Econ Focus

When Car Manufacturing was a Small Business

Hundreds of firms were engaged in manufacturing automobiles in the early years of the industry. A few were well-established companies with considerable financial resources that ventured into automobile manufacturing as a sideline, including the Pope Manufacturing Co. of Hartford, Conn., the nation's largest manufacturer of bicycles, and the Studebaker Brothers of South Bend, Ind., the largest builder of horsedrawn carriages in the world. But most early manufacturers were small businesses operating on a shoestring. You didn't need much capital to get into the business. More important were mechanical ability, marketing skills, and the willingness to take a chance on a risky enterprise.

These small enterprises were scattered throughout the country in the period from 1900 through 1930. Many of them produced fewer than 10 cars before going out of business and have long been forgotten. Even the most successful of the small companies had largely disappeared by 1930, unable to compete with companies like General Motors and Ford, whose large volume of output enabled them to realize tremendous economies of scale in production.

The Kline Motor Car Co. was one such small company. It produced hundreds of Kline Kars in Richmond, Va., from 1913 to 1923. Typical of a small producer, Kline marketed its car as being of higher quality than mass-produced vehicles. Kline Kars were notable for using steel parts rather than iron to reduce weight and for having electric starters. At a price that could run as high as $3,500, the Kline Kar was clearly for the most discriminating shopper.

In Rock Hill, S.C., John Gary Anderson operated a carriage shop, and from 1918 to 1926 produced the Anderson touring car. Like Kline's product, the Anderson touring car was exceptionally well made — it had a six-cylinder engine and could travel up to 50 miles per hour. And, unlike Ford's Model Ts, which were overwhelmingly black, the Anderson car came in a variety of colors. Roughly 6,500 Anderson touring cars were built before the company shut its doors.

In Hagerstown, Md., Matthias Möller, a local pipe organ manufacturer, joined with Robert Crawford in 1905 to form the Crawford Automobile Co. About 1,500 Crawford touring cars were produced from 1905 to 1924. In 1922, Mšller introduced a new car, the Dagmar, which came in a variety of body styles, including a four-passenger version called the Victoria Speedster. While less than a thousand Dagmars were manufactured before production ceased in 1927, it was comparable to the famous Stutz Bearcat and popular with those Americans living the good life of the Roaring '20s.