The Beginnings of the Automobile

By Raymond Viger

In the beginning, the car company started by Henry Ford had as its aim to bring the automobile to the rural population. By 1920 this objective had been realized. Were auto manufacturers content with achieving this? By no means. Expansion is a laudable goal for any company. But were the means used to get there socially acceptable?

In this era, the city was not an inviting place for the automobile. There were no parking spaces, the speed limit was capped at 20 km/hr, there were horses everywhere, tramways were running… Indeed, tramways, also called streetcars in the U.S., provided an excellent mode of urban transport, as did the underground subway.  

Alfred P. Sloan, President of General Motors from 1923 to 1956, had as his battle cry: “Make the streetcars disappear!”  He created a “special unit” within GM whose mission was to come up with a strategy to replace electric streetcars with gas-powered buses. Then, by discrediting public transport, automobile companies could sell their products to individuals so that people could get around in urban centres. This strategy lasted until 1960.

Rail Networks

In 1920 the U.S. had 1,200 streetcar companies with 17,000 miles (27,359 km) of rail lines, employing 300,000 people. They transported the equivalent of 14 billion passengers per year.   

The purchase and dismantling of smaller public transit services posed no problem for GM. The big networks, like the New York Railway or Los Angeles’ Pacific Electric, were tougher to acquire. If GM couldn’t make them disappear, their whole strategy would fail.

GM discovered that the owners of these larger networks were electric companies, who used their unprofitable streetcar operations to compensate for the enormous profits generated by selling energy, and thereby avoided paying taxes.

At the beginning of the 1930s, GM denounced this practice by showing the losses that governments were incurring in unpaid tax revenue. Congress adopted a law forbidding energy companies from owning public transit companies. So the electricity producers had no choice but to sell off their streetcar holdings to GM for fire-sale prices.

In 18 months, 150 miles of streetcar lines in New York were dismantled. It was the end of New York City’s public transit system.

To camouflage its acquisitions and dismantling activities, in 1936 GM founded a shell company, National City Lines (NCL). To confuse its detractors, NCL created numerous sub-companies which each covered a part of U.S. territory. An alliance was forged with Standard Oil (oil and gas) and Firestone (tires).

The result: over 100 streetcar networks in 60 cities simply disappeared. For these antisocial acts, in April of 1949 a Federal jury declared GM guilty of conspiring with Standard Oil and Firestone. They were fined $5,000 U.S. The treasurer of GM was also found guilty, and fined one dollar.

Montreal’s Tramways

On March 19, 1946, the president of the Montreal Tramways Company, Robert Watt, raised the issue of traffic jams in Montreal. At the time his tramways carried 1,200,000 passengers per day, or 398,349,773 per year. Watt questioned why the tramway fleet hadn’t been rejuvenated since the end of the war. In 1959, Montreal would see the last of its tramways.

– This is an excerpt from the book Regard vers le future (A Look at the Future), published by Éditions TNT.

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