The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1927-10-25
FORD LOSES
24O MILLION
FOR new CAR
But S1oo,ooo,ooo Still Re-
mains in Cash at
Bank.
U. S. BUSINESS is HURT
Purchasing Power OF De-
troit Cut by 100000
Each Week.
U. S. BUSINESS is HURT

DETROIT, Oct. 25.-Henry Ford,
no built from low-priced automo-
biles the greatest fortune in the
worlds history, has set another
record this year-a record for losing
money.
Since the middle of May, when
Ford, deciding the time-honored
Model T" would have to give way
to an entirely new car, shut down
his plants and abruptly stopped pro-
duct:au, he has taken a paper loss
that Gsaches the stupendous total
of rnof~ than $240,000,000.
No individual but Ford could have
done it. No one without Ford's
enormous resources could have en-
tered that amount on his books for
the future on an even larger scale
than before.
Since Ford's shutdown occurred,
lost orders alone have given him a
book loss of $32,000,000 month.
Strapped His Machines
Added to this is the expense OF
completely making over his plants.
Almost all of his machinery had 10
be scrapped. Factories had to be
rearranged entirely. In addition,
there was a heavy overhead con-
nected with maintaining his idle
mines, his railroad, his steel plants,
his shipping line, his forests. Con-
servative estimates place his ex-
pense in these connections at
$50,000,o00.
His book loss on lost orders during
the shutdown period will approx
innate $192,Oo0,OoO. Of that sum,
probably $45,OOO,0OO would have
been clear profit.
These figures are almost too num-
erous to be grasped easily. Yet
Ford. in spite of them, has not had
to borrow a cent. For he began the
wear with a cold cash bank balance
of more than $350,000,000. Thus, in
spite of his heavy losses, he still has
a cash reserve of huge proportions.
Ford's losses have had a direct
effect on the rest of the country,
particularly on the middle west.
To begin with, his shutdown
stopped the payrolls in his factories.
It is estimated that this Topped
more than 100000 a week from
Detroit's purchasing power.
Steel Industry Hit
Il has been a slow summer for
the steel mills, and Ford is largely
responsible.
The railroads also felt Ford's
withdrawal keen1y. The rubber in
dustry was affected, though not so
sharply; plate glass manufactures
were hard hit, and the slumplng
coal industry was pushed down a
little bit deeper.
The automobile industry as a
whole was hurt, too. Paradoxical
as it sounds, Ford's withdrawal was
not an unmixed blessing for his
rivals. -
During the first eight months OF
this year the industry as a whole
sold 100000 fewer cars than in the
first eight months of 1925. It is
worth noting that whereas Ford's
production was 100000 cars below
his 1925 figure, his rivals were able
to increase their sales by only
100000.
Ford, oddly enough, is revealed in
all this change as man of great
sentiment.
For several years everyone else
in the automobile world knew that
the old f1ivver could not survive
the competition that Ford's rivals
were giving him.
Ford was the last to admit this.
He chung desperately to the old
Model T, even when his sales were
dropping alarmingly. Even last
winter, when it became obvious that
something would have to be done,
he wanted to keep the old model and
make improvements; and it was
only when he found that it would
cost him more to make the nee
essary changes than to bring out a
completely new model did he change
his attitude.
He is expected to be in full pro-
duction by the first of the year.
And industrial leaders, realizing the
tremendous extent of his influence
on the nations prosperity, predict
that his re-entry will bring return
of prosperity in every line.
For Ford is Ford-and when he
moves the whole nation feels it.