1908 "Tin Lizzie" rolls off the line

Henry Ford's first Model T, affectionately known as the "Tin Lizzie," rolled off the assembly line in Detroit, Michigan. The Model T revolutionized the automotive industry by providing an affordable, reliable car for the average American. Prior to the invention of the Model T, most automobiles were viewed as playthings of the rich. Ford was able to keep the price down by retaining control of all raw materials, as well as his use of new mass production methods. When it was first introduced, the "Tin Lizzie" cost only $850 and seated two people. Though the price fluctuated in the years to come, dipping as low as $290 in 1924, few other changes were ever made to the Model T. Electric lights were introduced in 1915, and an electric starter was introduced as an option in 1919. Eventually, the Model T's design stagnancy cost it its competitive edge, and Ford stopped manufacturing the "Tin Lizzie" in 1927.

Ford Motor Company

At age 40, Ford, with 11 other investors and $28,000 in capital, incorporated the Ford Motor Company in 1903. In a newly-designed car, Ford drove an exhibition in which the car covered the distance of a mile on the ice of Lake St. Clair in 39.4 seconds, which was a new land speed record. Convinced by this success, the famous race driver Barney Oldfield, who named this new Ford model "999" in honor of a racing locomotive of the day, took the car around the country and thereby made the Ford brand known throughout the United States. Ford was also one of the early backers of the Indianapolis 500.

Ford astonished the world in 1914 by offering a $5 a day wage that more than doubled the rate of most of his workers. The move proved hugely profitable. Instead of constant turnover of employees, the best mechanics in Detroit flocked to Ford, bringing in their human capital and expertise, raising productivity, and lowering training costs. Ford called it 'wage motive.' The company's use of vertical integration also proved successful, as Ford built a gigantic factory that shipped in raw materials and shipped out finished automobiles.

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The Model T

The Model T was introduced on October 1, 1908. It had many important innovations--such as the steering wheel on the left, which every other company soon copied. The entire engine and transmission were enclosed; the 4 cylinders were cast in a solid block; the suspension used two semi-elliptic springs. The car was very simple to drive, and--more important--easy and cheap to repair. It was so cheap at $825 in 1908 (the price fell every year) that by the 1920s a majority of American drivers learned to drive on the Model T, leaving fond memories for millions. Ford created a massive publicity machine in Detroit to ensure every newspaper carried stories and ads about the new product. Ford's network of local dealers made the car ubiquitous in virtually every city in North America. 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 explore the countryside. Ford was always eager to sell to farmers, who looked on the vehicle as a commercial device to help their business. Sales skyrocketed--several years posted 100+% gains on the previous year. Always on the hunt for more efficiency and lower costs, in 1913 Ford introduced the moving assembly belts into his plants, which enabled an enormous increase in production. Sales passed 250,000 in 1914. Although Henry Ford is often credited with the idea, contemporary sources indicate that the concept and its development came from employees Clarence Avery, Peter E. Martin, Charles E. Sorensen, and C.H. Wills. (See Piquette Plant) By 1916, as the price dropped to $360 for the basic touring car, sales reached 472,000. [5]

Ford Assembly Line, 1913

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Ford Assembly Line, 1913

By 1918, half of all cars in America were Model T's. As Ford wrote in his autobiography, "Any customer can have a car painted any colour that he wants so long as it is black"[6]. Until the development of the assembly line which mandated black because of its quicker drying time, Model Ts were available in other colors including red. The design was fervently promoted and defended by Henry Ford, and production continued as late as 1927; the final total production was exactly 15,000,000. This was a record which stood for the next 45 years.

In 1918 President Woodrow Wilson personally asked Ford to run for the Senate from Michigan as a Democrat. Although the nation was at war Ford ran as a peace candidate and a strong supporter of the proposed League of Nations. Ford lost by 1%. [7]. In December 1918 Henry Ford turned the presidency of Ford Motor Company over to his son Edsel Ford. Henry, however, retained final decision authority and sometimes reversed his son. Henry and Edsel purchased all remaining stock from other investors, thus giving the family sole ownership of the company.

By the mid 1920s, sales of the Model T began to decline due to rising competition. Other auto makers offered payment plans through which consumers could buy their cars, which usually included more modern mechanical features and styling not available with the Model T. Despite urgings from Edsel, Henry steadfastly refused to incorporate new features into the Model T or to form a customer credit plan.

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