How to assemble an auto empire: Be a builder, a buyer and a juggler

Billy Durant was a builder and a buyer. He was an unparalleled entrepreneur, but he was not much of a businessman.

He built Durant-Dort Carriage Co. into the world's largest producer of such conveyances. He was a millionaire before he was 40, and the fledgling automobile industry became his next world to conquer.

From the time he took over Buick in 1904 to the time he was forced out in 1920, Durant assembled what was and is General Motors, the world's largest purveyor of horseless carriages. Today, we call them automobiles.

His vision: a multifaceted corporation that could produce a vehicle for every buyer in almost every price range.

GM bought Oldsmobile in 1908, then Oakland (which became Pontiac) in 1909. Also in 1909, Durant spent $4.75 million to acquire Cadillac. That same year he added companies that would become the basis of GM Truck Co., now GMC.

Ransom E. Olds started his motor car company in 1897. But he feuded with his backers and left to establish Reo Motor Car Co., which took his initials as its name. The owners of Olds sold it to Durant at the end of 1908 for $17,279 and about $3 million in stock in the new GM.

Oakland was formed in 1907 by buggy maker Edward Murphy and Alanson Brush, who had been chief engineer at Cadillac. Brush soon left, and Murphy sold the company to Durant.

Oakland became an innovator within GM, the first with an all-steel body (1912) and the first with colorful lacquer paint (1924). Oakland became Pontiac in 1932.

Auto historian Beverly Rae Kimes notes that Pontiac was unique in GM history: It was the only offspring to kill its parent. From 1926 to 1932, Oakland and Pontiac co-existed. But as Kimes noted in Standard Catalog of American Cars 1805-1942, "After Pontiac's smashing debut, the demise of Oakland became only a matter of time."

Cadillac — a coup

Cadillac began in 1902 when Ransom Olds decided not to buy the new engine developed by Henry Leland — who instead took the engine to Henry Ford Co., the remains of Henry Ford's first attempt as an auto manufacturer. Ford lost control of that company to his partners, who took on Leland and his engine and created Cadillac.

Needless to say, Henry Leland was not one of Henry Ford's favorite people. Ford bought Leland's struggling Lincoln Motor Co. in 1922 — and Leland and his son, Wilfred, lasted only a few months at Ford Motor Co.

Cadillac was the first automaker to succeed in standardizing parts on a major scale. Early in 1908, eight Cadillacs were shipped to England. After being driven, three of them were torn down. More than 700 parts from each car were mixed with nearly 90 off-the-shelf components, and the cars were reassembled and driven 500 miles at top speed, earning Cadillac the Dewar Trophy for significant advances in manufacturing.

Durant took over Cadillac before the brand's next Dewar Trophy — for the electric self-starter, in 1912. It was developed by Charles Kettering during his pre-GM days at Delco.

To this day, some auto historians consider the self-starter to be one of the two most important automotive technological advances of the 20th century. The other: the automatic transmission.

In 1909, Durant added Reliance Truck (started in 1902 in Owosso, Mich.) and Rapid Motor (founded in Detroit in 1902 by brothers Morris and Max Grabowsky, who in 1906 would build an assembly plant, later called Pontiac West and used by GM until 1994).

Reliance and Rapid were combined into Rapid Truck, which became GM Truck Co. in 1911 and concentrated on building heavy-duty trucks and buses. Today, as GMC Truck, it is part of the Buick-Pontiac-GMC division.

Buying the biggies

Durant wasn't buying pigs in pokes when he built his GM empire. He took on established car names — if any car name except Ford could be called "established" a century ago.

For example, although Buick was foundering when Durant came along in 1904, it sold 18,577 cars in 1909. Buick led the infant industry and outsold Ford's Model T by 4,737 units. Oldsmobile moved a very respectable 1,146 cars in 1908 and zoomed past 33,000 in 1919.

Cadillac was a big shooter when Durant acquired it in 1909, with 7,919 sales. It was third in the industry, behind Buick and Ford.

Oakland was the runt of the litter: only 457 sales in 1908, the year it joined GM.

Durant also bought a long list of parts suppliers — including, in 1909, Champion Ignition Co., which later became AC Spark Plug Co.

Durant lost GM in 1910, then regained control in 1916. The company that he reacquired that year included Buick, Cadillac, Oakland, Oldsmobile and GM Truck. He added Chevrolet to the fold in 1918.

By 1920 he was out again — for good.

You can reach Larry Edsall at autonews@crain.com.