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A Brief History of The First 100 Years of the Automobile Industry in the United States

Chapter 1 - A century whittles auto makers to 3

by Richard A. Wright

Of the thousands of auto companies that have produced cars in the United States in the hundred years of the auto industry in this country, only three survive. These three are the products of a weeding out process of intense rivalry. Despite this rivalry -- or in fact because of it -- Ford Motor Co., General Motors and Chrysler Corp. are closely related, by mergers, by intermarrying with top executives of rival firms and through other business relationships.

Chrysler Corp. is now headed by Robert Eaton, a former top General Motors executive. The No. 2 man at Chrysler is Robert Lutz, who came to Chrysler from Ford Motor Co. after Lee Iacocca took over Chrysler after being fired as president of Ford Motor Co. Top-level personnel changes have been going on since the very beginnings of the industry.

In the family trees of the three companies are numerous firms that have been absorbed, merged and discarded. General Motors was built on Buick, Oldsmobile, Oakland and Cadillac. Ford Motor Co. absorbed Henry Leland's Lincoln Motor Car Co. (Leland also founded Cadillac). Chrysler Corp. was built on the remnants of the Maxwell and Chalmers car companies and absorbed the Dodge Brothers venture after their deaths.

Chrysler Corp. acquired American Motors a few years ago. AMC was formed by the merger of Hudson and Nash and the product Chrysler was most interested in was Jeep, which carried American Bantam, Willys-Overland, Ford Motor Co. and Kaiser-Frazer in its ancestry.

Top executives of the three auto companies have moved easily from one to another - William Knudsen from Ford to GM and his son Semon Knudsen from GM to Ford; Walter Chrysler from GM to his own Chrysler Corp. and later Lee Iacocca from Ford to Chrysler, then Robert Eaton from GM to Chrysler; Earnest Breech from GM to Ford. These intercorporate switches were possible because, although each auto maker has its own culture, Detroit's auto industry is a family affair.

It could be argued that since the development of agriculture about 12,000 years ago, the two inventions which have had the most profound effect on the way we live have been the electric light and the automobile. The electric light made it possible to erase the boundary between day and night. The automobile expanded our geographic boundaries and allowed us to go where we want and live where we want.

We reserve for the car an emotional relationship we do not have with other machines, not with refrigerators, or airplanes or even the curiously human computer. The car has been venerated as an object of affection, excitement, even love. And when it fails us, we heap upon it the bitterness and intense anger we generally reserve for our loved ones.

Think for a moment about the world of 100 years ago. Travel was slow and difficult. A trip to anywhere was a major undertaking. Dearborn was a day's journey from Detroit on the road to Chicago. Most roads were just gravel or dirt. Cities, usually built on streams or lakes or rail lines were compact and congested. They were quickly transformed by the car into sprawling urban complexes, held together -- and in some ways split apart -- by the freeways and interstates that in fact bind them.

Buildings have been razed and farmland paved over to provide parking for the almost 300 million vehicles we own in the United States alone.

And along those roads are motels (motor hotels), fast-food restaurants, shopping malls, drive-in movies, drive-in banks, drive-in florists, even drive-in funeral homes. In this century, the auto has spawned whole industries where none were before. Depending on whose figures you accept, one in six or one in seven working Americans is engaged in the building, selling or maintenance of motor vehicles. The Census Bureau says auto dealerships account for 28.5 percent of all the retail business in the United States.

Auto makers are the biggest or among the biggest consumers of steel, aluminum, copper, glass, zinc, leather, plastic and platinum and they use most of the lead and rubber consumed in the United States. The automobile is not cheap. In addition to its voracious consumption of resources at the societal level and our income at the personal level, its toll of death and injury surpasses war many times over. Auto accidents are the leading cause of death of Americans from age 5 to 45. But there is no talk of banning the auto or even seriously restricting it. Most of us consider a driver's license a right, not a license. Controversy rages over such "invasions" of our rights as laws requiring use of safety belts and 55-mph speed limits. In Germany, in fact, a bitter battle has been raging for some time over the imposition of any speed limit on the autobahns.

The automobile is, like no other machine, part of us.

The automobile's time had come to America 100 years ago. Here and there around the world, men were at work on motorized vehicles, unknown to each other, separated in time and space. Karl Benz and Gottlieb Daimler in Germany; Louis Renault, Rene Panhard, Emile Lavassor and the Peugeot brothers in France, and in the United States, Frank and Charles Duryea, Ransom E. Olds, Charles King, Elwood Haynes, David Buick and Henry Ford -- all were working on vehicles they called by various names. For the most part, they worked in ignorance of each other.

Benz in Germany was the first to put an automobile into production, a three-wheeler he built in 1885. Just when his first delivery took place is not clear. It seems likely that it took place in spring of 1886. In the United States there were tinkerers, but no industry until 1896.

In fact, when Benz first got his three-wheeler chugging into movement in Mannheim, it was not the first time a vehicle had propelled itself. What was new was that Benz perfected his machine, put it into production and people bought it.

Isolated instances of automotive promise had come and gone. As early as 1769, Nicolas Cugnot fitted a wagon with a steam engine, fired it up and ran it across a field in France, thereby becoming, as far as we know, the first person to make and operate a powered vehicle. Incidentally, Cugnot's machine did not handle well and he ran it into a wall, the world's first auto accident. Legend has it he was arrested for his trouble and so might also be credited with the world's first moving violation.

The first internal combustion engine was built in 1860 by Ettienne Lenoir in France, but it ran on illuminating gas and was quite different from the modern engine. But in 1876 in Germany, Nikolous Otto patented the four-stroke gasoline engine -- the type used today.

So the automobile was born in Europe. But it quickly took on an American character after the United States industry began in 1896. And not just an American character, a midwestern rural American character. The men building the first cars in America were for the most part from rural backgrounds in the Great Lakes area - Henry Ford, Ransom Olds, Charles B. King and David Dunbar Buick, of Michigan, and Alexander Winton and James W. Packard, of Ohio, Elwood Haynes and Edgar Apperson, of Indiana, Thomas B. Jeffery, of Wisconsin. The first production car in the United States was the Duryea, built by Frank and Charles Duryea in Massachusetts, but they were from Illinois. When Chrysler Corp. acquired American Motors in 1987, the Chrysler branch of the automotive family tree took on the numerous ancestors of AMC in combination with its own complex heritage. GM's branch already contains hundreds of companies through acquisition.

And the three surviving American auto makers -- out of literally thousands -- can all trace common ancestry back to the turn-of-the-century machine shops of Leland & Faulconer and John and Horace Dodge.

Copyright 1996, Richard A. Wright
Published by Wayne State University's Department of Communications