HISTORY: FOUR MAJOR AUTO INDUSTRY EVENTS
by Bob Hagin
August 30, 1996
By the time I became a dedicated "car guy" just after World War II, the automobile industry had been in place and operating for half a century. The year was 1946 and cars and trucks were commonplace. Almost every family either had one or aspired to ownership and returned GI's made auto ownership a top priority.
But just 50 years before, autos were so rare that they were often included in circus parades. They were few and far between and most of the population looked on them as the products of backyard inventors and bought by the affluent as toys.
The business side of auto making was destined to develop once the dreamers and inventors had made the car a viable, working devise. The auto industry celebrates its 100th birthday this year and these are the high-points that made it possible for it to develop into what it is today:
SERIES OF IDENTICAL CARS BUILT - Although several self-propelled vehicles had been made and were operating in the US by 1895, they were pretty much "one-off" and none of them were alike. That changed in 1896 when the Duryea brothers, Frank and Charles, formed a company to build horseback carriages using mostly outside venture capital. After winning some early-day races, their company, the Duryea Motor Wagon Company produced 13 look-alike (albeit poor quality) autos and offered them for sale. This started the auto industry in America as we know it today.
AUTO DEALERSHIP SYSTEM ESTABLISHED - From the first, auto makers realized that selling their products to private parties directly from the factory was too slow and might require a buyer to travel across the country. Dealerships for bicycles, farm machinery and household items had been in operation for decades so it was natural that car makers approached these businesses to take on their "horseless carriages." Selling autos was a sideline to those early agents and in most cases, they would only order a vehicle from the factory when the buyer paid for the car. William Metzger is universally credited with being the first true auto dealer that carried a stock of merchandise and sold Waverlys and Wintons from his Detroit showroom in 1898.
AUTO PARTS STANDARDIZED - When we buy new parts for our autos, we expect them to fit and built to a "standard." In the early days, this wasn't how things worked. Each part would be hand-fitted to a particular car and not necessarily be exactly like the same parts fitted to another vehicle of the same make and model. Henry Leland changed that and produced early Cadillacs with absolutely identical parts. In 1908, he submitted three randomly chosen Cadillacs to the Royal Automobile Club (RAC) of England for a test. The three cars - chosen from a pool of eight - were dismantled down to the last nut, bolt, bearing and cotter pin and all the parts from the three were mixed together. Under close observation by RAC engineers, Cadillac mechanics reassembled the cars from the pile of 2163 parts and drove them away. While it doesn't sound like much today, it was the first time auto parts were built precisely enough to facilitate true mass production by non-technical labor. This allowed the car to become a practical means of transportation rather than a rich man's plaything or a blacksmith's hobby.
FIRST SUCCESSFUL AUTO ASSEMBLY LINE - One day in 1913, 29 magneto assemblers at the Ford plant in Detroit made American automotive history. The previous working day, each assembler had taken about 20 minutes to produce one magneto by himself but on April 1, the men were positioned side by side at a long table. The first worker began by putting two parts together and when he came to predetermined point, he passed the unit on to the second man, who installed a third part. This continued on until the 29th man installed the 29th part and the magneto was complete. Magneto assembly time dropped to just five minutes in a very short time. Although similar systems had been used in making sewing machines and in food processing plants, it was the first time that the assembly line technique had been applied to something as complex as an automobile. Ford applied the system to the rest of his plant and chassis frames placed at the starting point of a conveyer belt rolled off the other end as complete, running cars. The auto assembly line was born.
AUTO TIME PAYMENTS AVAILABLE - At the turn of the century, thrift was preached by bankers rather than the borrowing of money for luxuries. They would lend capital for business ventures, farms and real estate but the middle class was encouraged to save its money (in the bank, of course) and pay cash what it wanted. Even then autos were big-ticket items and the average family would have to save for years to buy a car. But the demand for autos was great and the attitude of those banks quickly changed. By 1913 a new car could be driven home by the buyer for a 25 percent down payment and by 1924, installment purchases of cars in this country was $2.2 billion. In 1919, General Motors was the first auto maker to form its own credit organization and made it possible for GM dealers to not only sell the product but to arrange its financing on the showroom floor.
There are lots of milestones in the development of the automobile. The pneumatic tire, the self-starter, the transmission and many more made the actual operation of the machine possible by average people. But these are tangible items that became integral parts of the car.
But without the "business" side of the business, we might all be traveling by trains, street cars or horse and buggy rigs.