The document files contain information about the development of this leading steel market, including automobile-industry and company histories, the production of automotive steels, growth of the auto-steel market, the location of U.S. auto plants, the auto industries of Japan and Korea, world auto-industry relationships and surveys, auto-industry economics and competition, industry capital expenditures, auto-company sales and profits, partnerships between the steel and auto industries, competition from substitute materials, plastics and auto recycling, automotive use of Zincrometal, statistical references and research, motor-vehicle statistics of Japan, statistics on trucking, trucks vs. freight trains, the Titus mill and the automobile body, early automobiles, the Selden Patent, automobile mass production, the Chrysler and American Motors merger, interviews with Charles S. Mott of General Motors and Edward Fisher of Fisher Body, automobile and truck brochures, and publications of the Automobile Manufacturers Association (AMA) and General Motors Corporation. In addition, the AMA publication Automobile Facts and the IISI report Intermaterial Competition for the Body in White of the Passenger Car are contained in the Archive’s reference collection.
Analysis: In 1900, there was such fear surrounding the first automobiles that a Vermont ordinance required a mature person waving a red flag to walk one-eighth of a mile in front of any moving vehicle. For the steel industry, automobile builders scarcely existed as a market, and except for engine production, wood was practically the universal automotive material, not only for the body, but for wheels and axles as well. The sheet and alloy steels that one day would be widely used by the auto industry were produced only in limited quantities.
During 1900-1920, all of this started to change. The hundreds of small car-building shops of the 1890’s gave way to fewer, more entrepreneurial companies with innovative leaders, who eventually transformed the automobile from an expensive horseless carriage into a more reliable and affordable mode of transportation. Leaders named Benz, Buick, Durant, Ford, Leland, and Olds did this by adopting the basic principles of mass production, including the assembly line, standardized and interchangeable parts, and efficient plant and equipment layouts, all manufacturing methods they appropriated from the meat-packing, firearms, and machine-tool industries and then brought to new levels of refinement and perfection.
As automobiles started to win broader acceptance, the steel industry and other suppliers strove to meet the auto industry’s special needs. States and localities started to build paved roadways, which were practically non-existent. Gasoline was made more plentiful by advances in the cracking process for petroleum, and the rubber industry worked to develop smoother-riding, more wear resistant tires. One by one, limitations on the auto industry’s growth started to be eliminated.
At first, automakers pretty much took their steel as they found it, using steels produced for other purposes. Gears were cut from tool steel, and engine parts were made from billets intended for rolling rails. Tubing for bicycles was used in building chassis, and cylinders were cast from iron suited for stoves. All of this made for vehicles that were constantly breaking down, and by 1905, auto engineers, notably those at Ford Motor Company, had identified the need for automotive steels with particular properties. Before long, the interdependence of the steel and automobile industries was to become well established.
By 1910, the development of alloy steels made to automakers’ specifications was proceeding rapidly, and the Society of Automotive Engineers (SAE) went to work in establishing a standard specification system to classify steels by alloy content. Up to that time, the preoccupation of automakers with mechanical problems saw most auto-body design and construction farmed out to builders of coaches and buggies. Accustomed to working with wood, they first used steel panels attached to wooden frames only because finishing the steel took one-third less paint than did wood sheathing. The early bodies they designed were a mass of straight lines and right-angle bends, so that steel sheets without drawing qualities, similar to black plate for tinning, were adequate for their needs.
After 1910, angular automobile designs started to be discarded in favor of more contoured models, a trend that called for the development of forming dies, stamping presses, and above all, higher grade, drawing-quality steel sheets. Auto companies began to specify sheets having particular formability and surface qualities, and the steel industry worked to meet these demands by improved box annealing and by supplying unprecedented quantities of hand-rolled, full-finished sheets for the stamping of hoods, hood sides, and fenders.
By 1920, although the railroad industry remained the principal market for steel, the auto industry had become one of the fastest growing sources of steel demand. That year, U.S. automakers consumed 915 thousand tons of rolled, finished-steel products, up from only 71 thousand tons ten years earlier. This increase in the auto-steel market reflected the growth of car and truck production from 187 thousand to 2.2 million units.
Industrial growth during 1920-1930 was spearheaded by the automobile industry, which continued to place demands on its supplier industries for ever-increasing quantities and qualities of their diverse products. Among the important factors driving the auto industry’s growth were a shift from the open to the closed car, lower car prices, lower operating and repair costs, credit and installment buying, and a four-fold expansion in the miles of paved roads and highways.
The shift to the closed car and the introduction of the monopiece body by the Budd Company brought radical changes in stamping requirements and placed demands on the steel industry for much wider, hand-rolled sheets. However, beyond upgrading their hand-rolling operations, steel producers were to respond to burgeoning sheet demand by adopting one of the all-time, most significant advances in steel technology, the continuous hot-strip mill. In January, 1924, the American Rolling Mill Company placed into operation at its Ashland , Kentucky plant the first successful continuous wide strip mill, which by 1927 was rolling 36 thousand tons a month, twice the level needed to make the mill pay. By the mid-1930’s, the U.S. steel industry was to invest half a billion dollars to install 27 such mills with a combined annual rolling capacity of nearly 13 million tons.
The auto industry was to be the principal steel consumer served by this new capacity. However, the auto market’s growth was interrupted by the Depression, followed by the suspension of civilian auto output in mobilizing for World War II. In 1929, the industry sold 5.3 million vehicles, a record that would stand until 1949. Automotive steel consumption in 1929 reached 5.5 million tons, marking a five-fold increase in under ten years. But this tonnage wouldn’t be regained until 1936-37, and at the depths of the Depression in 1932, auto output dropped to 1.3 million units, the lowest level since 1918.
Rather than slowing automotive progress, the weak auto market of the 1930’s heightened competition and gave rise to major design changes, aimed at adding sales appeal to cars of the day. Such innovations as the all-steel body, the turret-top, and streamlining, not only increased the steel content of the average car, but also called for the development of more advanced drawing-quality sheets with metallurgical properties capable of withstanding the radical stamping impressions needed to execute the new designs. The steel industry was quick to respond to this requirement, given extremely depressed overall steel demand and the fact that the auto industry, having displaced the railroads to become the leading tonnage consumer of steel in 1931, was by then firmly established as the most important steel market in revenue terms as well.
In 1948-49, as automakers worked to keep pace with pent-up demand after World War II, U.S. car and truck output once again climbed above the five-million-unit level, last exceeded 20 years earlier. However, given the significant design changes favoring steel, many of which had been initiated in the 1930’s, each post-war motor vehicle contained an average 75% more steel, boosting the auto industry’s yearly steel consumption toward 10 million tons for the first time.
In 1950, when world motor vehicle production was approximately 10 million units, North American automakers accounted for an output share of more than 80%. Over the next fifty years, world production trended upward to 58 million units in 2000, and the North American output share declined to some 25%, with roughly equivalent shares accounted for by Europe , Japan , and all other nations. This growth and geographic dispersion of car and truck production made the automobile industry a major, if not the leading, source of steel demand in many countries, including the United States, Canada, Brazil, Japan, Korea, the United Kingdom, Germany, France, Italy, and Spain.
By the late 1950’s, an active international trade in motor vehicles and parts started to emerge, with the United States becoming the major import market for Volkswagen Beetles and Toyotas. Since then, the world auto trade has become a $500-billion-plus annual business, increasing international competition, most notably in the United States, Europe, and Japan, as well as international auto-company ownership, joint ventures, and the establishment of so-called transplant manufacturing facilities. In addition to becoming increasingly international, the world auto industry has undergone other major changes that have influenced its role as the steel industry’s most important market. In the late 1960’s, growing concerns for the environment and automotive safety started to bring about revolutionary advances in automotive design and engine technology that have continued to the present.
In the 1970’s, OPEC’s two major oil shocks set in motion programs to downsize U.S. cars and to reduce the weight of vehicles everywhere in the interest of increased fuel efficiency. This led to increased materials competition from lighter substitutes, including plastics and aluminum, and also to ongoing innovations by the steel industry, including the development of light-weight-high-strength steel sheets, high-tech galvanizing and other corrosion-resistant sheet coatings, and the manufacture of tailor-welded blanks or semi-parts for auto-body construction.
The many challenges faced by the automobile and steel industries have forged an even closer working relationship between them, typified by the Auto/Steel Partnership Program, which involves both industries in nearly every phase of automotive design. The result has been to convert all high-volume vehicles to weight-saving monologue construction in which the steel body itself accounts for the vehicle’s styling, structural integrity, and crash-energy management. Such auto-steel advances have enabled automakers to fulfill their obligations to the environment, fuel economy, and passenger safety, while continuing to meet the market’s needs for a wide variety of vehicles, from sedans and coupes, to minivans and sports-utility vehicles (SUVs). Now, as automakers look to build tomorrow’s hybrid- and hydrogen-powered cars, their close interdependence with the steel industry insures their continuing role as the largest and most important steel market.