The New York herald., 1921-07-24
HE NEEDED $4,000, 900
New York Banker Offered
Loan Provided He Named
New Treasurer.
told HIM TO GET OUT
Speeded Up Sales, Effected
Economies, Collected Accounts
and Sold Liberty Bonds.

DETROIT, July 23.-Henry Ford has
told the story Of his recent quarrel
with Wall Street and how, alone, he
reorganized his gigantic automobile in
dustry. In the story he tells how a
New York banker came to him with
I, a proposal to make a loan, but on con-
dition that he name the new treasurer
of the Ford company. Mr.. Ford or
dered the banker out of his sight.
The New York banker had talked
for some little time with the manu-
facturer about the proposed loan. He
explained that there had been rumors
and counter rumors which led him to
believe Mr.. Ford would have good use
for about $60,000,00O atethat time. Mr..
I Ford did not deny the fact he needed
the money. But there was one stipu-
iation, as the representative of the
bankers explained. Would Mr.. Ford
tell him who the new treasurer Of his
company was to be?
That makes no difference to you,
does it?" asked the manufacturer.
The bankers representative ex-
planned that unless the interests back
Of him knew who the new treasurer
was to be 1t might make a great deal
of difference-even to refusal of the
loan.
Mr.. Ford said that closed the inter-
view. He handed the gentleman his
hat and showed him the door.
"And I told him to get out right
quick" said the manufacturer.
Obligations OF $5s,OOO,OOO.
Now all this time financial prob
lem had been developing" said Mr.. Ford.
Back in 1914 we had borrowed $40, ,000,-
600 on notes with which to buy out all
other interests. or this We had paid
$S7.000000, leaving $33, 900, ,00O, 900 fall
ing due April IS. Then, because Of
adjustments pending. we still had the
final instalment of the 1920 Federal in
come tax to pay. which. with the install
ment payable April is this year, made
$1S,000.000 due the Government Also
we intended to pay our men their usual
bonus on last years work. which would
amount to $7.000,000 more. So, all in
all. between January 1 and April IS
we had to meet obligations totalling
$5S.000, 900.
"I'll show you what we did," said Mr..
Ford, turning to the desk and pushing
across pencil and paper.
Put down cash on hand, $40. 1000, 900.
We wished as usual to pay bonus to
our men on last years work. This
would take approximately $1,000, 900,
which we wanted to pay as soon after
January l as clerks could make out the
checks. That was our only immediate
outlay-we had enough cash almost to
pay it three times over.
Then we turned our attention to liqui-
dation. When we closed down we had on
hand approximately $4,000 finished cars
At Highland Park we had been ship
ping out cars and parts to dealers and
branches as fast as they were finished
This plant was cleaned of materials
and every department closed down. But
we have thirty-five branches, scattered
over the country, at twenty-five of which
we both manufacture parts and assem-
BILE At these manufacturing of parts
stopped. but the assembling and finished
PARTS went on. adding to our finished
cars. That was why during January
there was a Ford car famine in Detroit.
and to fill local orders we were driving
cars here from Chicago and Columbus.
Ohio.
First Move to Push Sales.
Our first move was to sell some of
our cars on hand. In our contracts with
dealers they agree to take a certain
quota each year, each according to his
district. We shipped to each dealer
enough cars to take care Of approx
mately twenty-five days sales. During
Ia aFxr xsrA sol cA
which showed us what we could do when
we tried, and from then on sales steadily
mounted above production Assembling
went on at all the branches. and on
January 23 we reopened the Highland
Park plant and began building up pro-
duction there, but still sales kept ahead
Of production. Between January IL and
April ! we turned $24.700.000 worth of
stock into cash-put that down.
Then we looked over four foreign ac-
counts and found our agents at foreign
ports owed US $4,000. 900, which we cor
lected. We had also sold by-products
for which we had accounts receivable
of $3.700,000 more, which we got in
put down those two items. On top OF
that we sold s7,soO,0oo worth OF Liberty
bonds. II you'll total these you'll find
they come to $4,000, ,000--more than
enough to meet our impending obliga-
tions. But we did not stop there.
THE war had led us into many ex-
travagances OF administration and ac-
counting. We went through the plant,
offices and shops. and made economies
which I'll detail later, eliminating
everything non-productive. Then we
had acquired the Detroit, Toledo and
Ironton Railroad. We saw possibilities
OF reducing the vast amount of capital
which we had formerly kept tied up,
invested in goods in transit. We found
~rys to cut the time our goods were
in transit BY that one move we re-
leased s2s000.00o. took 1t from funds
invested in stock in transit and put II
TO other uses. Thus, when April / came
around we had sS7.300.000 to meet $751;
10000 In obligations. We paid them
all, weeks In advance"
Economics Established.