Henry Ford - A Great Innovator

Assembly-Line – A 'Paradigm Shift' in Automobile Manufacturing Contd...

The assembly line included two strips of metal plates – under the wheels of each side of the car – that extended through the length of the factory. Ford was able to reduce inventory to a great extent, resulting in significant savings for the company. The number of workmen required for assembling an automobile also fell. In January 1914, Ford designed an 'endless chain-driven' conveyor to move the chassis more quickly from one workstation to another. In April 1914, a 'man-high' line – with all the parts and belts at waist level – was introduced.

This made the job of assembling much easier. In 1914, 13,000 Ford employees manufactured 260,720 cars, as against the industry as a whole, which employed 66,350 workers to produce 286,770 cars.

By 1915, most of the manufacturing activities were conducted in-house. Ford moved towards vertical integration because he had mastered mass-production techniques long before the company's vendors had.

Vertical integration enabled Ford to cut costs considerably. By using the assembly line approach, the production of vehicles at Ford doubled every year during the years – 1913 to 1923.

Model T – An Astounding Success

The first Model T finally rolled out in October 1908. It was affectionately called 'Tin Lizzie,' slang for an obedient and reliable servant. The Model T was priced at $850 and was simple, light, flexible, powerful, and easy to drive. The car was targeted primarily at farmers and had higher than normal ground clearance. In the very first year, Ford set new industry records by manufacturing nearly 10,660 Model Ts. In the second year, 18,257 more Model Ts were produced. With a significant increase in the demand for Model Ts, Ford decided to set up a new factory. The facility at Highland Park was inaugurated in 1910.

It had four-storeys, encompassing a radius of 62 acres. Production in the factory was structured to move from top to bottom. Body panels were rolled out in the fourth floor and sent to the third floor, where tires were fitted on to the wheels and the bodies of cars were painted. Assembling took place on the second floor and was then lowered on to the ground floor, where the car was finally made ready for use.

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Case Details

Case Code : LDEN025
Themes: Corporate Social Responsibility, Entrepreneurship
Case Length : 13 Pages
Period : 1903
Organization : Ford Motor Corporation
Pub Date : 2003
Teaching Note : Not Available
Countries : USA
Industry : Automobile

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