#119 The Dodge Brothers

Summary Notes


John and Horace Dodge, small-town machinists, played a pivotal role in the early automotive industry, supplying essential parts to the burgeoning Ford Motor Company before launching their own successful car in 1914. Despite their wealth and influence, the Dodge brothers are often overlooked in automotive history. The book "The Dodge Brothers: The Men, the Motor Cars, and the Legacy" by Charlie Hyde provides a scholarly study of their contributions, from their Michigan upbringing and machinist expertise to their impact on manufacturing and marketing trends. Hyde highlights their civic contributions, inclusive hiring practices, and charitable work in Detroit, underscoring the enduring influence of the Dodge nameplate. Unfortunately, both brothers succumbed to illness in 1920, but their legacy continued through the eventual incorporation of their company into Chrysler Corporation.

Summary Notes

Early Success of the Dodge Brothers

  • John and Horace Dodge were small town machinists who became successful in the automobile industry.
  • Initially, they were key suppliers for the Ford Motor Company, providing nearly all car parts needed.
  • In 1914, they introduced their own car, which continued to carry their name after their deaths in 1920.
  • The Dodge company was later sold in 1925 to New York bankers and then to Walter Chrysler in 1928.
  • Despite their contributions, the Dodge brothers are often overlooked in automotive history.

"At the start of the Ford Motor Company in one oh three, the Dodge brothers supplied nearly every car part needed by the upandcoming auto giant."

This quote highlights the pivotal role the Dodge brothers played in the early success of the Ford Motor Company by being a primary supplier of car parts.

"After 15 years of operating a successful automotive supplier company, much to Ford's advantage, John and Horace Dodge a again changed the face of the automotive market in 1914 by introducing their own car."

The Dodge brothers not only supplied parts but also significantly impacted the market by releasing their own automobile in 1914, showcasing their entrepreneurial spirit.

Legacy of the Dodge Brothers

  • The Dodge brothers' influence on automotive manufacturing and marketing trends in the early 20th century is chronicled in the book.
  • They made civic contributions to Detroit, hired minorities and women, and made charitable contributions.
  • Their long-term influence on the automotive industry is acknowledged despite their early deaths.

"Hyde puts the Dodge brothers'lives and accomplishments in perspective by indicating their long term influence, which has continued long after their deaths."

Charlie Hyde's book aims to provide a comprehensive view of the Dodge brothers' lives and their enduring impact on the automotive industry.

Early Life and Career of the Dodge Brothers

  • The Dodge brothers grew up in a family of machinists and were known for their independence and mechanical abilities.
  • They started working hard at a young age, showing ambition and initiative.
  • John and Horace were entrepreneurs and investors but identified primarily as machinists.

"They were two fiercely independent but inseparable redheaded brothers."

This quote emphasizes the close bond between John and Horace Dodge and their shared passion for mechanics from an early age.

"They were the product of perfectly respectable lower middle class family that was supported by a skilled machinist."

The Dodge brothers came from a working-class background, which shaped their identity and work ethic throughout their lives.

Mechanical Talent and Resourcefulness

  • The Dodge brothers demonstrated mechanical genius early on, creating their own high wheel bicycle when they couldn't afford one.
  • This resourcefulness and mechanical skill led them to patent an improved bicycle bearing and start their own bicycle company before venturing into the automotive industry.

"John and Horace fabricated their own high wheel bicycle from scrap."

The quote showcases the brothers' ingenuity and ability to create functional products from limited resources.

The Dodge Brothers' Machinist Trade

  • John and Horace honed their machinist skills from 1886 to 1900, working up the ranks in various shops.
  • They manufactured replacement parts for typography machines and steam engines for boats before focusing on the automotive industry.

"John and Horace Dodge rather honed their skills as machinists from 1886 to 1900."

This quote illustrates the period in which the Dodge brothers developed their expertise in the machinist trade, setting the foundation for their future success.

Detroit as a Hub for Automotive Pioneers

  • Detroit's industry was ripe for automotive innovation, with foundries and machine shops providing the necessary resources.
  • The Dodge brothers' arrival in Detroit coincided with the city's burgeoning automotive scene, positioning them perfectly for success.

"Over the next 14 years, the Dodge brothers became accomplished machinists, experienced managers, and successful businessmen."

The quote summarizes the growth and development of the Dodge brothers' careers as they became integral figures in Detroit's automotive industry.

Interactions with Other Automotive Pioneers

  • The Dodge brothers' careers intersected with other industry giants, such as Henry Leland, founder of Cadillac and Lincoln.
  • Their personalities and aggressive nature contributed to their success, as they insisted on working together and pushed for opportunities.

"Horace no doubt gained valuable experience working for Henry Leland, who had brought to Detroit the high standards for accuracy already attained in the machine shops of Leland's native New England."

This quote highlights how working with Henry Leland influenced Horace Dodge's approach to precision and quality in automotive manufacturing.

The Dodge Brothers' Personality and Work Ethic

  • John was the more aggressive and hardworking brother, while Horace focused on engineering and craftsmanship.
  • Despite their wealth, they identified with the working class and remained close-knit, often socializing only with each other.

"John was the more aggressive and hardworking of the two brothers."

This quote distinguishes John Dodge's personality as the driving force behind their aggressive business approach.

The Dodge Brothers' Business Ventures

  • Before founding the Dodge Brothers Machinery Company, they patented an improved bicycle bearing and manufactured bicycles.
  • The Evans and Dodge bicycle was successful due in part to their innovative approach and avoiding direct competition with Canadian manufacturers.

"They teamed up with another guy, this guy named Fred Evans, and they manufactured the Evans and Dodge bicycle from 1896 until 1900."

The quote indicates the Dodge brothers' first entrepreneurial venture into bicycle manufacturing, which preceded their automotive endeavors.

Early Business Ventures of Dodge Brothers

  • Charlie Hyde discusses the early business ventures of the Dodge Brothers, focusing on their time as bicycle manufacturers.
  • The Dodge Brothers exhibited at the New York Cycle show in February 1897, as the only Canadian company.
  • They reportedly sold 50 bicycles in Philadelphia and more in New York City.
  • To promote their bicycles, they offered riding instruction, free for their customers and $2 for others.

"His company was the only canadian bicycle manufacturer to exhibit its wares at the New York Cycle show in February, 1897... He spent ten days at the show and reportedly sold 50 wheels to dealers in Philadelphia and additional ones in New York City."

The quote highlights the Dodge Brothers' strategic move to showcase their products at a major trade show, leading to significant sales in the U.S. market.

"To promote sales of their bicycle, they promoted the use of bicycles. Generally, they offered bicycle riding instruction."

This quote emphasizes the innovative marketing strategy of the Dodge Brothers, promoting not just their product but the activity of cycling to increase demand.

Transition to Automotive Industry

  • The Dodges sold their interest in bicycles due to a Canadian bicycle cartel consolidating the industry.
  • They used the proceeds to open a machine shop in Detroit, gaining valuable experience as machinists and managers.
  • The Dodge Brothers were in their 30s when they moved to Detroit, with years of prior experience in manufacturing.

"The Dodges sold their interest for $70,500 and established their own machine shop."

This quote signifies a pivotal moment where the Dodge Brothers shifted from bicycle manufacturing to opening a machine shop, laying the groundwork for their future automotive success.

"Their stint in Canada gave them much needed experience as machinists and as managers."

The quote explains that their time in Canada was crucial in developing the skills and managerial experience that would later contribute to their success in the automotive industry.

Founding of Dodge Brothers Company

  • The Dodge Brothers' first advertisement highlighted their diverse machining capabilities.
  • They initially took any job to sustain the business but eventually specialized in automotive work.
  • The company gained press attention for its modern and efficient operations.

"The very first ad of the Dodge Brothers company... builders of simple compound, triple and quadruple expansion, marine and stationary engines."

This quote from their first ad shows the breadth of services the Dodge Brothers offered, demonstrating their versatility and ambition in the early days of their company.

"The Detroit Free Press ran a lengthy feature article on Dodge machine shop in September 19 one and praised the operation enthusiastically."

The quote indicates how the Dodge Brothers effectively used media coverage to build their reputation, which was crucial for attracting clients like Ransom Olds and Henry Ford.

Ransom Olds and Early Automotive Industry

  • Ransom Olds was a key figure in the Michigan automobile industry.
  • Olds Motorworks provided contracts and training for future automotive leaders.
  • The Dodge Brothers secured their first automotive contract with Olds Motorworks.

"Ransom Olds was in many respects the founder of the Michigan automobile industry and the most important early automotive pioneer in the United States."

This quote underscores the significance of Ransom Olds in the automotive industry and his influence on the Dodge Brothers and other future automotive entrepreneurs.

"The Olds motorworks provided the first automotive contracts for... Dodge Brothers."

The quote reveals how the Dodge Brothers' initial automotive contracts with Olds Motorworks were a stepping stone to their future success in the automotive industry.

Work Ethic and Management Style of Dodge Brothers

  • The Dodge Brothers were known for their orderly and efficient management.
  • They worked long hours, prioritizing hard work and hands-on management.
  • Their dedication in the early years set the foundation for their later achievements.

"Perfect order prevails... The result was high quality, precision work that came as a result of using machine tools with skill and care."

This quote reflects the meticulous work environment and attention to detail that were hallmarks of the Dodge Brothers' management style and contributed to their reputation for quality.

"They were always present at the start and end of the workday... John Dodge estimated that during the first two years of the company, they spent a total of only six weekday evenings at home."

The quote illustrates the Dodge Brothers' commitment and the intensive labor they invested in their company, which played a crucial role in their success.

Strategic Decisions and Relationship with Ford

  • The Dodge Brothers specialized in automotive work and became a major supplier for Henry Ford.
  • They took calculated risks, including building a larger factory and investing in Ford Motor Company.
  • Their partnership with Ford led to substantial profits and dividends.

"The Dodge brothers made a second major decision, more risky than the first, but ultimately a brilliant one. They agreed in February 19, three to become the major supplier of components for Henry Ford before the current Ford Motor company even existed."

This quote indicates the strategic and risky decision to align with Henry Ford, which eventually paid off significantly for the Dodge Brothers.

"The Dodges became suppliers for the Detroit automobile industry."

The quote encapsulates the Dodge Brothers' smart business move to become suppliers during the automotive boom, akin to selling pickaxes during a gold rush, which secured their financial success.

Early Financial Struggles of Ford Motor Company

  • Ford initially struggled to make payments to the Dodge brothers for the components they supplied.
  • The Dodge brothers invested $60,000 before receiving any revenue from Ford.
  • The Ford Motor Company was at risk of bankruptcy due to its inability to pay the Dodge brothers.
  • The contract between Ford and the Dodge brothers allowed the latter to take ownership of machines and sell them if payments were not made.

"The Ford Motor Company struggled to make all of its early payments to the Dodges."

This quote highlights the financial difficulties faced by the Ford Motor Company in its early days, emphasizing the gravity of the situation where they could not afford a $5,000 payment.

Dodge Brothers' Involvement in Ford's Success

  • The Dodge brothers owned 10% of Ford Motor Company stock, which later became extremely valuable.
  • They delivered the first machines to Ford using horse-drawn hay racks, symbolizing the transition from old to new technology.
  • Their initial investment and risk were significant, but it eventually led to substantial returns.

"Dodge takes stock. They own 10% of the Ford Motor Company, which makes that eventual decision makes them tens of millions of dollars."

This quote indicates the strategic decision by the Dodge brothers to take stock in Ford Motor Company instead of immediate payment, which later resulted in massive financial gains.

The Turning Point of Capital Infusion

  • The Dodge brothers demanded payment from Ford, threatening to take ownership of machines per their contract.
  • A last-minute investment of $10,500 by an external investor saved Ford from bankruptcy and preserved the Dodge brothers' future in the automotive industry.

"This last minute infusion of capital kept the Ford Motor company afloat and kept the Dodges in the fold."

This quote captures the pivotal moment when an infusion of capital saved Ford Motor Company and, by extension, the Dodge brothers' significant investment and future business prospects.

Dodge Brothers' Strategic Business Decisions

  • In June 1903, the Dodge brothers agreed to write off overdue payments and extended credit to Ford in exchange for stock.
  • They later sued Henry Ford for not paying dividends, which led to a legal battle.

"With the Ford Motor Company habitually behind its payments, the Dodge agreed in June 19 three to write off overdue payments of $7,000 and extend Ford an additional 3000 credits."

This quote illustrates the Dodge brothers' strategic decision to forgo immediate payment in favor of gaining a stake in Ford Motor Company, which eventually led to a significant return on investment.

Growth and Adaptation of the Dodge Brothers

  • The Dodge brothers admitted to having a "foolish contract" with Ford initially but acknowledged their growth and learning from the experience.
  • They were involved in a near fistfight over quality issues with Ford's tester, showing their fiery nature but also their willingness to correct mistakes.

"John Dodge admitted we had a rather foolish contract or we would have compelled them, meaning the Ford Motor company, to pay over much more."

This quote reflects the hindsight acknowledgment by John Dodge of the naivety in their early business dealings with Ford but also highlights the substantial growth and learning that took place as a result.

Dodge Brothers' Manufacturing Capabilities

  • The Dodge brothers were responsible for manufacturing a significant portion of Ford cars.
  • They produced a vast array of components, showcasing the scale of their operation.

"The Dodge brothers manufactured 60% of the total value of the Ford cars produced between 19 three and 1914, including the legendary model t."

This quote emphasizes the crucial role the Dodge brothers played in the manufacturing of Ford cars, contributing significantly to the success of the Ford Motor Company.

Transition to Independence

  • The Dodge brothers' decision to manufacture their own car was influenced by their desire to improve upon Ford's design and Ford's refusal to accept changes.
  • They were motivated to become less dependent on Ford and took advice from their lawyer, Howard Bloomer, to start their own car manufacturing.

"The Dodge brothers decision to build their own car seemed like a logical step for them to take."

This quote summarizes the rationale behind the Dodge brothers' decision to transition from being Ford's supplier to becoming an independent car manufacturer.

Success and Expansion of Dodge Brothers

  • The Dodge brothers became wealthy through their contracts with Ford and dividends from their stock.
  • They built a new manufacturing plant to produce their own cars while still supplying Ford.

"By 1910, John and Horace Dodge were wealthy men."

This quote signifies the financial success of the Dodge brothers by 1910, setting the stage for their future expansion and independence in the automotive industry.

Legacy of the Dodge Brothers

  • The Dodge brothers' investment in Ford yielded a $32 million return.
  • They maintained a cordial relationship with Henry Ford after their legal battles.
  • They rapidly developed a new car and established a sales network, demonstrating their business acumen and efficiency.

"Their original investment of $10,000 in the Ford Motor Company in 19 three yielded a total return of $32 million."

This quote showcases the enormous financial return on the Dodge brothers' initial investment in Ford and highlights their significant impact on the automotive industry.

Ownership and Control in Business

  • The direct ownership and control by the actual owners are crucial for smooth business operations.
  • Owners who are enthusiastic and involved in the business facilitate better outcomes.
  • The Dodge brothers had full ownership and control over their company, unlike other contemporaries.
  • Direct control allows for quick decision-making and implementation of ideas.

"Things go smoothly when the actual owners are right in the factory and are most enthusiastic of all in having the best."

This quote emphasizes the importance of having owners directly involved and enthusiastic about their business, as it leads to smoother operations and better quality.

Decision-Making and Authority

  • Quick and autonomous decision-making can be highly effective.
  • Jeff Bezos demonstrated this with his prompt approval of a significant warehouse expansion for Amazon.
  • Having a singular authority figure can expedite processes and reduce bureaucracy.

"Jeff goes, you just did go do it."

This quote illustrates how decisive leadership and the ability to make quick decisions without the need for external approval can lead to rapid progress in business.

Organizational Structure Comparison

  • Comparing the Dodge Brothers' structure to that of Ford and GM reveals significant differences.
  • Dodge Brothers' management style was distinct and more straightforward due to their full ownership.
  • They avoided complexities by operating only one factory and not having to answer to banks, stockholders, or a board of directors.

"Unlike Ford, Durant and Sloan, the Dodges enjoyed full ownership of Dodge Brothers from the beginning, never borrowed from banks, and never had to consider stockholders or a board of directors in making business decisions."

This quote highlights the simplicity and efficiency of the Dodge Brothers' business operations, which was made possible by their complete ownership and independence from external financial influences.

Management Styles and Personalities

  • The Dodge brothers' management style was collaborative and non-autocratic.
  • John and Horace Dodge had a clear division of labor, with John handling business operations and Horace focusing on mechanical design and production.
  • Their personalities were reflected in their management style and their relationships with employees.

"By dividing up the tasks and responsibilities for those tasks, John and Horace Dodge stayed out of each other's way and thus avoided duplication of efforts and conflict."

This quote explains how the Dodge brothers efficiently managed their business by clearly dividing responsibilities, which prevented conflict and duplication of work.

Advertising and Brand Management

  • The Dodge brothers had a unique view on advertising, emphasizing cost-efficiency and practicality.
  • Their approach to advertising was to reflect the honesty and practical nature of their cars and themselves.
  • They believed in the value of their product and were confident in their pricing strategy.

"Horace and I go into the factory and sweat blood to save a 10th of a cent, and you fellows turn right around and throw away 10%."

This quote demonstrates the Dodge brothers' frugality and their critical perspective on advertising expenses, preferring to invest in the product rather than costly marketing.

Product and Pricing Strategy

  • The Dodge brothers took a different approach to pricing compared to Henry Ford.
  • They raised prices over time to reflect improvements in their cars, in contrast to Ford's strategy of lowering prices.
  • Their strategy was to target customers who would eventually seek an upgrade from the basic Model T.

"Just think of all those Ford owners who will one day want an automobile that's a bit of trash talking Dodge Brothers style."

This quote captures the competitive spirit of the Dodge brothers and their strategic positioning in the market, aiming at Ford customers seeking better-quality vehicles.

Contribution to the War Effort

  • The Dodge brothers were compelled to manufacture supplies for World War I.
  • They were recognized as skilled machinists capable of producing complex recoil mechanisms for artillery.
  • Their production efficiency exceeded that of the French manufacturers.

"The Dodge brothers were at their peak, were able to make five times that, 24 a day."

This quote showcases the Dodge brothers' manufacturing prowess and their significant contribution to the war effort by producing essential components more efficiently than the established French manufacturers.

Brotherhood and Partnership

  • The Dodge brothers made all important decisions together and maintained a close partnership.
  • They had separate offices but shared a unified vision for their company.
  • The brothers insisted on being addressed collectively rather than individually.

"The brothers insisted that mail directives to business be addressed to Dodge brothers or they would return it unopened."

This quote reflects the strong partnership and unity between the Dodge brothers, as they viewed themselves as a single entity in the context of their business.

Legacy and Impact

  • John and Horace Dodge's deaths were untimely, caused by the Spanish flu pandemic.
  • Their bond was so strong that Horace lost the will to live after John's death.
  • The Dodge brothers left a lasting legacy in the automotive industry and the Detroit community.

"The community could ill afford to lose John Dodge. He was a citizen who counted."

This quote from the Detroit Free Press underscores the significant impact John Dodge had on the community and the potential he had for future contributions had he lived longer.

Conclusion and Reflections

  • The Dodge brothers exemplified a successful partnership with complementary skills and a shared vision.
  • Their company thrived due to their honest and fair treatment of customers and employees.
  • The story of the Dodge brothers serves as a reminder of the importance of strong relationships and the unpredictability of life.

"It was a bond that had in it something of strange depth and purity and fineness, something that transcended the usual brother bond, for the brothers loved each other as friends."

This quote captures the profound and unique bond between the Dodge brothers, which was essential to their personal and professional success.

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