John North Willys, Automotive Pioneer
John North Willys (correctly pronounced Will-is) was born in a small central-western New York village called Canandaigua on October 25, 1873. His father was a tile maker of some repute, and also made a decent income as a master brick layer in construction. His mother kept the house.
The name Canandaigua was derived from the five-nation council of native Americans that comprised the Haudenosaunee (the people of the Long Houses) tribes of the Seneca, Onondaga, Cayuga, Oneida, and Mohawks. At first, Americans translated Canandaigua as "the place to live." Later on, it was discovered that it actually meant "the place to meet." It sits at the exact North end of Canandaigua Lake, and is the Western-most of the seven larger lakes in the Finger Lakes. It also is the start of what the natives maintained as the "plains" region, which was fairly flat, strewn with creeks, good vegetation, and had herds of bison roaming freely. In practice, it was a republic, with members elected to represent groups within the council from all 5 tribes. It also had a system of laws, and a supreme council to decide issues. They maintained control and peace with such a system for over 250 years. Their mutual protection kept rivals, war, famine, and dictatorial control far at bay.
John Willys was an enterprising individual from the beginning. He bought and sold items profitably even as a child. He saved nearly every penny he earned, unless, items were needed in the household, or his personal needs had to be attended to, which would include his own shoes and clothes.
1873 was an economically tough year in the United States. The collapse of the strung-out Jay Cooke railroad empire started a cascade of failures in banks, railroads, and other business that resulted in a economic depression that lasted through 1879. Of the 490 major banks in the country, 89 failed outright. Panic ensued, causing investors to dump stock. With no money to back it, the New York Stock Market collapsed, closing for ten straight days until the run subsided.
After the civil war, there was a period of mourning for President Lincoln. This was followed by the scandalous Johnson Administration which put the country into turmoil, resulting in his trail by impeachment. Ulysses S. Grant was elected as President in 1868, after a public quarrel with President Johnson. Grant aligned himself with some radical Republicans, going hard against President Johnson, and was was elevated to hero status by the common man. To control inflation, Grant sought to decrease the supply of coins, which pressed harder on the already strained money supply. Even when his policies exacerbated the recession, he did not relent.
The costs of goods went down slightly due to very heavy competiton in rail traffic. When investment in new railroads dried up, those existing had to make an income or go bust. They cut costs to the bone.
In 1873, bread, if bought from the local bakery, might run 8¢ loaf. That made from flour that cost about $1.25 a barrel. Coffee, now a staple of American diets, cost about 12¢ a pound. Sugar was 7¢ a pound, eggs about 15¢ a dozen, while cheese fetched about 5¢ a pound locally. Beef cost 25¢ a pound, pork about 22¢, and chicken or turkey was either raised at home, shot when needed, or cost about 11¢ at the local butcher, if you had one. Whale oil, which had run out, creating a near crisis for home lighting, had been replaced by a new substance called kerosene. You could buy it by the gallon from your friendly neighborhood Eastern Seaboard Standard Oil rep at 15¢. Gasoline, a byproduct from "cracking" crude in making kerosene, was discarded, having no purpose.
Earning money was not easy. Unemployment soured to 14%; jobs were hard to find. A lawyer might find enough clients to earn $300 a month, or take supplies for their households in barter. A coal miner would earn about 35¢ an hour over a 60 hour week, for $20 or perhaps $25 a week. A laborer might find something to do for about 25¢ an hour over a 50 hour week for $12.50. A river boat captain such as Mark Twain earned between $150 and $300 a week for their skills in navigation on the rivers. A law man, such as Wyatt Earp, was paid one of the highest wages in the country at $250 a month. A deputy earned $100. You could buy a case of beer, like Budweiser (it was around then) for $2 a case of 24 bottles. Whiskey ran about $2 a gallon for home brew, and perhaps $3 for some stuff with a label.
Transportation was accomplished by a $80 dollar draft horse. He could pull a $65 wagon or an $85 carriage. He would live in a small barn that might have cost $150 to erect. A two room house might cost between $300 or $400 @ about $1. 10 a square foot. This would be built on land that ran between $5 and $8 an acre.
This is the era in which John Willys grew up in. At age 15, in 1888, he approached his parents about becoming a partner with a friend in a laundry in a nearby town. He was so convincing that his parents agreed. He moved into an apartment which came along with the laundry operation in Seneca Falls NY. He and his partner successfully operated the laundry for a year, doing business even on Sundays. At the end of a year, they sold the entire operation and made a profit of a thousand dollars, which was split between the two partners. His parents expected him to further his education with that money. Several colleges were close by, one of the best being at Elmira. John set out to become a lawyer. He was able to pursue a couple of years of college education before his father died; at 18, John had to return home to support his mother and other siblings.
Not one to work for someone else, Willys saw an opportunity in bicycles. A craze for them was sweeping the country. He rented a small space in Canandaigua for his sales room; he adapted quickly to methods that earned him profits while keeping more of his own money. Within a very short time, he expanded into repairs of bicycles, which included selling parts and dress up kits. Within a few months, he moved his operation to Main Street. As an agent for several different bicycle manufacturers, he was well informed when some of them invited him along in their ventures into automobiles. In 1896, he became an agent for a company out of Boston that sold rubber hoses; they were braided, which greatly increased their tensile strength and longevity. It would later became the basis for automobile "balloon" tires. It is not known if Willys pursued that aspect of the company or not. Presumably, given his penchant to find winners, he had some interest in rubber balloon tires.
In 1897, he married a local girl named Isabel Van Wie. They had one child, a daughter named Virginia.
In 1898, Willys purchased a bankrupt sporting goods operation in Elmira, in a great location. He expanded his bicycle business there, and it boomed, often selling the entire year's production of cycles from a couple of different factories.
In 1899, while visiting a business in Cleveland Ohio, he saw his first automobile going down a city street. He was fascinated. Willys noted the total immense interest of every person that saw the car going by. He didn't get bitten by the "bug" that often accompanies seeing a new car. Upon consideration of what he observed, Willys made a conscious deliberate decision that automobiles would be the next "big" thing in the country, quickly replacing bicycles, horses, and railroads.
By 1900, at age 27, he had greatly expanded, with a sales staff selling bicycles all over the eastern United States, to the tune of over $500,000 a year. He purchased a Pierce automobile (made by fellow bicycle maker George Pierce) from the factory in Buffalo for $900 and used it in demos as an agent to sell the Pierce cars. He sold nothing in 1900. In 1901 he sold two cars.
Anyone else may have given up, but he took on a Rambler franchise in 1902; between the two makes, he sold 8 cars (and twenty in 1903). People at that time were slowly overcoming their initial resistance, skepticism, and lack of trust in long term financing to satisfy their deep desires to own, or be the first to own, an automobile. The Rambler was made by Thomas Jeffrey, another bicycle man, located in Chicago; Willys had sold many Rambler bicycles. Jeffrey had started a car factory in 1900 in Kenosha; the Rambler car of 1902 had the engine under the seat, but was well built, and reasonably priced.
Jeffrey was an innovator, the first to move the engine to the front of the car, and to make the steering tiller into a steering wheel, easing driving into a near unconscious effort. By 1904, Willys could not get enough of Jeffrey's cars; and his other supplier, Pierce, had decided to move his cars upscale, coming out with a Pierce-Arrow model for 1904. Willys decided that to counter this, he would contract the entire output of a reasonably priced company to ensure a constant supply for his quickly expanding sales network.
Encountering a business acquaintance, Willys learned of a company owned by Standard Wheel that had acquired a car built by Claude Cox which had been named the Overland. Familiar with Standard Wheel, which had an excellent reputation, Willys laid plans to make the Overland his sole source of cars, contracting the entire output of the factory. It was unfortunate that he didn't reference his source, to see what problems might lie ahead.
An explosion in the Overland factory disheartened the Standard Wheel directors in 1904. They lost interest, and the Overland went for a course set in ultimate bankruptcy. Before the papers were filed, the originator of the car, Claude Cox, purchased the company for $8,000. He modified the production area, and manufactured the cars via additional financing from David M. Perry. The company was reorganized in 1906 as the Overland Company. Willys sold Overland cars as fast as they could be shipped. A short but hard recession badly hurt David Perry, to the extent that he could not capitalize the Overland Company any further. Production ground to a halt while Cox desperately sought investors to keep Overland afloat.
Willys had banked upon Overland. In 1906, he sent a $10,000 check to the company to insure that he got the cars he needed to sell. All of a sudden, in November, shortly before Thanksgiving, shipments stopped, and no one was responding. John Willys got on the train, heading for the plant in Indianapolis.
Willys arrived on a Saturday. He was horrified at what he found. 45 cars sat on an assembly line, not finished. Parts were strewn about. Workers had not been paid. Checks had been sent out to the factory workers, but the bank account was some $350 short to meet all the pay. Claude Cox was despondent. Willys toured the entire facility. All the components were present to continue production of the quality Overland if, and it was a big if, financing could be found.
Taking a risk, after assessment of the situation, Willys called his financial friends back in Elmira. Based on his word, quick plans were laid out, and the funds were made immediately available the very next Monday for Willys to get the company back on firm ground. Able to raise $3,500 in one day was convincing authority for Overland's creditors, who were owed about $80,000. Willys was able to convince them to hold off so that he might get the company going. Working quickly, the production line was started, the workman paid, along with a Thanksgiving bonus, and shipping of new Overland cars resumed.
With Willys already accounting for the entire output of the 46 1907 cars, sales were positive. Staying on the scene, alternating between Elmira and Indianapolis, Willys saw production increased ten times to 465 new Overland cars. They were immediately shipped, having all been sold by Willys at $1,200 apiece. Realizing what he had, Willys made arrangements to buy the Overland company, renaming it Willys-Overland Company. His production had to increase with an ever enlarging demand for Overland cars through other outlets. He built a new factory in 1908, only to realize it had already been outgrown as it came on line!
Casting about, he recognized that he had to quickly move to meet demand or lose the orders. He thought he had made an exceptional deal when he acquired the Marion Car Company in Ohio in early 1909. On board was an excellent engineer and automotive whiz by the name of Harry M. Stutz. Stutz had his own plans in mind, and left to form his own company.
While formulating plans at re-organization of the Marion Company, a prize acquisition landed right on Willys’ lap. The Pope Motors factory in Toledo Ohio was modern, large, and set up for automotive production. Willys was able to acquire it for $285,000; it became the centerpiece of the "new" Willys-Overland Company.
Willys was able to recoup most of his initial $285,000 purchase outlay by selling off surplus. Willys got the Overland model 38 into production at Toledo on October 26, 1909, one day after his 36th birthday. This particular model had a sliding gear transmission, replacing the epicylic type.
The same year, 1909, Henry Ford introduced his Model T which had an epicylic transmission. For the model years 1910 through the end of the Ford Model T production in 1927, the Overland car was second in production only to the Ford. Henry kept dropping his prices, mostly by finding a means to produce the T cheaper by cutting items, using less expensive parts, or overlapping some process [editor’s note: Ford also engaged in some questionable labor practices including advertising, but not paying, high rates]. Overland did not do this. Quality wise, the Ford was considered somewhat unreliable, but easily repaired by your average farm boy, even at the butt end of all the jokes aimed at the "Tin Lizzie." However, the Overland was overall a superior car, and enjoyed a better reputation, even if it was more expensive.
By the end of 1910, Willys-Overland was producing over 4,000 cars a year. Every one of them was already sold. Thereby Willys-Overland ended up with a profit of over $1 million. John North Willys had literally snatched Overland from the jaws of sure death, to a solvency of capitalization of one million dollars! All done within about a year. There was no debt, Willys having paid it all back. Business leaders and banks were ecstatic.
Willys himself was a hard driven man who did not slow down. His doctors had to order him to take vacations. His personal work ethic was for 7 days a week, mostly 12 to 16 hours a day.
1910 production was 15,500 cars. By 1915, production was 150,000. Willys employed 18,000 people in Toledo, and 20,000 more in his plants in Elyria Ohio, Buffalo NY, and Flint and Pontiac MI. He re-organized the company in 1917, making it a holding corporation, so that he could acquire suppliers such as Auto-Lite spark plug company, putting a lot of them under his control. He also expanded, so that now his factories were producing 1,000 cars a shift. He often stated that he could catch and surpass Ford with a more powerful car that was better appointed. He never did really exert the effort to catch the Ford.
In 1913, Willys took a doctor ordered vacation to Great Britain. On the ship crossing over, he met Charles Knight, who had been manufacturing engines based upon a "sleeve valve" that replaced the traditional poppet valve used by all other manufacturers, including Willys-Overland. By the end of the voyage, Willys was nearly convinced of the advantages of the sleeve valve engine. He hired a Knight car, putting 4,500 miles on it over the 15 days he was in England, a feat in itself, given the state of roadways at the time. At the end of the trip, Willys was thoroughly bought over. However, he did not intend to pay a lot of royalties for use of the sleeve valve engine.
Casting about, he found that the ownership rights to the Edwards Motor Car Company located on Long Island New York were available for sale. They already had the license to make sleeve valve engines. Willys bought them out, and began to set up operations to produce them at his Elyria Ohio facility, eventually closing the Long Island plant.
The sleeve valve eliminated the poppet which meant no valves, no valve springs, lifters, push rods, or valve rocker arms. It meant a center location for the spark plug on the hemispherical head combustion chamber. This increased volumetric efficiency, making more power with less compression. It also meant no sludge build up nor carbon deposits.
In 1914, Willys was producing a six cylinder sleeve valve engine sold under the Willys-Knight name. The price range was around $2,500 for a nicely appointed sedan. In 1915, Willys moved the production of the car itself to Toledo, but the Elyria facility kept on manufacturing sleeve valve engines. A 4 cylinder was introduced. In 1917, a V-8 of some note for its power was introduced, and was sold through 1919.
World War I saw Willys engaged in the manufacture of tugs (tractors) at the Moline facility in Minnesota under contract for the military (it was later reorganized to become MinneapolisMoline, probably around 1935 when Bantam Chairman Roy Evans gained controlling interest of Willys-Overland); one of the Moline tugs was named "Jeep," which would have implications later. He also built another facility to manufacture trucks strictly for military contract. MinneapolisMoline kept right on building the Jeep tugs, even through World War II. The Navy used them exclusively to move aircraft around on the ground and on aircraft carriers.
He also built military aircraft engines, of which one model was adopted to power beach landing craft.
The problems started when Willys moved his headquarters to New York in 1918 to be more effective in control of his empire. He purchased the Moline Plow Company that year after having seen the work that they did for the war effort. They retooled from the military contracts to manufacture well made, reliable, tough tractors and farm implements. In 1919, Willys gained control of the Duesenberg Company, mainly to obtain the Elizabeth New Jersey Plant. Willys had planned on manufacture of a "new" 6 cylinder car at the facility.
Willys always got along with the labor on the floor, but he was also always around, with his 14 to 16 hour work ethic for seven days a week. With his move to New York City, the quality of interaction declined, and huge labor unrest arose at the Toledo facility. It dissolved into a prolonged, ugly strike at the plant in 1919. Shutting down the plant for several months caused a riot, which was finally quelled by local police, along with intervention of Federal Courts, as the Governor threatened National Guard activation.
With a combination of these factors, a short, but deep recession caught Willys short for the first time. He had overextended. His nervous creditors moved into immediate receivership. Willys set about to rectify the situation. In the interim, Willys was forced to deal with the creditors’ appointed agent, who had the authority to run the company, Walter P. Chrysler. Chrysler had retired, essentially from Buick in 1920, after repeated clashes with W C Durant. He certainly did not need a job or more money, having amassed a fortune from Buick stock and several railroad investments.
Aware of his abilities, the bankers approached Chrysler to bring Willys-Overland out of receivership, and save it from total bankruptcy. Chrysler considered the proposal. Perhaps out of a desire not to be hired, he demanded an outrageous salary of $1 million per year for the two year contract, to be paid no matter what the outcome of his efforts was. The bankers didn't blink.
John Willys wasn't happy to have to deal through Chrysler to get anything done. He also held a certain amount of distrust about Chrysler's true motives. Chrysler felt that to bring Willys-Overland out of their situation, besides selling off assets, a totally new car was needed. As it happened, three young engineers laboring at the Elizabeth plant had such a car design, well into the planning stage. It had a totally new six cylinder engine with high compression. Further, the chassis was to have four wheel hydraulic brakes.
John Willys had already recognized the work of the three "musketeers" as they called themselves. Zeder, Skelton and Breer (ZSB). It was a point that Willys and Chrysler agreed upon. The plan was presented to the bankers. Nervously, within a few weeks, they rejected it. They felt that something more tried and true should be built, instead of a totally new untried car. Willys shrugged and set back to regaining control of his company and the company fortunes.
Chrysler had a little more on his mind. He saw the new car as a means to his own ends. As well, the Elizabeth Plant was going to be put up for auction to raise money for Willys-Overland. Chrysler sought to gain the plant for himself, then turn the tables on Willys by getting the stock holders to back him, forcing Willys out. Then he could build that new car, only not as an Overland, but as his own car, the Chrysler.
John North Willys had a formidable reputation as an honest, hard working, caring man. When Chrysler attempted the stock takeover to force Willys out, the stock holders rejected the concept out of hand, turning Chrysler decisively away. He had by then been approached by the Maxwell-Chalmers Motor Company that was also deeply overextended, and in danger of going under. Bankers are bankers. Seeking to protect one another, lest any money be lost between them, they agreed to allow Chrysler to work outside the Willys-Overland contract on the Maxwell-Chalmers situation. Chrysler immediately saw another opportunity with the Maxwell, with special focus on the lackluster Chalmers. Bankers were holding a large block of stock in Chalmers and Maxwell, besides extending credit money to them both. Chrysler knew this going in, as well as knowing they only had credit money involved in the Willys-Overland deal.
Chrysler set about to get Willys-Overland back on track. By 1921, he had reduced the Willys-Overland debt from $48 million down to $18 million. He then left.
Free now from Willys-Overland, he concentrated on the Maxwell situation. Quietly, he began by buying stock from the bankers. Most of it. Not enough to gain full control, but close. He maintained constant contact with the ZSB engineering team. They continued development of the new high compression engine car in Elizabeth.
The Willys-Overland company went into bankruptcy three months after Chrysler left them for Maxwell. Some said Chrysler had set it up to fail, since he knew that the plant in Elizabeth would be among the items that would be sold. The Elizabeth plant did go up for sale, along with Willys-Overland New Process Gear Company in Syracuse. Chrysler sent a representative to the bankruptcy auction at Elizabeth. The agent was to offer no more than $5 million for the $14 million facility. Unexpectedly, some very strong competition was encountered. The sale was completed when W.C. Durant (of General Motors and Chevrolet fame) won with a bid of $5.2 million, ultimately producing the Flint car there. The three engineers remained, but the Flint was in no measure anything compared to the proposed Chrysler car.
With the $5.2 million from the Elizabeth sale, and $10 million from the New Process Gear Company sale, John Willys was able to bring Willys-Overland out of bankruptcy in early 1922, in full control. He set about to build a second automobile empire from there, well onto solid footing. The Willys-Overland car continued on its successful path.
In 1925 John Willys bought the Stearns Motor Company, which made luxury autos. They had been utilizing the Knight Sleeve Valve engine since 1911. They were every bit as refined as Packard or Pierce-Arrow, and Willys was immensely pleased with the acquisition. Sales of the upper priced car climbed to 50,000 annually, at an immense profit.
Willys noted that Walter Chrysler had turned the fortunes of Maxwell around, selling some 80,000 of them in 1925. Chrysler also sold 32,000 cars with the Chrysler brand on them, although a lot of them closely resembled the Chalmers body style. Chrysler had used the Detroit Chalmers plant to set up the production line for his Chrysler cars. The high compression six cylinder, along with the four wheel hydraulic brakes, put Chrysler cars in a class by themselves. Top speed was about 75 miles an hour, which was within 5 miles an hour of the Packard that was significantly higher priced.
A year before, Walter Chrysler had borrowed $5 million from Chase Securities to finance his car, placing his personal assets on the line. One year later, Chrysler turned a profit of $17 million, paying Chase back, and then some.
Willys always stated that he could whip Ford if he desired. Willys had a totally new car in the planning which he believed could do just that. Introduced on May 12, 1926, simultaneously in Canada, the United States, and Australia, the Whippet was the smallest 4 cylinder car on the market. At the same time, production of the Overland marque was ended, replaced by the Whippet.
Whether by design or by oversight, the Whippet nameplate was not displayed on the first models. They had Overland hub caps and Overland radiator tags. Although advertising never mentioned Overland directly, some brochures did state that it was an Overland-Whippet. The next Whippet model, for 1926, removed any doubt that it was a Whippet, exhibiting the name in all the right places.
Quickly, seeking to expand its line up, the Overland 93 model, which had a six cylinder engine, got changed into a Whippet 93 making its introduction as a new 1927 model, even though it was still an Overland. The four cylinder Whippet, however, continued to make the bulk of sales.
Whippet when introduced had a technically refined engine with pump forced cooling, full pressurized lubrication, and four wheel hydraulic brakes. The cars were said to be based upon European designs, which were light, sturdy, fast, dependable, economical to operate, and inexpensive to buy. They ranged in price from a fairly well equipped lead model at $525, to the most expensive salon at $850. People mobbed the showrooms. It was estimated that on introduction day, over 14 million people visited Overland showrooms in the United States. It was neat, very well made, and stylish. Sales took off.
The 1927 4 cylinder Whippet had about 35 horsepower, and 90 ft lbs of torque. In the light, smaller body of the Whippet the mighty little engine made the Whippet feel and handle like it was lively and quick. This was a significant engine, even if Willys and the world did not recognize it as yet. It would be the basis for the "GO-DEVIL" engine that powered thousands of Jeeps. The Whippet itself may have well been the major reason why Edsel Ford kept mentioning to Henry, his father, that Ford needed to update their cars. Whippet production easily jumped to 100,000. By 1929, Willys-Overland production had hit 320,000 cars. His profit was $187 million.
Abruptly, John North Willys resigned as President. He sold all his common stock for $25 million. He did retain his title as chairman of the board. He got out before October 29, which was the day that the NY stock market began it's fast track to its crash, leading the way into a world wide depression. The Stearns-Knight ended production, and was liquidated in lieu of complete bankruptcy.
In 1930, John North Willys was appointed Ambassador to Poland. He took the post immediately. One year later, in 1931, Whippet production ended. The Whippet was replaced by a Willys model 4 cylinder 77, and a Willys model 99 that had a six cylinder. Financially, things were shaky. To try to stop bankruptcy, with the deepening depression, the Canadian subsidiary was sold off, along with some other plants. A leasing company was formed; Willys paid rent to keep the production facility within them going.
In 1933, Willys-Overland went into receivership. Hurriedly, Willys returned to try to save the company. Without any preamble, or mention of marital problems, Willys divorced his wife of many years in 1934. He quickly remarried in 1935. He became the President, again, of Willys-Overland, also in 1935. However, while at his home in the Bronx, New York, John North Willys suffered a heart attack on August 26, 1935. He did not survive.
In 1936, the bankruptcy recovery plan had been accepted, and Willys-Overland Company emerged as Willys-Overland Motors, Incorporated. It remained profitable, just not as profitable as it had been. A sort of consortium of management types ran the company, and were very cautious about making any changes.
The company continued on going through the World War II years with the awarding of the open bid contract to build the GP (Jeep) for the military. After resuming production for the public in 1946, Willys did choose not to make cars, instead building Jeeps for the civilian (CJ, or Civilian Jeep) markets. Willys returned to making cars from 1951 to 1955, with little success, focusing instead on its durable trucks.
In 1953, Kaiser Corporation bought out Willys-Overland Motors, and renamed it Willys Motors Company. In 1963 the company re-organized, becoming Kaiser-Jeep Corporation, and the Willys name disappeared into history (though Overland was used as a premium Jeep model, and a concept Jeep Willys was created).
In 1970, Kaiser Industries decided to leave the automobile business, selling Kaiser-Jeep to American Motors Corporation, which had been created from the merger of Hudson and Nash. Not ten years later, after being hit by fuel crises and lack of acceptance of its new designs, AMC sold a major portion to Renault, of France, in 1979. Chrysler Corporation acquired all of AMC in 1989 from Renault, which had been unable to find acceptance for its own new designs. In 1998, though flush with success, Chrysler was acquired by Daimler-Benz of Germany, becoming the DaimlerChrysler Company, AG. It was then acquired by Cerberus Capital Management in 2007. From 1953, every ten years or so, Willys-Overland had been reorganized or purchased.
I cannot imagine that someone as vibrant and honest as John North Willys would be pleased at the turn of events.
