In the 1900-08 period, the automobile outgrew its horseless-carriage era, established the superiority of the gasoline engine over electricity and steam, and swung from the very light buggy-type automobile, with a one-cylinder or two-cylinder engine, to the four-cylinder and six-cylinder touring car, which sometimes approached the proportions of a land-going battleship. There was still no satisfactory self-starter, and except for a few very expensive limousines there was virtually no market for the closed car. The motorist was still a hardy soul who was apparently superior to wind and weather, although it was also true that the automobile was not popular for winter driving and many cars were laid away during the winter months. Hence the seasonal nature of the auto business, with the bulk of the output concentrated in the early months of the year. The horse and buggy had been pretty well displaced as a medium of personal transportation, although the horse continued to do most of the heavy hauling, very few motor trucks being produced before 1910.
The automobile clubs still flourished and automobile ownership remained a badge of financial and social distinction, although cars no longer circulated chiefly within the confines of the Four Hundred. But there was only about 1 car to every 450 persons, or, more significantly about 1 car to every 100 families. A city of 50,000 inhabitants was figured to have little more than 100 automobiles, so the car-owner remained a member of a highly select minority.
On the other hand, everyone was now automobile-conscious and the horse no longer had any friends. Popular interest centered upon motorcar performance; most of the automobile news of the period dealt with races, cross-country endurance tests, and hill-climbing. All the hills in the country were climbed at least once, and the more important summits were “conquered” so frequently that they must have felt like hanging out a white flag whenever an automobile approached. Inasmuch as the races were nearly always won by foreign automobiles – particularly the Mercedes – and since the average motorist must have found it very rarely necessary to scale Pikes Peak, the emphasis upon records of one sort or another now seems artificial. But it was necessary for the automobile manufacturer to keep proving that his cars could go “a mile a minute” because the period in which they had not been too certain to go a mile an hour was still well remembered.(Ford, who built racing cars to advertise his standard product, drove a Ford racer at better than a mile a minute in 1899. In 1905 a 120 horsepower, eight-cylinder Mercedes made a mile in 34 1/5 seconds.) Since 1900, the automobile engineer had made tremendous improvements in the speed, the power, and the reliability of the gasoline engine; the endless succession of new speed and endurance records gave the public a dramatic demonstration of new standards of performance, and these were still subject to revision upward.
Automobile output was limited not only by the capacity of the industry but also by the large and rapid increase in the prices of automobiles. Declines in the output of individual manufacturers (declines which have been mentioned in the discussion of the Oldsmobile, the Cadillac, and the Ford companies) resulted partly from the fact that the total automobile output was being divided among an increasing number of manufacturers, but the high cost of automobiles was also a limiting factor in sales. At the beginning of the century, the average automobile price was between $1,000 and $1,200. In 1908, the average ranged from $2,800 to $3,000. The car of 1908 therefore cost almost three times as much as the car of 1900. The writer’s estimate of the retail value of the 1900 automobile output is about $4,000,000. The retail value of the 1908 car was in the neighborhood of $200,000,000 – and $200,000,000 was a sizable investment for the 1908 public to make in a commodity that was not yet regarded as a necessity of life.
The following table shows the annual automobile output (including Canada) for the first eight years of the twentieth century:
1900 – 4,192
1901 – 7,000
1902 – 9,000
1903 – 11,235
1904 – 22,130
1905 – 24,250
1906 – 33,200
1907 – 43,000
1908 – 63,500
On the reckless assumption that all the cars made since the beginning of 1903 were still in operation at the end of 1908, there were a few less than 200,000 automobiles in the United States at the close of the 1908 season. Since the population of the United States had increased from 76,000,000 in 1900 to 89,000,000 in 1908, nature was providing a good many more potential car-owners than the auto manufacturer was providing cars for them. But before the automobile could be sold to more than a microscopic portion of its potential customers, two developments were necessary. In the first place, there had to be an increase in the purchasing power of the people. In the second place, there had to be a reduction in the price of the cars.
