Wednesday, June 22, 2016

Ford's power, based on what he could achieve if vexed at other manufacturing industries, 1922

 Aug. 28 1922

Henry Ford decided that the price of coal was being manipulated by wall street investors, and that he would stop all manufacturing, and put 1 million men out of work until the price was returned to what he felt was honest. He found that $6.50 a ton was more than he would be able to abide, and would not buy any more parts from his 2200 suppliers until the price of coal was back to $4.50 a ton, and with all his employees, in all his factories, all across the USA... he alone had the power to change the way America was going to respond to his whim.

  "Declaring that Wall Street manipulators are responsible for the coal shortage, Henry Ford has ordered the closing of all his plants on Sept. 16. He states that he will not reopen them until he can obtain coal at what he considers a fair price. 

Telegraphic notices have been sent to about 2,000 sources of supply to cease shipment until further notice. A formal notice signed by Edsel Ford states: "On account of coal shortage we will be unable to operate our plants after Saturday, Sept. 16. No material will be received if shipped other than as detailed in the letter following."

It is estimated that the closing of the Ford plants will be responsible for the laying off of more than 1,000,000 workmen. There are approximately 50,000 employes at the Highland Park plant, 20,000 at the River Ronge and other Detroit plants, and 30,000 at Ford branches throughout the country. There are 1,600 plants scattered throughout the country whose principal business is the supplying of parts and materials for Ford cars. Henry Ford reiterated the statement this morning that he will not pay excessive prices for steel or coal.

 He stated that he could get coal if he were willing to pay over the market price and that he had been offered 60,000 tons at $6 a ton. He refuses to pay more than $4.50 a ton. Ford has sufficient coal on hand to operate until Sept. 16 and then to keep the factory ovens and boilers warm for an indefinite period.

Ford production has been running in excess of 5,000 cars a day. None of the other Detroit factories are affected as seriously as Ford. When asked when the plants would resume. Ford stated that he had no idea and that the situation seemed to him impossible.

Going into the closing period, the Ford company declared there were no stocks of new cars in its branches or dealer salesrooms throughout the country and that the closing was prompted solely by the coal and steel situations.

Retail sales in the summer of 1922 and up to the closing day have been about 5,000 a day, maxing out the capacity of production facilities.

Motor Age magazines, August and Sept of 1922

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