of
co-operation.
Standardization in the automobile industry, as has been said herein,
was an important factor in popularizing the motor car. But how could
standardization have been brought about without co-operation?
Producers of automobiles, even, did not immediately adopt the real
spirit and practice the true principle of co-operation. They formed
an association with that purpose, but in the first meetings they
approached the matter of genuine co-operation like a man walking in his
bare feet on ground strewn with broken glass.
They kept up the practice of secretiveness; each man was afraid to “put
the other man wise,” still clinging to the ancient practice of hiding
his light under a bushel—an impulse founded on that same semi-savage
selfishness of primitive man which impelled him to hug to his hairy
breast the shin bone of his “kill,” while eyeing his fellow man with
fear, hatred and distrust.
Gradually, through the influence of minds more original, independent
and far seeing, the glacial reserve was thawed out, and automobile
producers began practicing co-operation in its unrestricted,
untrammelled form.
With the genial, warming rays of co-operation turned on the industry,
problems of vast quantity production at remarkably low cost, easy and
rapid assembling, inexpensive maintenance, and the vexatious problems
of freight movements to bring in raw material and take out the finished
product for distribution, became no longer work, but fascinating
play. Thus does co-operation make an elysium of the workshop, turn
the darkness of gloom into the light of day, and give grounds for the
belief that if the millennium ever comes, co-operation will be the
vehicle it will be transported in.
At one stage of the American automobile industry, the European cars
displayed a strength and sturdiness so superior to ours that our
manufacturers nearly despaired. This was another crisis of many in
the industry. But co-operation enabled the cause to be found and the
crisis to be met. The European manufacturers knew why their cars stood
up better than ours, but they wouldn’t tell. This was the same old
dog-in-the-manger that has helped to make the world’s progress slow.
So our manufacturers, co-operating, went to work and found out for
themselves. Tungsten, vanadium and chromium spelled the reason. The
Europeans had been using these and other alloys, and with scientific
heat treatment had been producing a special steel, and keeping it
strictly to themselves.
Trust the peeking, inquisitorial, persistent “Yankee” to find out when
he once gets well started on the scent. And when there are a lot of
them, all peering and peeking about, what chance has the poor European?
But it is to be doubted if one “Yankee” could have “tumbled” to chrome
steel. It took a combination of them to do it. They didn’t discover the
secret until they were banded together by co-operation.
Co-operation contributed to the general adoption by the motor industry
of the automatic machining of parts. What that meant in economic
production was the saving of millions in cost of construction, which in
turn got the automobile down to the level of the common people’s price.
In the adoption of the system which substituted the “machining” of
automobile parts for hand production, the industry instituted savings
of time and labor and therefore cost, one instance of which illustrates
the almost incredible potentialities in scientific economy.
A block of cylinders, which takes eleven hours to bore by hand, is
bored in two hours by automatic machinery.
WORLD YET TO LEARN THE LESSON OF ECONOMY.
Will the world as a whole ever learn thoroughly the lesson of what the
saving of time means in its equivalent of money? Full realization
of this is practically confined in this day and generation to some
manufacturers, and to most efficiency experts. But the great mass does
not acutely see it.
The farmer knows that if he takes four hours to go to town when it is
not necessary, he has lost the money represented by four hours’ work.
That is plain to him, but it does not strike him that taking four hours
to haul a load of grain to town by horses when it would take only one
hour to do it by motor truck is throwing money away, and is an economic
waste only in another form. Nor does he quickly see that a motor truck
will perform service more economically than the horse, including
cheaper cost of maintenance.
He also appears unable to get the same viewpoint on the economic loss
by bad roads, that he does of wasting four hours to go needlessly to
town.
The farmer has long had demonstration of the economic superiority of
the mechanical reaper over the hand cradle, that of the mechanical
thresher over the flail, and that of the drill over sowing by hand. But
he is slow to see that the motor truck is superior to the horse and a
factor in greater economy as the reaper, the thresher and the drill
were superior to man, while at the same time his liberator from the
hardest types of labor, and an economic saving to boot.
When all farmers learn the full facts of the superiority of motor
mechanism over horses, only one instance of which is that their cost
per mile haulage is 16-2/3 cents, against 30-7/10 cents for the horse,
a wider use will result. It is only the highly developed efficiency
expert who yet can count a minute of time in its equivalent of cents,
and an hour in its equivalent of dollars. The automobile industry has
had the benefit of the highest quality of efficiency generalship.
Chalmers was making $70,000 a year with the National Cash Register
Company when an automobile company secured him by promising more.
Flanders was offered by Ford, in addition to his salary, a bonus of
$20,000 if, in the first year of his administration, he would turn out
10,000 cars. By installing the first automatic machine tool system,
which itself was mechanical co-operation, Flanders collected the bonus.
No industry, except perhaps oil or steel, has paid men such salaries,
bonuses and commissions as has that of the automobile.
Co-operation by the automobile industry has been pursued in its public
shows for seventeen years—the period of the industry’s greatest
strides—beginning with the first one in 1900 in Madison Square Garden,
New York. The Seventeenth annual auto show was that in New York and
Chicago in January, 1917.
There are many lines of industrial production in which to this day the
factors have not gotten together in co-operation, lines in which each
producer is working alone, and it is noticeable in many of them that
development is slow and advancement tardy.
The automobile makers early applied the principle of co-operation
by formal association. They organized the National Association of
Automobile Manufacturers to advertise automobiles at the first auto
show in New York, and to “encourage general practices of mutual
benefit,” a statement of principles that is brief but sweeping.
Stimulating influences in the formation of this, one of the earliest,
and one of the most comprehensive and sincere co-operative industrial
associations, were the necessity for presenting a united front, which
legislation adverse to the automobile created, and of popularizing and
inspiring confidence in an innovation. Co-operation was further made
imperative by the necessity for better roads. Had the roads of the
United States been better than they were when the automobile first
came into being, the industry might by now be able to write its annual
production in larger figures than 1,600,000 cars made in 1916.
That the automobile associations have the true principle of
co-operation and not the semi-true or false variety, is evidenced by
the fact that their co-operative efforts have been from the start for
the benefit of the industry as a whole and not for the benefit of
members of the associations alone. They have always admitted to their
councils all manufacturers, whether association members or not, and
co-operated on a free and full basis.
Broad liberalism has been practiced. The many young men engaged in the
industry have been credited with this. Coming into the business arena
at a late date, they were not handicapped by prejudices and hardening
of the arteries of open-minded thought. They believed in the principle
of “one for all, and all for one,” which is the keynote of co-operation.
As the world has these men to thank for the constantly enlarging
pleasures and comforts of the automobile, so it has them to thank for
such good roads as there are, for it is as certain that automobiles
have improved roads as it is that automobiles exist.
The organization of the National Association of Automobile
Manufacturers was followed by that of the co-operative Association of
Licensed Automobile Owners, organized to resist the tightening of the
clasp of the licensor of the Selden patent rights, and by the Society
of Automobile Engineers, and still later by the American Motor Car
Manufacturers Association. The Automobile Board of Trade followed,
and today the trade association is the National Automobile Chamber of
Commerce. Fostering trade, reforming abuses and promoting harmony, were
steadily the aims of all the organizations, and how well they have done
it is attested by the fact that no association of producers has better
demonstrated and more completely justified the valuable principle of
true co-operation.
Standardization in the automobile business has never discouraged
individuality of the manufacturers in the essentials of form or speed.
It was confined to those directions where appearance was not important.
It never extended to bodies, stream lines or designs that would deprive
a manufacturer of distinctions and selling points.
It is standardization of detail—uniformity of screws, locks, washers,
spring and bearing parts, water connections, etc. Co-operation
has been practiced intelligently, and the result has been that
standardization favored economical manufacturing by creating a large
demand, calling for quantities that fostered specialization in parts by
manufacturers, with resulting low cost to the automobile maker. It also
left him free to center his efforts, energy and capital on production
in quantity, and himself get down the price of the finished automobile.
To the thinker, one of the most interesting features of the automobile
industry is this example it has given to the world of efficiency and
co-operation. We are not surprised at efficiency in the steel business
or the oil business, because they are industries conducted practically
by one man power; and if autocratic rule is not efficient, its last
excuse for being might appear to have ceased to exist; but to find
several hundred different manufacturers with divergent ambitions,
ideals and interests benevolently engaged in co-operative competition,
justifies, it would seem, that optimism which sees the world as growing
better.
Certainly if “by their works ye shall know them,” the progress made
by the automobile industry in the short space of time it has played
the star part on the industrial stage, has been the most splendid
demonstration of the value in commercial industrialism of the
tolerant, broad minded type of co-operation, coupled with efficiency.
It is an example of the value of harmonious co-ordination of the
differing efforts of man in advancing the material progress of the
world, and in the case of the automobile industry, the best assurance
of its continued advance as the moving force in the production of one
of the greatest and most beneficial forms, not alone of transportation,
but of mind culture, of healthful relaxation and of sane recreation.