Automotive industry

“ The taunt of unreliability once levelled—and with justice—at the motor-car, is fast losing its force, owing to the vast improvements in design and details which manufacturers have been stimulated to make. The motor-car industry has a great future before it, and the prizes therein are such as to tempt both inventor and engineer. Every week scores of patents are granted for devices which aim at the perfection of some part of a car, its tyres, its wheels, or its engines. ”

“ This combination of knowledge by the men engaged in it has made the automobile industry a record breaker in point of the time consumed in its development. It has made it stand out as unparalleled by any other industry in this country in the speed with which it progressed from final experimentation to an established recognized enterprise, involving mammoth investment of capital and huge profits. ”

“ Of the future of the automobile and of products allied with it or sharing in its construction and prosperity, as continuing money-makers, all indications are that the profits already taken out of the motor car industry in the United States are but placer croppings, and that the years to come will record the workings of the real vein. This real vein, in the opinion of the man who looks ahead, is in the use of passenger cars, haulage trucks and motor tractors by the fifty million of the population of this union of states who are on or of the farm. ”

“ Moreover, the automobile illustrates more completely than any other industry the technical qualities that so largely explain our industrial progress. Above all, American manufacturing has developed three characteristics. These are quantity production, standardization, and the use of labor-saving machinery. It is because Ford and other manufacturers adapted these principles to making the automobile that the American motor industry has reached such gigantic proportions. ”

“ There will come a time when the automobile industry will reach its height in production, but that time has not yet arrived, nor is it within calculable distance.
Statisticians show us that there are over 5,000,000 rich people in this country. Many of these have, and more of them will want, each several cars, each of a different type and for a different purpose. ”

“ This is a fundamental principle in the science of investment.
When the saturation point is reached manufacturing automobiles will settle into an industry153 to supply a daily necessity. There will be keener competition, the price of cars will be lowered, and the profit on each will be correspondingly less. The industry will be similar to those of making hats, plows and shoes. It will carry a substantial profit, but not a spectacular one as now and for many years to come. ”

“ A satisfied customer, the best advertisement, finds expression in the loyal recommendation an owner gives his own make of car; enthusiasm of maker, of salesman, of owner—it runs along the line, and if advertising is the gasoline which makes the car go, enthusiasm is the oil which keeps the bearings of the industry lubricated.
The year 1898 saw the first real attempts of manufacturers in the United States, either of gasoline, electric or steam cars, to make them in any quantity. ”

“ Then again a man may have two or three pleasure cars, but in his business he may have use for two or three hundred commercial cars.
The business world is just beginning to realize the value of the commercial car. Not only does it cost less by the ton or trip to haul in a motor car than with horses, but more can be accomplished in the same time. The teamster may require six hours to make a trip that the motor car driver can make in less than an hour. Business men, great and small, will soon learn this, and the commercial car industry will grow accordingly. ”

“ This would indicate that, while the population is gaining slowly and consistently, the production of automobiles has taken a decided jump, and a natural inference is that, even with so remarkable an industry as the motor group, it is beginning to prove food for speculation as to whether or not manufacturers, at the present increasing ratio of production and distribution, will bring a more or less complete saturation of the public, able to buy and support pleasure automobiles. ”

“ The medium priced car of today stands as the best exemplification of the approval of the Society of Automobile Engineers. This is an organization that has done so much for the manufacturer that most of the makers of cars are members. They point to the self-starter and the electric lighted car as the triumph of the Society of Automobile Engineers. And certainly from the original starter and the45 early lighting effects, enormous strides have been made in the industry. Fully equipped cars predominate now, where only a few years ago even tops were not provided with the car as sold on the floor. ”

“ The seventeen years in which the industry made its record, saw the rise and the fall of the steamer type of car, the wresting of an Old Man108 of the Sea, in the form of a discouraging patent holder from the shoulders of the manufacturers, the electric car largely depopularized and the gasoline car established in wellnigh universal favor. ”

“ But since the beginning of this century, when the automobile industry began growing, many of our people have, among many other things, built the great automobile industry into what it is, and made money. Not only this, but they will build it still greater, and make still more money.
Before we get through with this little analysis we will see that the automobile industry has not been more than half built thus far, and that the really big profits in it are yet to come, because so far much of the profits have been used in building the industry. ”

“ Immutable laws work in the automobile industry. The maker daily takes a course in the University of Production, because an army of selling factors constantly is attending to the absorption facilities of the country’s markets and he rarely permits himself the task of figuring on the “probable saturation point.” It is a wonderfully important thing to the maker that the national Organization gets official reports, guides the policies of standardization, holds an indefinable influence over the engineers30 of the industry, and sits as the congress of the Republic of Motor Car Production. ”

“ The extent to which economic methods of purchase of raw materials—getting the price down—economic standardization of manufacture, inventing short cuts as it were—affects production cost, is shown in the fact that the automobile industry ranks almost at the top in the manufactures of the United States in the per cent of value added by manufacture to the cost of material. ”

“ The volume of business is so large, and the interests concerned so wide, that the manufacturers have their own organization, called the Motor and Accessory Manufacturers. It includes one hundred and eighty makers, whose capitalization is three hundred millions, and whose investment is more than half a billion dollars.
There still remain to be discussed two phases of the automobile which have tremendous significance for the future of the industry—its commercial adaptability and its relation with the farmer and the farm. ”

“ The automobile industry illustrates graphically that when an enterprise develops to the point where it is well grounded and has reached a period of age and steady earning capacity, it is not new investors who may come in and gather the richest plums, but the old ones, those who helped to give it its start, who stood by it when the future was obscure, and the ultimate outcome not certain. ”

“ Many of our major industries, such as steel, glass, rubber, and textiles, rely on the auto industry to buy a significant percentage of their output. It is estimated that at least one in five jobs in the United States depends, directly or indirectly, on the automobile industry. ”

“ But that the electric car is a perfectly balanced piece of mechanism and the one type of the automobile with the least fits and starts, is conceded, and this superiority will doubtless enable the electric type to make up in the future in the motor truck field what it has lost to the gasoline type in the passenger field.
If the passenger automobile has not reached the length of its use and consumption, and it unquestionably has not, what shall be said of the freight automobile, the industry in which is yet in embryo? ”

“ A comprehensive survey of the automobile industry will include the industries that the automobile has created, as manufacturing tires and accessories, and not to forget the enlarged market for gasoline and oil. ”

“ The Automobile.—He does not, in progressive countries, depend on the muscle of the man, or on the sinews of animals. These are too weak and too slow for his needs. Look at the changes brought about by the automobile industry within the past ten years. What will the next century bring forth? ”

“ Co-operation contributed to the general adoption by the motor industry of the automatic machining of parts. What that meant in economic production was the saving of millions in cost of construction, which in turn got the automobile down to the level of the common people’s price. ”

“ When the full effect of the work of good roads advocates is felt in this country, and regular appropriations are to be available in a regularly scheduled manner in most of the states, the biggest thing the automobile industry ever had to help it will have taken up its task in earnest. ”

“ Busy are the cities where automobile manufacturing forms an important industry, and busy they are likely to continue for years to come, for as a commercial industry the business of making and selling automobiles has not yet even approached high water mark, in the opinion of those best qualified to judge. ”

“ The Reo Motor Car Company has paid over $50,000 on an investment of $1,000. These three are not by any means all the automobile companies which have contributed to make the automobile industry a signal example of the earning power of money, but they represent the leaders of the popular or quantity-production-through-low-price type. There are about 150 passenger automobile companies that are profitable in varying degrees, proportioned to their price, not to say anything of trucks and tractors, in the marketing of which fortunes are also being made. ”

“ The manufacture of body parts is obviously a tremendous industry, and while the body is a prime essential to the automobile, it was a part that existed in horse drawn vehicles, and, therefore, did not play the part that the pneumatic tire did in accelerating auto development. ”

“ The investor in the industry could scarcely be said to be using good judgment if he undertook to help to build a company to put out a car to compete with the Ford car, for illustration; that is, to put out a car at the same price and that he would expect the public to buy in preference to the Ford. ”

“ Seventeen years is not long for a commercial industry to take the place which the automobile business now occupies in a country as great as this. It is a short time in which to build up a business representing the figures of two billion on the mark of the American dollar. ”

“ The news coming out of the auto-industry this week reminds us of the hardship it faces. Hardship that goes far beyond individual auto companies to the countless suppliers, small businesses, and communities throughout our nation who depend on a vibrant American auto industry. ”

“ Names of automobile manufacturers who are prominent today were familiar names in the earlier stages of the industry, and more of the original automobile makers have survived than have fallen by the wayside.
107
Removing Obstacles to Automobile Production.
One objection the old philosopher has to the automobile is an objection that is strengthened by the fact that he does not own one. It is that the automobile contributes toward making the age one in which a really short time appears to be and is generally regarded as a long time. It destroys proportions as it annihilates space. ”

“ Until we reach that point the automobile industry will be in the formative period, in the creative state. It will be growing larger and larger, and will be earning more and more from152 year to year. But some of the earnings will have to be kept in the business to acquire additional equipment and as a greater working capital. But earnings used in this way will become additional assets back of automobile securities to enhance their values—to create accretive values. ”

“ The remarkable thing about the automobile industry is that, in comparison with its present magnitude, there has been but little original capital invested in it. Today the industry represents a large investment, to be sure, but the bulk of it is made up of profits on the original small investment. Companies started with small original capitals, made money, and used some of it to enlarge plants and increase outputs, until today we have the gigantic institutions that some of these companies are. ”

“ He is best known as an inventor in connection with the automobile industry. Among his inventions are a shaft drive and a beveled gear drive which are now universally used. He originated the idea of placing the operating lever on the steering post and made the first moderate priced automobile in France. He is now the engineer and manager of one of the biggest factories in the world. ”

“ I mean, obviously, as you heard administration officials say throughout the weekend, a strong, vibrant auto industry as the basis for our manufacturing in this country is extremely important. We have to ensure that the cars of tomorrow are built here by Americans, for Americans.
Obviously we are anxious to see the plans that will be offered by the auto companies. We've had teams of people from our economic team working on this issue throughout the transition, in the first few weeks of this administration. ”

“ No industry in our times has shown such phenomenal growth and in no country has its development been so marked or reached such proportions as in our own.
In the earliest stage of the industry, the automobile was accepted as a fad, and it has been stated that the American people took hold of the fad as an intoxicant, paying as high as from $6,000 to $12,000 for a car, and reveled in all the natural resultant vices of extravagance, snobbishness, excess and carelessness. ”