The Business Philosophy of the Man Who Brought Us the Mustang–and the Edsel

The Atlantic interviewed Henry Ford's grandson in 1947, just as be began one of the most successful corporate rescues in history.
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Henry Ford II poses in front of a Mustang at the 1964 World's Fair in Flushing Meadows, NY.

In 1945, the Ford Motor Company named Henry Ford II, a.k.a. "Hank the Deuce," as its president. His grandfather, the first Henry Ford, had built the iconic brand into a giant, but by the end of World War II the company was in trouble. Financial collapse was a realistic enough possibility that some thought the young heir might cash out while he could. Instead, he took the helm and presided over a tremendous comeback, ultimately giving Ford customers iconic models like the Thunderbird, Falcon and Mustang–as well as duds like the Pinto and Edsel. 

Two years into his tenure, he sat down with The Atlantic for a lengthy interview at what we now know was the beginning of Ford Motor Company's second act. Insights into the post-World War II automobile industry abound. The firm employed 130,000 people at the time, and it is perhaps unsurprising that the scion of the company's founder declared his foremost goal was simply "to outsell Chevrolet."

What's been forgotten is Ford's biggest obstacle. "We can't get enough steel to manufacture anywhere near capacity," he said. "We are in a seller's market. Our facilities for making low-priced cars are not as large as Chevrolet's. Right now we can sell all we can make, and so can they. But some day supply is going to be greater than demand. It won't be a question then of how many you can make, but how many you can sell. Our goal is to outsell Chevrolet when that day comes."

What follows are excerpts from the interview.

Market Share

"Ford Motor Company total sales–of all types of passenger cars in all price classes–have dropped from about 45 to 50 percent of the total auto market in the mid-1920s to a low of 18 per cent today... If Ford has any 'rightful share' at all, I think it is considerably higher than 18 or 20 percent. I know we can do better than that."

The Businessman's Calling

"Of course, we are deeply interested in the difficult problems facing the United States and the world. But I do not pretend to be a philosopher, and I doubt whether we can help most by setting up a series of abstract goals. I have repeated many times that our organization has one primary peacetime job: to make more and better cars to sell for lower and better prices. If we do this job right, we will be making the kind of contribution to society a business like this is set up to make."

The Need for 4,000 Accountants

"One of the biggest problems was our almost complete lack of emphasis on finance accounting. No one knew how well or how poorly the steel mill or forge shop or any other part of the business was doing. There just weren't adequate figures. All we had was over-all financial statements appearing at not too frequent intervals, primarily for tax purposes... we were not providing anyone, from the job foreman up to this office, with the information needed to do his job effectively and well.

"Perhaps in the old days out here they didn't need all the people and organization we need these days to do our jobs. We now have more than 4000 persons employed in finance and accounting. Today we know whether the steel mill is operating at a profit or a loss and how much that is. we know how much is spent on labor, materials, and overhead."

Why Weighty Cars Won

Doc 1/Flickr

"As you probably know, we have been doing a substantial amount of research and experimentation, both regarding the kinds of cars people want and regarding possible radical changes in car design. At one time we did a lot of work on a radically different light car using new materials and weighing about a third less than present models. At least for the present, that idea is on the shelf, for the very good reason that our studies indicated that a light car would not give people what they really want–they want a car that will hug the road at high speeds; they want an extra-heavy frame and a car heavy enough to carry a lot of extra equipment. In fact, what they really want is a big car at a low price. At the present stage of development it just isn't in the cards to build these requirements into a light-weight automobile."

On Keeping Labor Happy

"Our cars are built by 107,000 workers on our hourly payrolls. These men are managed, not by a few hundred staff people they seldom see, but by a total management group of about 8700–from job foreman to this office. One of our biggest and certainly one of our most difficult jobs for the future is to make all 130,000 Ford men and women effective team players, to a far greater degree than they have been in the past.

"There are many phases to this job but the heart of our problem can be stated very simply: it is to get each man in our organization to treat the men he works with as he would like to be treated himself. Now let me tell you how far some of our foremen think we are from that objective. Hundreds of them answered a letter I wrote to all foremen this year, and we didn't feel very complimented about what some of them had to say. One man said that he and the other foremen in his building were constantly being dragged into the superintendent's office and given hell for everything that went wrong. Another talked about the time he was called down in front of a group of men 'in a way not fit for a dog to take.'

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Conor Friedersdorf is a staff writer at The Atlantic, where he focuses on politics and national affairs. He lives in Venice, California, and is the founding editor of The Best of Journalism, a newsletter devoted to exceptional nonfiction.

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