Rise and Fall of General Motors

How the perfect storm of commercial forces created the world’s largest corporation, enslaved us to gasoline, and ultimately brought the car maker to its knees

By Marc J. Rauch
Exec. Vice President/Co-Publisher

In the early years of the automobile industry there was uncertainty as to which fuel, and what type of engine would power the new vehicles. The internal combustion engine (ICE) was the solution. There were two types available: spark ignited and compressed hot air ignited. Compressed hot air ignited ICE uses diesel fuel. Spark ignited internal combustion engines are today most commonly associated with gasoline, but ethanol, methanol, natural gas and propane can also work.

At this point the two most available fuels for spark ignited ICE were liquid; either alcohol (ethanol or methanol) or gasoline. Alcohol enjoyed wide support from automobile pioneers, such as Henry Ford and General Motors’ top scientists, because it could be produced almost anywhere by almost anyone (alcohol distillation technology has been in the public domain for hundreds of years). Alcohol fuels also produced superior performance compared to gasoline. Alcohol-powered engines allowed for higher piston compression, which deliver more speed and power. Gasoline caused a knock in high compression engines that would literally “knock” the engine to destruction. Only low compression, lower speed engines could safely use gasoline. Early on, as speeds were measured against human walking or horse riding, this was acceptable. But as roads were leveled and paved and consumers wanted bigger faster vehicles this was a huge limitation. One of the solutions to gasoline knock was to blend ethanol into every gallon of gasoline. The alcohol quieted the knock, thereby allowing the gasoline-ethanol blend to be used in better performing engines.

Before and during Prohibition, Henry Ford expressed his belief that alcohol (ethanol) was the fuel of the future. His Model T, the product that is said to have given birth to moving assembly line production, was designed and built to use ethanol or gasoline by giving the driver adjustable carburetor and spark advance controls that optimized the performance of the fuel used.

Even after Prohibition commenced, General Motors’s top scientists, Charles F. Kettering, Thomas A. Midgley and T.A. Boyd, continued their belief that ethanol was the fuel of the future. Considering that it was illegal to even produce the small amounts to conduct tests, alcohol was still being experimented with as the best alternative solution to gasoline’s knock problem.

However, in 1921, GM’s scientists discovered that by adding tetraethyl lead to gasoline that the knock was subdued and the new lead-gasoline fuel could be used in advanced higher compression engines. This was the early days of the Roaring Twenties and in order to really roar, the public needed a fuel to set them free.

The leaded gasoline didn’t just give GM the ability to build vehicles with higher performing engines it gave them a unique process that they could patent (emphasis added). GM combined their process with similar processes being tested by DuPont Chemicals and Standard Oil, which gave GM three cents on every gallon of leaded gasoline sold anywhere in the world. They quickly determined that their share of profits in the sale of leaded gasoline would be worth many billions of dollars over the next couple of decades.

The gasoline profits allowed General Motors to become a bloated, inflexible entity, incapable of – and disinterested in – meeting the challenges of new design, technologies, demographic shifts, societal attitudes about the environment, and the up-start band of oil-dictators called OPEC. As the years passed, and as new faces came onboard, the knowledge of this gasoline-profit advantage was lost. They thought they were invincible…they thought they were successful solely because they built a better car.

Perhaps, if the 70’s gasoline crisis didn’t happen, and if the environmental movement failed to take hold, or if the gasoline companies could have continued to lie about the negative effects of leaded-gasoline – and get away with it – then General Motors might have been able to exist without their share of profits from the patents. But the combination of these factors created the perfect storm that set the stage for GM’s tumble.

Chained to Oil

We in America and in all industrial nations of the world, no longer “drink” from an unpolluted spring; we haven’t for more than half a century. We are addicted to using fuel that robs each and every one of us of our hard earned money. What’s more, over-hyped worrisome economic or political news about oil, and the greedy cycle of oil commodity speculation keeps all segments of the financial markets teetering on the brink of disaster. The richest and most wonderful country in the world has become just another debtor-nation. 50% or more of our national debt is owed to other countries to pay for the oil that we helped discover, subsidize, and then protect through two world wars and several regional conflicts. And we are forced to fund terrorist regimes who would like to see us dead.

When General Motors lost their way ninety years ago the United States lost its economic and energy independence.

http://www.theautochannel.com is an excellent source for alternative fuel information. Full text of this article at http://www.theautochannel.com/news/2012/04/06/031731-rise-fall-general-motors-and-subjugation-industrialized-world.html

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