Ford Motor Company was founded by the late Henry Ford in 1903. A century after, the company withstood wars, depression and competition. It is the fifth largest company to date based on worldwide car sales. But just like most businesses, Ford started small. The company had to overcome a lot of struggles and pass several stages and changes in its history.
Henry Ford left home at an early age and worked as an apprentice in some automotive companies until he decided to have one of his own. He founded the Detroit Automobile Company in 1899 and renamed as the Henry Ford Company in 1901. As cases with most starters, he encountered financial difficulties and had to leave the company.
Leaving the company paved the way to his success. As Ford once said, “Failure is simply the opportunity to begin again, this time more intelligently.” Living with this principle, he tried again and founded what we now know as Ford Motor Company. He also introduced the then unheard of ‘assembly line’ for his car manufacturing and changed the game for the car industry.
Cars at that time were limited to people of wealth. Though transportation was a daily cadence by people from all walks of life, it was considered an expensive toy for the rich. Car production was still in its infanthood, and production costs were sky high. Thus, owning a car was exclusive for the rich. Until Ford’s assembly line.
Henry Ford founded Ford Motor Company with the vision of making quality cars generally available and affordable for the majority. This American dream was not as easy as it sounded. The company started producing automobiles the traditional way, but with the time it was taking to finish a unit along with the materials needed, they had no choice but to compensate these expenses towards the price of their cars. Each automobile needed roughly 12 hours to complete which was costing the company labor and time.
So, Ford started another approach on making cars. He identified stages or steps to creating a unit. Then, he disseminated his workers to specialize on a certain stage. And using a machine similar to a conveyor belt, the cars were moved from one stage to another until all parts were placed. This method significantly decreased labor from the traditional 12-hour period down to 2 hours and 30 minutes. The system decreased the costs and so the car price. Model T, their most popular car unit, had its price reduced from $850 to $290.
This new system totally changed the game of automobile industry, from cars being a luxury item exclusive for the rich to being an affordable necessity available for everyone. Ford Motors sales skyrocketed until they were supplying 50% of all cars in the US. But, contrary to the positive reaction of the consumers, other car companies’ sales plummeted to rock bottom.
When Ford implemented the new system, the entire car industry was indignant at Ford for changing the eco-system of the industry. When the Great Depression struck America, 183 out of 200 automobile companies declared bankruptcy. Other car companies knew they had to do something to survive. GM went to the route of creating more personalized cars, Chrysler and Chevrolet started manufacturing automobiles with more creative features while others looked for better ways of assembling cars. Ford survived the Depression.
Ford Motor Company is history itself. It has experienced successes and failures, but through the collective effort of all the people behind it, the company has survived even the greatest war. Along with it, they’ve learned to be innovative, versatile and adaptable to the changes of the world. These have made Ford the mighty company we now see 103 years after it was founded in 1903.