Manufacturing / Auto Industry
Early Manufacturing
Though Detroit is best known for its role as the capital of the automobile industry, manufacturing has long been a part of Detroit's heritage. Throughout history, Detroit has been a major manufacturer of everything from tobacco and paint to soap and shoes. Starting in the 1830s and continuing on for about 50 years, Detroit was the leading producer of stoves. In the 1850s Detroit was second in pharmaceutical production only to New York City (Woodford 2001, 81). The stage was clearly already set for this manufacturing-dominated city to welcome in the era of the automobile.
Henry Ford |
Henry Ford is arguably the most important player in all of Detroit's history. He is known for perfecting the mass producing assembly line and really launching the auto industry (though he didn't invent the car) with his Ford Model T, which is widely considered the first affordable vehicle. So why Detroit for this important industry? As previously mentioned, Detroit sits on natural resources important for auto manufacturing. Ford was also born nearby in Greenfield Township, Michigan, making Detroit an ideal spot for him to live and set up shop.
Ford was unique in his nondiscriminatory hiring practices - after World War I, Ford hired thousands of African American workers (Bates 2012, 2) and was known for paying wages high above the standard minimum. It would be almost two decades before other major automobile companies would start hiring African Americans for work other than janitorial positions (Ibid). However, Ford had many goals and visions for America, and part of being employed with Ford meant meeting certain standards: for housing and hygiene, but also cultural conformities such as learning English (Bates 2012, 26). Finding quality housing was particularly difficult for African Americans, who were relegated to very specific portions of the city, and who simply came in such massive waves that housing shortages emerged across the city. And as equal housing did open up over the course of 1920-1950, racial tensions worsened due to what whites saw as a takeover of their neighborhoods (Bates 2012, 92) . |
Capital of the Auto Industry (1900-10s)
Several factors created the right conditions for Detroit to be the capital of the auto industry. Because Detroit was a center for malleable iron manufacturing, it could supply much of the parts needed for automobiles locally. Also, lumber, which has been a profitable and labor intense industry was dwindling as other fuel sources and building materials became available. Thus, there was wealth from the successful industries, and a lot of excess labor that needed to be put to work (Woodford 2001, 98). This auto industry not only altered the spatial structure of Detroit by taking massive quantities of land for factory use and creating the demand for nearby housing, it also began Detroit’s obsession with roads, with Wayne County laying the first mile stretch of concrete highway in 1909.
Unionization of LaborDue to the amount of manufacturing labor making Detroit's economic wheels turn, unionizing labor had a huge impact on the city. Ford and his executive Harry Bennett was extremely anti-union (Bennett also being known for his terrible labor relations) and Ford swore he would never recognize a labor union (Woodford 2001, 146). However, labor unions won the day, and really took hold after the Great Depression when Roosevelt was elected and New Deal legislation presented (Woodford 2001, 144).
The benefits of the unionized labor are numerous as far as health, safety, and living wages are concerned. However, it is likely that the increased wages and improved standards across the entire industry combined with labor shortages during WWII helped push companies to automate production. Eventually labor needs would decline, especially as the price of labor rose, and with more recently developed practices such as "just in time" manufacturing. |
Decline of the Auto IndustryMost people know of the decline of the auto industry crash and bailout during 2008-2010. However, the auto industry had problems long before that. While there are clear points of interest in the decline, such as the oil embargo of 1973 and the 1979 oil crisis, there has been a constant decline in the auto industry since the 1950s. Thanks to foreign competition, rising costs of production, and the overall shift of the United States economy to a service economy, the auto industry has been on a slow fall for years.
In the 1960s, the Big 3 (GM, Ford, and Chrysler) controlled roughly 90% of US vehicle sales. Today, that number is closer to 45%. In the last couple years since the bailout, there has been a "buy American" push by marketers and consumers to support American businesses and American made cars, and the Big 3 market share has ticked slightly upward because of this. |