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progress is going to fling him off.
There is also the great fear of being thought a fool. So many men are
afraid of being considered fools. I grant that public opinion is a
powerful police influence for those who need it. Perhaps it is true that
the majority of men need the restraint of public opinion. Public opinion
may keep a man better than he would otherwise be--if not better morally,
at least better as far as his social desirability is concerned. But it
is not a bad thing to be a fool for righteousness' sake. The best of it
is that such fools usually live long enough to prove that they were not
fools--or the work they have begun lives long enough to prove they were
The money influence--the pressing to make a profit on an
"investment"--and its consequent neglect of or skimping of work and
hence of service showed itself to me in many ways. It seemed to be at
the bottom of most troubles. It was the cause of low wages--for without
well-directed work high wages cannot be paid. And if the whole attention
is not given to the work it cannot be well directed. Most men want to be
free to work; under the system in use they could not be free to work.
During my first experience I was not free--I could not give full play to
my ideas. Everything had to be planned to make money; the last
consideration was the work. And the most curious part of it all was the
insistence that it was the money and not the work that counted. It did
not seem to strike any one as illogical that money should be put ahead
of work--even though everyone had to admit that the profit had to come
from the work. The desire seemed to be to find a short cut to money and
to pass over the obvious short cut--which is through the work.
Take competition; I found that competition was supposed to be a menace
and that a good manager circumvented his competitors by getting a
monopoly through artificial means. The idea was that there were only a
certain number of people who could buy and that it was necessary to get
their trade ahead of someone else. Some will remember that later many of
the automobile manufacturers entered into an association under the
Selden Patent just so that it might be legally possible to control the
price and the output of automobiles. They had the same idea that so many
trades unions have--the ridiculous notion that more profit can be had
doing less work than more. The plan, I believe, is a very antiquated
one. I could not see then and am still unable to see that there is not
always enough for the man who does his work; time spent in fighting
competition is wasted; it had better be spent in doing the work. There
are always enough people ready and anxious to buy, provided you supply
what they want and at the proper price--and this applies to personal
services as well as to goods.
During this time of reflection I was far from idle. We were going ahead
with a four-cylinder motor and the building of a pair of big racing
cars. I had plenty of time, for I never left my business. I do not
believe a man can ever leave his business. He ought to think of it by
day and dream of it by night. It is nice to plan to do one's work in
office hours, to take up the work in the morning, to drop it in the
evening--and not have a care until the next morning. It is perfectly
possible to do that if one is so constituted as to be willing through
all of his life to accept direction, to be an employee, possibly a
responsible employee, but not a director or manager of anything. A
manual labourer must have a limit on his hours, otherwise he will wear
himself out. If he intends to remain always a manual labourer, then he
should forget about his work when the whistle blows, but if he intends
to go forward and do anything, the whistle is only a signal to start
thinking over the day's work in order to discover how it might be done
The man who has the largest capacity for work and thought is the man who
is bound to succeed. I cannot pretend to say, because I do not know,
whether the man who works always, who never leaves his business, who is
absolutely intent upon getting ahead, and who therefore does get
ahead--is happier than the man who keeps office hours, both for his
brain and his hands. It is not necessary for any one to decide the
question. A ten-horsepower engine will not pull as much as a twenty. The
man who keeps brain office hours limits his horsepower. If he is
satisfied to pull only the load that he has, well and good, that is his
affair--but he must not complain if another who has increased his
horsepower pulls more than he does. Leisure and work bring different
results. If a man wants leisure and gets it--then he has no cause to
complain. But he cannot have both leisure and the results of work.
Concretely, what I most realized about business in that year--and I have
been learning more each year without finding it necessary to change my
first conclusions--is this:
(1) That finance is given a place ahead of work and therefore tends to
kill the work and destroy the fundamental of service.
(2) That thinking first of money instead of work brings on fear of
failure and this fear blocks every avenue of business--it makes a man
afraid of competition, of changing his methods, or of doing anything
which might change his condition.
(3) That the way is clear for any one who thinks first of service--of
doing the work in the best possible way.
STARTING THE REAL BUSINESS
In the little brick shop at 81 Park Place I had ample opportunity to
work out the design and some of the methods of manufacture of a new car.
Even if it were possible to organize the exact kind of corporation that
I wanted--one in which doing the work well and suiting the public would
be controlling factors--it became apparent that I never could produce a
thoroughly good motor car that might be sold at a low price under the
existing cut-and-try manufacturing methods.
Everybody knows that it is always possible to do a thing better the
second time. I do not know why manufacturing should not at that time
have generally recognized this as a basic fact--unless it might be that
the manufacturers were in such a hurry to obtain something to sell that
they did not take time for adequate preparation. Making "to order"
instead of making in volume is, I suppose, a habit, a tradition, that
has descended from the old handicraft days. Ask a hundred people how
they want a particular article made. About eighty will not know; they
will leave it to you. Fifteen will think that they must say something,
while five will really have preferences and reasons. The ninety-five,
made up of those who do not know and admit it and the fifteen who do not
know but do not admit it, constitute the real market for any product.
The five who want something special may or may not be able to pay the
price for special work. If they have the price, they can get the work,
but they constitute a special and limited market. Of the ninety-five
perhaps ten or fifteen will pay a price for quality. Of those remaining,
a number will buy solely on price and without regard to quality. Their
numbers are thinning with each day. Buyers are learning how to buy. The
majority will consider quality and buy the biggest dollar's worth of
quality. If, therefore, you discover what will give this 95 per cent. of
people the best all-round service and then arrange to manufacture at the
very highest quality and sell at the very lowest price, you will be
meeting a demand which is so large that it may be called universal.
This is not standardizing. The use of the word "standardizing" is very
apt to lead one into trouble, for it implies a certain freezing of
design and method and usually works out so that the manufacturer selects
whatever article he can the most easily make and sell at the highest
profit. The public is not considered either in the design or in the
price. The thought behind most standardization is to be able to make a
larger profit. The result is that with the economies which are
inevitable if you make only one thing, a larger and larger profit is
continually being had by the manufacturer. His output also becomes
larger--his facilities produce more--and before he knows it his markets
are overflowing with goods which will not sell. These goods would sell
if the manufacturer would take a lower price for them. There is always
buying power present--but that buying power will not always respond to
reductions in price. If an article has been sold at too high a price and
then, because of stagnant business, the price is suddenly cut, the
response is sometimes most disappointing. And for a very good reason.
The public is wary. It thinks that the price-cut is a fake and it sits
around waiting for a real cut. We saw much of that last year. If, on the
contrary, the economies of making are transferred at once to the price
and if it is well known that such is the policy of the manufacturer, the
public will have confidence in him and will respond. They will trust him
to give honest value. So standardization may seem bad business unless it
carries with it the plan of constantly reducing the price at which the
article is sold. And the price has to be reduced (this is very
important) because of the manufacturing economies that have come about
and not because the falling demand by the public indicates that it is
not satisfied with the price. The public should always be wondering how
it is possible to give so much for the money.
Standardization (to use the word as I understand it) is not just taking
one's best selling article and concentrating on it. It is planning day
and night and probably for years, first on something which will best
suit the public and then on how it should be made. The exact processes
of manufacturing will develop of themselves. Then, if we shift the
manufacturing from the profit to the service basis, we shall have a real
business in which the profits will be all that any one could desire.
All of this seems self-evident to me. It is the logical basis of any
business that wants to serve 95 per cent. of the community. It is the
logical way in which the community can serve itself. I cannot comprehend
why all business does not go on this basis. All that has to be done in
order to adopt it is to overcome the habit of grabbing at the nearest
dollar as though it were the only dollar in the world. The habit has
already to an extent been overcome. All the large and successful retail
stores in this country are on the one-price basis. The only further step
required is to throw overboard the idea of pricing on what the traffic
will bear and instead go to the common-sense basis of pricing on what it
costs to manufacture and then reducing the cost of manufacture. If the
design of the product has been sufficiently studied, then changes in it
will come very slowly. But changes in manufacturing processes will come
very rapidly and wholly naturally. That has been our experience in
everything we have undertaken. How naturally it has all come about, I
shall later outline. The point that I wish to impress here is that it is
impossible to get a product on which one may concentrate unless an
unlimited amount of study is given beforehand. It is not just an
These ideas were forming with me during this year of experimenting. Most
of the experimenting went into the building of racing cars. The idea in
those days was that a first-class car ought to be a racer. I never
really thought much of racing, but following the bicycle idea, the
manufacturers had the notion that winning a race on a track told the
public something about the merits of an automobile--although I can
hardly imagine any test that would tell less.
But, as the others were doing it, I, too, had to do it. In 1903, with
Tom Cooper, I built two cars solely for speed. They were quite alike.
One we named the "999" and the other the "Arrow." If an automobile were
going to be known for speed, then I was going to make an automobile that
would be known wherever speed was known. These were. I put in four great
big cylinders giving 80 H.P.--which up to that time had been unheard of.
The roar of those cylinders alone was enough to half kill a man. There
was only one seat. One life to a car was enough. I tried out the cars.
Cooper tried out the cars. We let them out at full speed. I cannot quite
describe the sensation. Going over Niagara Falls would have been but a
pastime after a ride in one of them. I did not want to take the
responsibility of racing the "999" which we put up first, neither did
Cooper. Cooper said he knew a man who lived on speed, that nothing could
go too fast for him. He wired to Salt Lake City and on came a
professional bicycle rider named Barney Oldfield. He had never driven a
motor car, but he liked the idea of trying it. He said he would try
It took us only a week to teach him how to drive. The man did not know
what fear was. All that he had to learn was how to control the monster.
Controlling the fastest car of to-day was nothing as compared to
controlling that car. The steering wheel had not yet been thought of.
All the previous cars that I had built simply had tillers. On this one I
put a two-handed tiller, for holding the car in line required all the
strength of a strong man. The race for which we were working was at
three miles on the Grosse Point track. We kept our cars as a dark horse.
We left the predictions to the others. The tracks then were not
scientifically banked. It was not known how much speed a motor car could
develop. No one knew better than Oldfield what the turns meant and as he
took his seat, while I was cranking the car for the start, he remarked
cheerily: "Well, this chariot may kill me, but they will say afterward
that I was going like hell when she took me over the bank."
And he did go.... He never dared to look around. He did not shut off on
the curves. He simply let that car go--and go it did. He was about half
a mile ahead of the next man at the end of the race!
The "999" did what it was intended to do: It advertised the fact that I
could build a fast motorcar. A week after the race I formed the Ford
Motor Company. I was vice-president, designer, master mechanic,
superintendent, and general manager. The capitalization of the company
was one hundred thousand dollars, and of this I owned 25 1/2 per cent.
The total amount subscribed in cash was about twenty-eight thousand
dollars--which is the only money that the company has ever received for
the capital fund from other than operations. In the beginning I thought
that it was possible, notwithstanding my former experience, to go
forward with a company in which I owned less than the controlling share.
I very shortly found I had to have control and therefore in 1906, with
funds that I had earned in the company, I bought enough stock to bring
my holdings up to 51 per cent, and a little later bought enough more to
give me 58-1/2 per cent. The new equipment and the whole progress of the
company have always been financed out of earnings. In 1919 my son Edsel
purchased the remaining 41-1/2 per cent of the stock because certain of
the minority stockholders disagreed with my policies. For these shares
he paid at the rate of $12,500 for each $100 par and in all paid about
The original company and its equipment, as may be gathered, were not
elaborate. We rented Strelow's carpenter shop on Mack Avenue. In making
my designs I had also worked out the methods of making, but, since at
that time we could not afford to buy machinery, the entire car was made
according to my designs, but by various manufacturers, and about all we
did, even in the way of assembling, was to put on the wheels, the tires,
and the body. That would really be the most economical method of
manufacturing if only one could be certain that all of the various parts
would be made on the manufacturing plan that I have above outlined. The
most economical manufacturing of the future will be that in which the
whole of an article is not made under one roof--unless, of course, it be
a very simple article. The modern--or better, the future--method is to
have each part made where it may best be made and then assemble the
parts into a complete unit at the points of consumption. That is the
method we are now following and expect to extend. It would make no
difference whether one company or one individual owned all the factories
fabricating the component parts of a single product, or whether such
part were made in our independently owned factory, _if only all adopted
the same service methods_. If we can buy as good a part as we can make
ourselves and the supply is ample and the price right, we do not attempt
to make it ourselves--or, at any rate, to make more than an emergency
supply. In fact, it might be better to have the ownership widely
I had been experimenting principally upon the cutting down of weight.
Excess weight kills any self-propelled vehicle. There are a lot of fool
ideas about weight. It is queer, when you come to think of it, how some
fool terms get into current use. There is the phrase "heavyweight" as
applied to a man's mental apparatus! What does it mean? No one wants to
be fat and heavy of body--then why of head? For some clumsy reason we
have come to confuse strength with weight. The crude methods of early
building undoubtedly had much to do with this. The old ox-cart weighed a
ton--and it had so much weight that it was weak! To carry a few tons of
humanity from New York to Chicago, the railroad builds a train that
weighs many hundred tons, and the result is an absolute loss of real
strength and the extravagant waste of untold millions in the form of
power. The law of diminishing returns begins to operate at the point
where strength becomes weight. Weight may be desirable in a steam roller
but nowhere else. Strength has nothing to do with weight. The mentality
of the man who does things in the world is agile, light, and strong. The
most beautiful things in the world are those from which all excess
weight has been eliminated. Strength is never just weight--either in men
or things. Whenever any one suggests to me that I might increase weight
or add a part, I look into decreasing weight and eliminating a part! The
car that I designed was lighter than any car that had yet been made. It
would have been lighter if I had known how to make it so--later I got
the materials to make the lighter car.
In our first year we built "Model A," selling the runabout for eight
hundred and fifty dollars and the tonneau for one hundred dollars more.
This model had a two-cylinder opposed motor developing eight horsepower.
It had a chain drive, a seventy-two inch wheel base--which was supposed
to be long--and a fuel capacity of five gallons. We made and sold 1,708
cars in the first year. That is how well the public responded.
Every one of these "Model A's" has a history. Take No. 420. Colonel D.
C. Collier of California bought it in 1904. He used it for a couple of
years, sold it, and bought a new Ford. No. 420 changed hands frequently
until 1907 when it was bought by one Edmund Jacobs living near Ramona in
the heart of the mountains. He drove it for several years in the
roughest kind of work. Then he bought a new Ford and sold his old one.
By 1915 No. 420 had passed into the hands of a man named Cantello who
took out the motor, hitched it to a water pump, rigged up shafts on the
chassis and now, while the motor chugs away at the pumping of water, the
chassis drawn by a burro acts as a buggy. The moral, of course, is that
you can dissect a Ford but you cannot kill it.
In our first advertisement we said:
Our purpose is to construct and market an automobile specially
designed for everyday wear and tear--business, professional, and
family use; an automobile which will attain to a sufficient speed to
satisfy the average person without acquiring any of those breakneck
velocities which are so universally condemned; a machine which will
be admired by man, woman, and child alike for its compactness, its
simplicity, its safety, its all-around convenience, and--last but
not least--its exceedingly reasonable price, which places it within
the reach of many thousands who could not think of paying the
comparatively fabulous prices asked for most machines.
And these are the points we emphasized:
Simplicity--most of the cars at that time required considerable skill in
The ignition--which was furnished by two sets of six dry cell batteries.
The automatic oiling.
The simplicity and the ease of control of the transmission, which was of
the planetary type.
We did not make the pleasure appeal. We never have. In its first
advertising we showed that a motor car was a utility. We said:
We often hear quoted the old proverb, "Time is money"--and yet how few
business and professional men act as if they really believed its truth.
Men who are constantly complaining of shortage of time and lamenting the
fewness of days in the week--men to whom every five minutes wasted means
a dollar thrown away--men to whom five minutes' delay sometimes means
the loss of many dollars--will yet depend on the haphazard,
uncomfortable, and limited means of transportation afforded by street
cars, etc., when the investment of an exceedingly moderate sum in the
purchase of a perfected, efficient, high-grade automobile would cut out
anxiety and unpunctuality and provide a luxurious means of travel ever
at your beck and call.
Always ready, always sure.
Built to save you time and consequent money.
Built to take you anywhere you want to go and bring you back again on
Built to add to your reputation for punctuality; to keep your customers
good-humoured and in a buying mood.
Built for business or pleasure--just as you say.
Built also for the good of your health--to carry you "jarlessly" over
any kind of half decent roads, to refresh your brain with the luxury of
much "out-doorness" and your lungs with the "tonic of tonics"--the right
kind of atmosphere.
It is your say, too, when it comes to speed. You can--if you
choose--loiter lingeringly through shady avenues or you can press down
on the foot-lever until all the scenery looks alike to you and you have
to keep your eyes skinned to count the milestones as they pass.
I am giving the gist of this advertisement to show that, from the
beginning, we were looking to providing service--we never bothered with
a "sporting car."
The business went along almost as by magic. The cars gained a reputation
for standing up. They were tough, they were simple, and they were well
made. I was working on my design for a universal single model but I had
not settled the designs nor had we the money to build and equip the
proper kind of plant for manufacturing. I had not the money to discover
the very best and lightest materials. We still had to accept the
materials that the market offered--we got the best to be had but we had
no facilities for the scientific investigation of materials or for
My associates were not convinced that it was possible to restrict our
cars to a single model. The automobile trade was following the old
bicycle trade, in which every manufacturer thought it necessary to bring
out a new model each year and to make it so unlike all previous models
that those who had bought the former models would want to get rid of the
old and buy the new. That was supposed to be good business. It is the
same idea that women submit to in their clothing and hats. That is not
service--it seeks only to provide something new, not something better.
It is extraordinary how firmly rooted is the notion that
business--continuous selling--depends not on satisfying the customer
once and for all, but on first getting his money for one article and
then persuading him he ought to buy a new and different one. The plan
which I then had in the back of my head but to which we were not then
sufficiently advanced to give expression, was that, when a model was
settled upon then every improvement on that model should be
interchangeable with the old model, so that a car should never get out
of date. It is my ambition to have every piece of machinery, or other
non-consumable product that I turn out, so strong and so well made that
no one ought ever to have to buy a second one. A good machine of any
kind ought to last as long as a good watch.
In the second year we scattered our energies among three models. We made
a four-cylinder touring car, "Model B," which sold for two thousand
dollars; "Model C," which was a slightly improved "Model A" and sold at
fifty dollars more than the former price; and "Model F," a touring car
which sold for a thousand dollars. That is, we scattered our energy and
increased prices--and therefore we sold fewer cars than in the first
year. The sales were 1,695 cars.
That "Model B"--the first four-cylinder car for general road use--had to
be advertised. Winning a race or making a record was then the best kind
of advertising. So I fixed up the "Arrow," the twin of the old "999"--in
fact practically remade it--and a week before the New York Automobile
show I drove it myself over a surveyed mile straightaway on the ice. I
shall never forget that race. The ice seemed smooth enough, so smooth
that if I had called off the trial we should have secured an immense
amount of the wrong kind of advertising, but instead of being smooth,
that ice was seamed with fissures which I knew were going to mean
trouble the moment I got up speed. But there was nothing to do but go
through with the trial, and I let the old "Arrow" out. At every fissure
the car leaped into the air. I never knew how it was coming down. When I
wasn't in the air, I was skidding, but somehow I stayed top side up and
on the course, making a record that went all over the world! That put