#20. Henry Ford

“I will build a car for the great multitude. It will be large enough for the family, but small enough for the individual to run and care for. It will be constructed of the best materials, by the best men to be hired, after the simplest designs that modern engineering can devise. But it will be so low in price that no man making a good salary will be unable to own one.” –Henry Ford

When I conceived of this list, one of the first things I did was sort about a hundred contenders by profession. For the most part, each figure was easily placed under categories like statesman, philosopher, scientist, or inventor.[1]

When I came to Henry Ford, however, I hesitated. Ford wasn’t exactly a scientist, nor can we say he was primarily an inventor. He didn’t invent the car, the combustion engine, the assembly line, mass production, or interchangeable parts. Though he was a tinkerer, no invention of his changed the world.

And yet, change the world he did. It’s hard to classify Henry Ford as anything—except, perhaps, as the 20th most influential figure in Western history.

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The automobile, dubbed a “horseless carriage” by contemporaries, was invented in 1885 by German inventor Karl Benz.[2] By then, Henry Ford had lived 22 years in a slow-moving world. He grew up the son of a farmer, William Ford, who had hoped that Henry would someday take over their farm in Dearborn, Michigan. If that was William’s goal, then he erred when he gifted a 15-year-old Henry a pocket watch. The boy dismantled it then put it back together. After then doing the same to watches of friends and family, he felt his calling was as a machinist. He dropped out of school at 16, moved to Detroit, and worked as a machinist’s apprentice and a repairman. In 1896, at the age of 33, he designed his first car, a two-cylinder, 4-horsepower vehicle he called the “Ford Quadricycle.”[3] He sold it for $200, and used the money to start a business, which didn’t take. Another failed business venture later, he was 40 years old and nowhere near influential.

But then he was visited by the American dream. He tried again. In 1903, with the help of Alexander Y. Malcomson, an old friend and Detroit coal dealer who was impressed by Ford’s latest automobile design (which racer Barney Oldfield had driven to a racing cup’s first place), they started the Ford Motor Company. Oldfield’s successes helped attract investors, and Ford worked on improving his design.

Ford’s greatest gift at this early stage of his career was that of an analyst. He studied how cars were created, how they functioned, and, just as important, how their parts were created and functioned. By 1908, he used the industrial trends of assembly lines and interchangeable parts to assemble a car more quickly than anyone had done before. Earlier in the decade, it took nearly 13 hours to assemble his car model. By the end of the decade, his workers could follow 45 steps to manufacture an automobile in just over 90 minutes. Just five years into Ford Motor Company, he was ready to unveil the car that would change the world.[4]

Three years earlier, Ford’s investors had told him that the way to increase profits was to make a car that rich consumers felt compelled to buy. The rich, after all, had the disposable income during a time where the industrialization had excelled at suppressing the wages of expendable workers.

Ford had something else in mind. He felt that the way to maximize profit wasn’t to sell only to the tiny American upper class of the early 1900s. Rather, it was appealing to the millions of workers beneath them. Ford is often associated with mass production, and rightly so, but what is often overlooked is his ability to drive mass consumption. He didn’t want to build the car loved by the rich; he wanted to build the car loved by everyone.

What’s most fascinating about the original Model T is not its breakthrough affordable price; rather, it was how Ford was able to make its price so low and yet still make unprecedented profit. In order to make sure he could keep his cars affordable, he needed to cut every possible cost while still maintaining a safe and fluid environment that would not slow production.

Therefore, in addition to interchangeable parts and the assembly line, he created a sharp division of labor. Assembly line workers were not even responsible for getting parts, materials, or tools. Another worker did that for them. It was imperative not to waste a minute of a worker’s time, for that would slow the belt that needed constant motion to maximize production. He even reduced the time it took to get extra parts and materials to their proper locations. Instead of sending runners, intricate systems of slides and trolleys transported whatever was needed. Ford even standardized the height of the assembly belt; its placement was where it would be easiest for workers to stand for extended periods of time, eliminating time-consuming motions like bending over, reaching up, or complaining to one’s foreman about back pain.

He tirelessly analyzed the process and micromanaged his plants as if his entire life depended on that day’s batch of Model Ts. If a process could be simplified to save a second, Henry Ford ordered the simplification. The result was a worker who had only one task to do throughout the day, and this task likely took little to no training. Ford confronted all possible time-wasters and promptly reduced or eliminated them.

It should be noted that none of these tactics were invented by Ford. Frederick Winslow Taylor had already preached this method of meticulous analysis, called scientific management. The assembly line had been around for a century, as had interchangeable parts, the brainchild of Eli Whitney. Still, no one before Ford had combined and scaled these ideas so effectively.

Meanwhile, Ford unleashed yet another brilliant tactic to saturate the market with his cars. He gave his workers raises. As his production rate and sales climbed in the early 1910s, Ford could afford to pay his employees more. In 1914, he more than doubled their minimum wage to five dollars a day. Imagine getting your earnings doubled now, and you can imagine what this wage hike did to their disposable income. His workers joined a growing middle class, and with this extra income, they bought more cars. This strategy also increased worker loyalty and decreased worker turnover, which kept the company humming.

These policies epitomized two core tenants of the welfare capitalism adopted by later companies. Ford and Chrysler legend Lee Iacocca nicely sums up Ford and his raises: “He figured that if he paid his factory workers a real living wage and produced more cars in less time for less money, everyone would buy them. . . . It was a virtuous circle, and he was the ring master.”

Other factors contributed to Ford’s success. He understood advertising, for example. He also branched out into the rubber and steel industries to further control his means of production. The Model T, therefore, was produced at the lowest possible cost, and part of this savings could be lopped off its retail price. In 1908, one could buy the earliest Model Ts for $825 each. Over the next five years, the price plummeted to $500. By 1916, it was $360, and by 1924, it reached $260. As the price dropped, the sales climbed, sometimes doubling in a year. By 1918, ten years after the car’s debut, half the cars in the country were Model Ts. Henry Ford, drop-out son of a Dearborn farmer, became the richest man in America. The company ultimately sold 15 million Model Ts, a record for any car model until the 1970s.

By the late 1920s, after the Model T’s inevitable slowing of sales, Ford came out with the Model A. Though successful, the A was no T. The Model A marked the beginning of Ford’s slow decline from his two-decade long reign as America’s greatest businessman. The latter part of his life was marred by a failed Senate bid, an increasingly messy relationship with workers who wished to unionize, an upstart General Motors company that surpassed Ford Motor Company’s sales, a failed airline, accusations of anti-Semitism, and decreased mental acuity. The pall of the Great Depression didn’t help.

When his son and successor as Ford president, Edsel Ford, died in 1943, Henry, despite his 80 years and bouts with paranoia and cardiovascular problems, re-assumed command of the company. It went on to lose 10 million dollars a month.[5] By 1945, Ford re-retired, left the company to his grandson Henry Ford II, and died two years later.

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No, Henry Ford was not an inventor. He was an innovator. He didn’t invent the car; he reinvented it. By lowering costs and personifying efficiency, he was able to sell it to the common American, his employees first and foremost.

This approach to packaging and compensation ultimately rippled across the United States and Western world. The Industrial Revolution had already begun, but Ford threw industrialism into a higher gear.[6] He may have revolutionized transportation, but he brought other industries along for the ride.[7]

In 1908, when his factories produced a car every 90 minutes, that already stimulated other business sectors. By 1927, however, Ford Motor Co. was producing a car every 24 seconds. The secondary boons are incalculable. There are the obvious sectors of growth—car dealers and gas stations—but many other industries were happily caught up in his revolution. Car production catalyzed enormous growth in the steel, rubber, glass, and petroleum industries. Billions of dollars were poured into highway construction. In 1929, millions of American workers had the automobile to thank for their job. Ford had thrown the American economy into overdrive.[8]

Another important side effect was the rise of suburbia. Owning a car and the independent, flexible movement accompanied by one meant one could get out of the inner city and into the fresh air of a suburb. Real estate speculation benefited. When the first shopping center popped up in 1924 Kansas City, its customers used their Model Ts to get there.

A sizable middle class emerged. It was made up not only of Ford’s well-compensated workers but of individuals who could use the affordable automobile to get to work at the many growing industries. Auto sales in the U.S. totaled $1.5 million in 1921. By 1929, that number had quintupled. By 1930, there was nearly one car for every five Americans, and Americans owned 80 percent(!) of the world’s cars.

As wages rose during the 1920s, the middle class used its free time and excess income—both were a product of the rigid and hourly wage system instituted by Ford and others who emulated him—to stimulate other sectors of growth. For instance, AAA estimated that in 1929, one in three Americans took vacations by car. Americans were no longer isolated from each other. They more freely left rural homes and met for social occasions, sporting events, concerts, and movies. These industries, in turn, experienced growth as well. Even if the 1930s sidetracked this economic leap forward, the U.S. emerged on the other side of World War II as an industrialized nation on wheels.

Perhaps more than any other individual, Ford helped create this consumer culture. With the rise of disposable income and freedom of mobility came a higher standard of living and desire to spend. More than anyone else of the industrial era, it’s Ford that laid the foundation for a large American middle class that led to, by a long shot, the world’s largest economy.

Relevantly, Ford did not keep his production methods a secret. He wrote about them. He showed them off. Seeing a chance for good publicity, he invited people into his factories. Other manufactures emulated his tactics, and “Fordism” eventually branched out into other companies and industries. The rest of the West quickly caught on, and, in the past few decades, we’ve seen other parts of the world use similar methods to maximize production (if not compensation). Consequently, prices fell for products in almost every industry, and more affordability meant more members of the most comfortable middle class in history.

Although the latter part of his life stalled,[9] Ford should be proud of his legacy. There’s the rags-to-riches tale, but there’s also his gift of automobility. He gave freedom to a people that cherish it. Almost as dear to their hearts is the innovation, individualism, and profit motive that drove Ford and the American economy to the top of the GDP rankings for the better part of a century. It’s been quite the ride, and behind the wheel has been Henry Ford.[10]

For his unmatched contribution to American production and consumerism, Henry Ford is the 20th most influential figure in Western history.

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[1] Of those fields, the final breakdown included eleven political and military leaders, seven philosophers, six scientists, and four inventors.

[2] The Germans, as always, had the far more entertaining word for it: Motorwagen.

[3] We can’t all be German.

[4] The tireless work ethic that bred his success has, for a century now, been pointed to as epitomizing the American dream—from farmer drop-out to richest man in America, all by working hard, innovating, and never giving up.

[5] President Roosevelt considered a government takeover so as to guarantee constant production during World War II.

[6] Sorry.

[7] Again, I’m really sorry.

[8] They’re just too easy.

[9] Almost there.

[10] Last one. I promise.