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With the help of C. Harold Wills, Ford designed, built, and successfully raced a 26-horsepower automobile in October 1901. With this success, Murphy and other stockholders in the Detroit Automobile Company formed the Henry Ford Company on November 30, 1901, with Ford as chief engineer. In 1902, Murphy brought inHenry M. Leland as a consultant; Ford, in response, left the company bearing his name. With Ford gone, Murphy renamed the company the Cadillac Automobile Company.
Teaming up with former racing cyclist Tom Cooper, Ford also produced the 80+ horsepower racer "999" which Barney Oldfield was to drive to victory in a race in October 1902. Ford received the backing of an old acquaintance, Alexander Y. Malcomson, a Detroit-area coal dealer. They formed a partnership, "Ford & Malcomson, Ltd." to manufacture automobiles. Ford went to work designing an inexpensive automobile, and the duo leased a factory and contracted with a machine shop owned by John and Horace E. Dodge to supply over $160,000 in parts. Sales were slow, and a crisis arose when the Dodge brothers demanded payment for their first shipment.
Ford Motor Company
Henry Ford with Thomas Edisonand Harvey Firestone. Ft. Myers, Florida, February 11, 1929.
In response, Malcomson brought in another group of investors and convinced the Dodge Brothers to accept a portion of the new company. Ford & Malcomson was reincorporated as the Ford Motor Company on June 16, 1903, with $28,000 capital. The original investors included Ford and Malcomson, the Dodge brothers, Malcomson's uncle John S. Gray, Malcolmson's secretary James Couzens, and two of Malcomson's lawyers, John W. Anderson and Horace Rackham. Ford then demonstrated a newly-designed car on the ice of Lake St. Clair, driving 1 mile (1.6 km) in 39.4 seconds and setting a new land speed record at 91.3 miles per hour (147.0 km/h). Convinced by this success, the race driver Barney Oldfield, who named this new Ford model "999" in honor of the fastest locomotive of the day, took the car around the country, making the Ford brand known throughout the United States. Ford also was one of the early backers of the Indianapolis 500.
Model T
The Model T was introduced on October 1, 1908. It had the steering wheel on the left, which every other company soon copied. The entire engine and transmission were enclosed; the four cylinders were cast in a solid block; the suspension used two semi-elliptic springs. The car was very simple to drive, and easy and cheap to repair. It was so cheap at $825 in 1908 ($21,340 today) (the price fell every year) that by the 1920s, a majority of American drivers had learned to drive on the Model T.
As independent dealers, the franchises grew rich and publicized not just the Ford but the very concept of automobiling; local motor clubs sprang up to help new drivers and to encourage exploring the countryside.
Ford Assembly Line, 1913Sales passed 250,000 in 1914. By 1916, as the price dropped to $360 for the basic touring car, sales reached 472,000.(Using the consumer price index, this price was equivalent to $7,020 in 2008 dollars.)
Model A and Ford's later career
By 1926, flagging sales of the Model T finally convinced Henry to make a new model. He pursued the project with a great deal of technical expertise in design of the engine, chassis, and other mechanical necessities, while leaving the body design to his son. Edsel also managed to prevail over his father's initial objections in the inclusion of a sliding-shift transmission.
The result was the successful Ford Model A, introduced in December 1927 and produced through 1931, with a total output of more than 4 million.
Ford did not believe in accountants; he amassed one of the world's largest fortunes without ever having his company audited under his administration.
Labor philosophy
The five-dollar workday
Time Magazine, January 14, 1935.Ford was a pioneer of "welfare capitalism", designed to improve the lot of his workers and especially to reduce theheavyturnover that had many departments hiring 300 men per year to fill 100 slots. Efficiency meant hiring and keeping the best workers.
Ford astonished the world in 1914 by offering a $5 per day wage ($120 today), which more than doubled the rate of most of his workers. Ford and Crowther in 1922 described it as six 8-hour days, giving a 48-hour week, while in 1926 they described it as five 8-hour days, giving a 40-hour week. (Apparently the program started with Saturdays as workdays and sometime later it was changed to a day off.)
Detroit was already a high-wage city, but competitors were forced to raise wages or lose their best workers. Ford's policy proved, however, that paying people more would enable Ford workers to afford the cars they were producing and be good for the economy. Ford explained the policy as profit-sharing rather than wages. It may have been Couzens who convinced Ford to adopt the $5 day.
Ford Airplane Company
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