This is an excerpt from my forthcoming book, The Origins of Efficiency, out September 23rd.
Ford’s status as a large-volume car producer began with the predecessor to the Model T: the Model N, a four-cylinder, two-seater car initially priced at $500. At the time, the average car in the US cost more than $2,000, and it seemed nearly unimaginable that a car with the capabilities of the Model N could cost so little. In 1906, the year the Model N was introduced, Ford sold 8,500 of them, making the automaker bigger than the next two biggest car producers, Cadillac and Rambler, combined.
To produce such a huge volume of cars, Ford began to use many of the production methods it would develop more fully with the Model T. Many of the Model N’s parts were made of vanadium steel, a strong, lightweight, durable steel alloy. Vanadium steel allowed for a lighter car (the Model N weighed only 1,050 pounds), and was “machined readily.” This was important because Ford also made increasing use of advanced machine tools that allowed it to produce highly accurate interchangeable parts. In 1906, Ford advertised that it was “making 40,000 cylinders, 10,000 engines, 40,000 wheels, 20,000 axles, 10,000 bodies, 10,000 of every part that goes into the car…all exactly alike.” Only by producing interchangeable parts, Ford determined, could the company achieve high production volumes and low prices. Furthermore, Ford’s machine tools were arranged in order of assembly operations rather than by type, allowing parts to move from machine to machine with minimal handling and travel distance. It also made extensive use of production aids such as jigs, fixtures, and templates. These “farmer tools”—so called because they supposedly made it possible for unskilled farmers to do machining work—greatly simplified Ford’s machining operations.
The Model N was so popular that demand exceeded capacity, which allowed Ford to plan production far in advance. This meant Ford could purchase parts and materials in large quantities at better prices and schedule regular deliveries, ensuring a steady, reliable delivery of material, which allowed it to maintain just a 10-day supply of parts on hand.
But even as the Model N became Ford’s bestseller, the company was designing the car that would supersede it: the Model T. In addition to improving upon many aspects of the Model N— the Model T would be a five-seater, include a new transmission that made it easier to shift gears, and have a three-point suspension that made it better able to navigate America’s low-quality roads—the Model T’s design also involved significant process improvements. For one, it pushed the machining precision of the Model N even further. In his history of Ford, Douglas Brinkley notes that “in an industry previously unfettered by anything like exacting measurements, the typical tolerance on the Model T was 1/64th of an inch.” Indeed, outside the auto industry, some types of manufacturing were done without even the aid of dimensioned drawings. This precision machining was “the rock upon which mass production of the Model T was based.” Not only did a high level of precision facilitate manufacturing, it also made for a better product—one that was much more reliable than any other car on the market. Because parts were interchangeable, repairs were simpler. And the precision of the machining meant that unlike most other automakers, Ford didn’t need to test the engine before it was attached to the chassis, since “if parts were made correctly and put together correctly, the end product would be correct.” The Model T would ultimately cost around $100 a year to maintain, at a time when the maintenance of other cars cost $1,500 per year.
At the time, most four-cylinder engines were cast either as four separate cylinders or two groups of two cylinders and then attached together, which required extra time and material. The Model T’s engine block, on the other hand, was cast as a single piece. Several components—the rear axle housing, transmission housing, and crankcase—were not made of the more customary cast steel but rather stamped steel, a then-novel technology for automobiles that was cheaper than casting. Like any new technology, these production methods required time and effort to implement—it took 11 months of development to figure out how to produce the drawn steel crankcase—but the manufacturing cost savings were worth the effort. Over time, more and more Model T parts would be made from pressed steel, though the transmission housing itself was later changed to cast aluminum.
The Model T was not the cheapest car on the road when it was introduced—at $850, it cost several hundred dollars more than the Model N. But even when Ford later briefly raised the price to over $900, no other car offered so many features for the same price. Between October 1908, when the new model was announced, and September of the following year, Ford sold 10,607 Model Ts. By March, Ford had temporarily stopped allowing orders because it had filled its factory capacity until August.
As production for the Model T began, Ford was already busy reworking and improving the production system. Originally, cars were transported by rail to Ford dealerships all over the country. But, realizing this wasted train space, Ford soon began to create local assembly plants. Model T parts would be shipped to these plants and then assembled into cars, dramatically lowering shipping costs. In his history of the company, Allan Nevins notes that “by shipping parts in a knocked-down state, [Ford] was able to load the components of twenty-six Model Ts into an ordinary freight car instead of the three or four complete cars that could otherwise be sent.” And while the Model T had originally come in several different colors, in 1912 Ford announced that the Model T would now come in a single color: black.
The first Model Ts were assembled in Ford’s Piquette Avenue plant in Detroit, which was built in 1904. But in 1910 it moved production to the new, larger Highland Park factory, also in Michigan, which was considered to be the best designed factory in the world. At a time when electricity was still somewhat uncommon in manufacturing, electric motors drove mechanical belting and overhead cranes were used to move material. At the Piquette Avenue plant, material came in on the bottom floor and final assembly was done on the top floor. But at Highland Park, material came in on the top floor and gradually moved down to assembly on the ground floor. To facilitate the movement of material, thousands of holes were cut in the floor, which allowed parts to move down through the factory through chutes, conveyors, and tubes.
At Piquette Avenue, machine tool use had been extensive, but the machinery was largely general-purpose. With the decision to focus on a single model and the subsequent enormous increase in production volume, Ford began to buy or create dozens of special-purpose machine tools designed specifically for the Model T, such as a machine for automatically painting wheels and another for drilling holes in a cylinder block. As with the farmer tools first introduced on the Model N, these special-purpose tools not only produced parts more cheaply but could also be operated by less-skilled machinists, reducing labor costs.
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