by Tim Falconer
THE PAST ACTUALLY BEGINS in Germany, where Karl Benz built a “motor carriage” with a gas-powered internal combustion engine and three wheels in 1885. Within six years, he started selling a fourwheel version. Brothers Charles and Frank Duryea may not actually have been the first automakers in the United States, but the bicycle builders from Springfield, Massachusetts, usually get the credit because they generated so much media attention when they tested a gas-powered car—with a one-cylinder, four-horsepower engine—in 1893. They’d sold thirteen of their “motor wagons” by 1896 when they formed the Duryea Motor Wagon Company to market their inexpensive limousines commercially. A year later, Ransom Olds started the Olds Motor Vehicle Company in Lansing, Michigan, but sold it in 1899, staying on as an executive with the business, which moved to Detroit and became the Olds Motor Works. By 1904, when the founder left, it was selling five thousand curved-dash Oldsmobiles a year. Even then, four years before Henry Ford introduced the Model T, almost half of the cars made in the country came from the Detroit area. In A Nation on Wheels: The Automobile Culture in America Since 1945, Mark S. Foster argues that was no accident. First, the region had resources: “Excellent hardwood forests had made the upper Midwest a natural location for production of wagons and carriages,” he writes, “and the same materials were used, initially, in automobile bodies.” Second, the area was home to a great number of ambitious entrepreneurs. Third, the presence of many manufacturers—including those of bicycles and carts—meant an abundance of skilled workers. In addition, the roads in the Midwest were even worse than those in the East and “gas-powered vehicles were far superior to electrics and steamers in less-than ideal conditions.”
The Model T ensured that Detroit would be Motor City. Henry Ford, who test-drove his first automobile prototype in 1896, saw the potential for an inexpensive car that millions of people, rather than a few thousand, could afford; he wasn’t the only businessman with that idea, he was just the most successful at reaching his goal. He created the Ford Motor Company in 1903, introduced the Model T in 1908 and started building the cars on a moving assembly line in 1913. Tin Lizzies weren’t stylish, but they were functional, rugged and reasonably reliable—and their height meant they could handle almost any bad road at a time when almost all roads were bad. Most of all, they were affordable, initially selling for $850 in 1908 when most others cars went for more than $2,000. As he increased production, Ford’s costs fell, and by the mid-1920s he was able to lower the price to as little as $300 (less than $3,600 in today’s dollars). Meanwhile, Ford’s decision to double the wages he paid to $5 a day, while cutting the workday by two hours, helped to create a middle class with enough money and leisure time that a car seemed like a necessity. More than fifteen million Model Ts rolled off the line before a decline in sales forced the company to stop production in 1927. While Ford stuck with his car longer than he should have, the success of the Model T led to an industry shakeout. From the early days of the industry, more than 1,500 companies had made cars, but by 1929, when the stock market crashed, only 15 remained in business.
For all his innovation in manufacturing, Ford didn’t have much interest in advancing the technology that went into his automobiles; instead, he was almost monomaniacal about creating a car for everyone and pushing the price down. So the design of the Model T stayed basically the same for nineteen years, and by the early 1920s, people joked that the Tin Lizzie was like a bathtub: everybody had one but nobody wanted to be seen in one. That’s why Ford needed his competitors as much as they needed him.
One of those competitors was General Motors. William Durant, who already controlled Buick, wanted to create an automobile-manufacturing conglomerate. In 1908, he formed General Motors in Flint, Michigan, and later that year bought the Olds Motor Works. The next year, GM purchased Cadillac and the Oakland Motor Car Company, which later became known as Pontiac. In 1911, after leaving GM, Durant helped to start Chevrolet, which became part of the conglomerate in 1917. Even as the Model T kept selling well, GM was quickly becoming a serious rival to Ford. It formed the General Motors Acceptance Corporation in 1919, to offer financing, and by the mid-1920s was coming up with new marketing ideas. “Top-level executives determined that many buyers wanted something more than basic, reliable transportation,” according to Foster. “Perhaps they could be sold on comfort, styling, and aesthetically pleasing choices of colors for both exteriors and interior fabrics.” The company also started making regular design changes to emphasize that last year’s model was, well, last year’s model. But GM wasn’t a technological innovator either: in fact, the company only wanted to lead in technology when that was the best way to make money for its shareholders.
Chrysler, the youngest of the Big Three, had a different approach. Essentially an engineering company, it played Apple to GM’s Microsoft—at least when it came to launching new technology. In 1925, a year after introducing a well-received eponymous car, Walter Chrysler, who had worked in the railroad industry, formed the automaker out of the wreckage of the Maxwell Motor Company. In 1928, he bought the Dodge Brothers Motor Vehicle Company and launched Plymouth as an inexpensive brand and DeSoto as a mid-market brand. Chrysler was convinced that the way to success was to build more advanced automobiles at a competitive price, and the company developed cars, notably the Plymouth, that were practical, comfortable and affordable.
In the 1940s, following the Depression and the Second World War, the economy boomed and Americans started lining up to buy cars. Even with expanded production capacity after switching from making automobiles to manufacturing for the war effort, the carmakers had trouble meeting the demand. But once they did, they needed to find a way to keep people buying cars. The result was a horsepower race: between 1940 and 1955, the horsepower of the average American automobile doubled and V8 engines grew from 40 percent of the market in 1950 to 80 percent in 1957. In addition, companies began to segment the market and got serious about making their previous models obsolete by introducing regular styling changes. That boosted demand—and the investment needed to keep up with the competition. Packard, which had built its first car in 1899 and had a rock-solid reputation for great luxury automobiles, merged with Studebaker in 1954. That same year, Nash, which had been one of the most consistently profitable of the small makers, merged with Hudson, which had been the country’s largest carmaker in 1929, to create American Motors. By the mid-1960s, the U.S. auto industry included just the Big Three plus American Motors and Kaiser Jeep. But then American Motors bought Kaiser Jeep in 1970 and Chrysler bought AMC in 1987.
Only three are left, and they’re struggling. The healthiest of the trio is probably GM, but that’s not saying much, and over the years its market share has withered from about 50 percent to 25 percent. The people who work there eagerly point out that most companies would drool over a quarter of the market in such a huge industry. That’s true if GM stays at that level; it’s not true if the company is like the guy going past the sixth floor after jumping out of a twelfth-floor window.
EACH OF THE BIG THREE automakers now has a museum of one kind or another in suburban Detroit. The oldest is the Henry Ford in Dearborn. Established in 1929 by the man himself, it features a broad range of exhibits, from technology to architecture to decorative arts, and is part of a complex that includes an IMAX theatre and a factory tour and bills itself as “America’s greatest history attraction.” The impressive car collection includes several presidential vehicles, including the 1902 horse-drawn Brougham carriage that Theodore Roosevelt rode in, the Lincoln “Bubble Top” that transported Dwight D. Eisenhower and the Lincoln Continental that John F. Kennedy was riding in when he was shot. The last in this line of limos is the one that served three Republicans and one Democrat: Richard Nixon, Gerald Ford, Jimmy Carter and Ronald Reagan. All subsequent presidential cars have been or will be destroyed in Secret Service experiments. I also saw the bus Rosa Parks was on in Montgomery, Alabama, when she refused to give up her seat to a white man; a yellow 1923 Stutz Bearcat
, usually considered America’s first sports car; and the Oscar Mayer Wienermobile. In addition, the museum has several exhibits that look at the social and cultural history of the car, including automobile advertising, food stands and drive-ins and the role of the car in movies. And I got a kick out of seeing a 1934 hand-written letter from outlaw Clyde Barrow (of Bonnie and Clyde fame) to Henry Ford that read: “While I still have got breath in my lungs I will tell you what a dandy car you make. I have drove Fords exclusively when I could get away with one. For sustained speed and freedom from trouble the Ford has got ever other car skinned and even if my business hasen’t been strickly legal it don’t hurt enything to tell you what a fine car you got in the V8.” A few months later, police gunned down the notorious pair in an ambush that left their stolen 1934 V8 Ford riddled with bullets.
Unlike the Henry Ford Museum, which displays cars from many manufacturers and is a popular, if expensive, tourist spot, the GM Heritage Center, in Sterling Heights, is dedicated to GM products and isn’t open to the public, though private events such as business meetings, training sessions and fundraising dinners take place there almost daily. More than 150 vehicles—including concept, rare and historic cars—were on display in the eighty-thousand-square-foot exhibit hall when I visited. Open since 2004, the centre boasts a collection of more than 800 automobiles, but only about 275 regularly go on display; the staff rotates about 25 in and out every week. Although everything was in immaculate shape, many of the exhibits hadn’t been saved off the line—I saw a 1940 Buick sedan that had more than eighty thousand miles on the odometer—because only relatively recently did the company realize that the first and last cars off the line would be more valuable saved than sold.
Finally, the smallest of the lot is the Walter P. Chrysler Museum in Auburn Hills. It opened in 1999 and stakes out middle ground between the other two, attracting about sixty thousand visitors a year. All polished red granite and black glass, the building sits behind a large sculpture called Motus Historia at the end of an impressive avenue-style driveway on a ten-acre site at the edge of the Chrysler campus. Green lawns surround the huge parking lots. After completion of the fifty-five-thousand-square-foot building, the company had a long “laundry list” of what it wanted to exhibit, but with no experience in the field, it lured Barry Dressel from his job at the national museum in the Turks and Caicos Islands. He was a good fit as manager: the son of a man who’d opened a driving school in Washington, D.C., in 1921, he started restoring a Model A Ford when he was fifteen, so he knew cars, and in the 1980s, he was the head of the Detroit Historical Museums, so he knew the area.
Dressel wore a brownish tweed jacket, brown pants, an olive shirt and a gold tie. A few months shy of his sixtieth birthday, he was a bit aloof and professorial, with a slightly patrician air about him. After we chatted in his small office for a while, he took me on a tour of the museum. We ended up in the basement, where the muscle cars are, and Dressel, who drives a Chrysler Pacifica and a Dodge Stratus, admitted that he wasn’t really a fan of these classics. In fact, I got the impression that he considered this part of his job slumming. But he enjoys giving lectures on the social impact of the car to groups of schoolchildren and other visitors to his museum. In an effort to make the place less of an “automobile ghetto” and attract a broader audience, he has plans to create several digital audiovisual tours using an iPod-like device that would allow visitors to select the information that most interests them, whether it be technical specifications or social history or car sounds or vintage ads or even—for those not particularly interested in automobiles—details about fashion and design in the 1930s. “Here in the Big Hubcap, some people call themselves car guys, but what they really are is hardware guys,” he said. “We discovered that the only way we can surprise people who know more about the cars than we do is to talk about the social context.”
The museum displays about sixty-five automobiles out of its collection of more than three hundred. Unlike the GM Heritage Center, which arranges most of its cars in rows in one large room, the Chrysler Museum creates a sense of movement with exhibits arranged at different angles and on a rotating tower with space for three vehicles in the atrium. We started at a display about Walter Chrysler and then moved on to his first prototype and came to a cream-coloured 1934 Airflow CU Sedan. “They kind of stumbled into it, but what they ended up doing was coming up with a new paradigm for how automobiles are built,” he explained. “The real significance was the fact that the cabin was moved forward and the engine was moved forward on the axles. It gave you a more roomy cabin and a closed, integrated trunk, an even weight distribution and a better ride. And that really makes it the prototype of a modern automobile.”
By the time we got to models from the 1980s, Dressel admitted, “Everybody walks by one of the most significant cars on the floor.” We were standing in front of the first Plymouth Voyager minivan—light brown with wood panelling—to roll off the line, in 1984. “Unquestionably a revolution,” my tour guide assured me. Beside it was a 1981 Plymouth Reliant, the first K-car off the line. The Reliant and the Dodge Aries featured front-wheel drive, and while they weren’t much to look at, they were inexpensive and economical—and, best of all, from the beleaguered company’s point of view, they sold well. “You can’t get anybody to look at the K-car, and yet K-cars dominated Chrysler in the 1980s, and as all the executives used to say, ‘We wouldn’t be standing here if it wasn’t for that car.’”
THE MINIVAN and the K-car were much-needed hits after the U.S. government bailed out the company with a $1.5 billion loan in 1979. During the 1990s, Chrysler built some successful cars— including the Jeep line—but it remained ripe for takeover when a wave of international consolidation crashed over the industry. During a decade or so of corporate coupling, Ford bought Aston Martin (which it later sold), Jaguar, Land Rover, Volvo and a controlling share of Mazda, while GM snapped up Saab, Daewoo and chunks of Suzuki and, for a time, Fiat. In 1998, Daimler-Benz, best known for its Mercedes line of luxury cars, joined forces with Chrysler to create DaimlerChrysler. Officially a merger, it soon became clear that the German company was the boss. While the relationship had its blissful moments—the Chrysler 300, for example—nine years later the American “partner” was up for sale again. The winning bidder was Cerberus Capital Management, a New York–based private equity firm.
Life hasn’t been too rosy for the other two domestic automakers either. While both had popular vehicles in their stables—especially their SUVs and pickups—they also had too many cars that just weren’t that appealing. GM, for example, sells over fifty different models. After suffering some huge losses, both companies announced plant closures, massive layoffs and a determination to focus on designing and building better, more exciting cars. In the United States, Toyota roared past Ford in 2007, knocking it out of second place on its home turf for the first time in seventy-six years. Around the world, Toyota sold 9.37 million cars last year, just 3,000 fewer than GM did.
Much is made of the fact that up to $1,500 of the cost of a new American car goes to pay for health care for current and retired employees of GM (or as some people call it, Generous Motors), Ford and Chrysler. Although it’s easy to slam the Big Three as reckless and stupid for getting stuck with these “legacy costs,” those benefits were the reason the companies were once held up as model employers. Besides, the domestic automakers’ problems can really be traced to two long-standing blind spots: good small cars and quality.
For decades, Americans didn’t fret about fuel economy or crave better suspension systems. After all, gas was cheap and most of the roads were straight and smooth (even before the government started building the interstates in the late 1950s, the country had a good road system). So the carmakers had little incentive to advance automobile technology except to make vehicles more powerful or to add flashy styling and gadgets. Meanwhile, European manufacturers were saying, “Can we make the car smaller, more fuel-efficient? Can we make it ride better with a more sophi
sticated suspension? Maybe we should try fuel injection and turbo charging.” Most of the advances in American cars after the oil crisis in the 1970s had appeared in European cars years earlier.
The more dangerous threat, though, would come from the other side of the Pacific Ocean. Toyota, which had begun making cars in the 1930s, first started exporting its Crown sedan to the United States in 1957. And within a few years, Datsun (now known as Nissan) and Honda were doing the same, though few paid much attention—until oil prices took off at the same time government demanded emission controls and both government and the insurance industry insisted on safety improvements. As the Big Three scrambled to produce smaller, safer and more fuelefficient cars, Japanese automakers pounced, taking the opportunity to establish a presence in the North American market. The 1980s were a dreary decade for Detroit, as the domestic companies produced a series of mostly uninspiring cars. But the high gas prices didn’t last and by the 1990s, Americans wanted bigger machines than ever.
GROWING UP in a large family—two parents, five kids and a wirehaired fox terrier—I spent a lot of time riding in station wagons. We had several, mostly Fords, over the years and I remember them fondly, but a lot of people my age don’t have the same warm and fuzzy memories. In 1984, when Chrysler, then under the leadership of Lee Iacocca, introduced the Plymouth Voyager and the Dodge Caravan, the timing couldn’t have been better. Baby boomers were starting to have a baby boom of their own and, being a generation that always wanted to be different from their parents, the last thing these yuppies wanted to do was pack their kids and their proliferating possessions into a dowdy and old-fashioned station wagon. It was not simply a question of style and impotent rebellion, though. The additional interior room and improved fuel efficiency that front-wheel-drive minivans offered over rear-wheel-drive station wagons meant these vehicles actually made a lot of sense.