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shares to either father or son before they
lost their value. With all of the company’s
assets now under family control, Ford
went on to acquire the premium car
manufacturer Lincoln Motor. However,
Ford senior showed scant enthusiasm
for the luxury sector, leaving the
management of the Lincoln side of the
business to his son.
But the market was changing, and
although Ford could see no reason for
changing the Model T that had been in
production for 16 years, competition from
General Motors (especially in the form of
their stylish entry-level Chevrolet) and a
decline in sales meant that Ford needed
a strategic rethink. His response was to
cease production of the Model T and to
build a greenfi eld site assembly plant at
River Rouge that would manufacture
the new Model A. River Rouge was to
become the largest industrial complex
in the world and adopted vertical
integration to the point that it produced
its own steel. Introduced in 1927, the
51 April 2020 / www.theengineer.co.uk
was to come into its own when the
Model T was launched in 1908. Ford
personally saw to it that newspapers
across the nation carried editorial and
advertising about a new car that was
simple to drive and easy to repair. With
a network of dealers and a unit price
that decreased with every passing year,
the $825 car introduced the idea of
‘automobiling’ as a leisure concept to
America. Sales went through the roof
(often with year-on-year increases of 100
percent) and to cope with demand the
company introduced new production
and manufacturing methods such as
moving assembly belts. By 1918 Ford
was so recognisable that President
Woodrow Wilson invited him to stand
as a Democrat candidate for the United
States Senate. Running as a pacifi st
and supporter of the League of Nations,
Ford lost the election to a former United
States Secretary to the Navy.
After the end of the First World War
Ford decided to take control of his own
business by buying out his stockholders.
To do this he set up a new company –
Henry Ford and Son – while confusingly
leaving his son Edsel at the helm of the
Ford Motor Company. The idea was to
create suffi cient market uncertainty to
fi nesse his stockholders into selling their
Ford’s iconic Model T is one of the best
selling cars of all time
new car went on to sell four million units and by 1932 Ford was
manufacturing a third of the world’s cars. River Rouge heralded
a change in corporate philosophy that allowed an annual model
change system to be put in place (as pioneered by GM) and the
introduction of car fi nance plans. This la er innovation was
a volte-face for a man who distrusted accountants and had
amassed his lifetime wealth of $200bn without ever having his
company audited. In fact, there was a persistent rumour that
Ford estimated his corporation’s monthly fi nancial position by
the weight of his bills and invoices.
Despite his disregard for conventional accounting and
his reluctance to build anything other than cheap cars, (he
briefl y produced aeroplanes, notably the ‘Tin Goose’ 4AT
Trimotor), Ford was something of a visionary in terms of labour
philosophy. A champion of welfare capitalism, he advocated
the improvement of workforce conditions and compensation.
In 1914 he introduced his $5-per-day programme that raised the
minimum daily pay from $2.34 to more than double, resulting
in an infl ux of experienced mechanics to Detroit. What Ford
lost on higher wages, he more than made up with increased
productivity and reduced training expenditure. He introduced
profi t-sharing, albeit contingent on the recipients having their
private lives examined and approved of by the company’s ‘social
department’ (an incursion that Ford was later to regret.) In
1926 he introduced the 5-day, 40-hour working week, a change
Be ready to revise any system, scrap any method,
abandon any theory, if the success of the job requires it
Henry Ford
based partially on self-interest (more leisure time
meant that his workers would buy more cars), and
altruism (“It is high time to rid ourselves of the notion
that leisure for workmen is either ‘lost time’ or a
class privilege.”) And yet, Ford was against workers’
unions, believing that they were essentially in place
to put a brake on productivity in order to create more
employment opportunities – a situation he regarded as
paradoxical, believing as he did that productivity was a
necessary condition for economic prosperity to exist.
This is where the offi cial Henry Ford story usually
starts to wrap up, with the most infl uential phases of
his career behind him. But life for Ford went on with
continued automobile manufacture in the 1930s, the
return to the presidency of the Ford Motor Company
following the death of his son in 1943 and support of
the Second World War eff ort, followed by his death at
home in 1947 at the age of 83. But Ford’s extraordinary
life wasn’t without stain. One of the prime movers of the
American Dream, he was also a lifelong anti-Semite and
sponsor of the controversial newspaper The Dearborn
Independent that was carried and distributed by every
Ford franchise nationwide. He also had the dubious
honour of being the only American singled out by name
for praise in Adolf Hitler’s book Mein Kampf.
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