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09/21/2007

The Edsel

This month marks the 50th anniversary of the Edsel, one of the
all-time product busts. What happened, and why the name?

With the post-World War II surge in consumerism, by 1950 there
were 1 million families in the United States who could afford
two cars. By 1960, this figure was expected to be 7 million.

General Motors at this time had emerged as the #1 automaker
and as families outgrew their Chevy, or could afford a second,
high-end vehicle, they moved up to a Pontiac, Buick,
Oldsmobile, or Cadillac. For its part, Ford could offer its
Mercury or Lincoln lines, which were perceived to be more on
the luxury side. So Ford sought to fill the middle rung.

1955 was Ford’s most successful ever thanks to the introduction
of the Thunderbird and Ford decided to set aside $250 million
($2 billion in today’s dollars) for what would become the Edsel
and an entirely new division.

While the designers toyed with their models, the chosen
advertising agency, Foote, Cone and Belding, was sifting through
18,000 possible names, which it then winnowed down to 16.
Some of these were doozies like Utopian Turtletop (selected by
a famous American poet of this era, Marianne Moore) and
Elkherd.

More conventional offerings in the final cut were Phoenix,
Altair, Citation, and Corsair, with the latter two being the top
choices of the creative folks. But management went in a totally
different direction the new car would be called the Edsel, after
Henry Ford’s late son. Market research showed consumers
associating Edsel with “diesel” and “weasel,” but no matter,
Edsel it was.

It’s been said that the original design of the car was superb, but
then Ford’s accountants demanded one cost-saving measure after
another and most would agree the finished product was uuuu-gly.

Some said the vertical front grilled evoked female genitalia,
though at the time GM was featuring cars with pointy bumper
guards that distinctly resembled bras. Others said the grille
looked like a bird’s beak.

Columnist George Will recently wrote of the Edsel
misadventure:

“Remember the basketball coach who said of his team, ‘We’re
short but we’re slow’? The Edsel was ugly but riddled with
malfunctions. So many malfunctions that some people suspected
sabotage at plants that had previously assembled Fords and
Mercurys. Those two Ford divisions perhaps hoped the Edsel
would bomb.”

The Edsel was formally launched on Sept. 4, 1957, and in the
first weeks and months there were millions flocking to Ford’s
showrooms, but few actual buyers. How few? Try 64,000 cars
sold the first year. It didn’t help that the economy was entering a
recession, and that a week before the introduction, the USSR
announced it possessed a missile capable of dropping a bomb
anywhere in the U.S. Then a month after the launch of the Edsel,
the Soviets launched Sputnik, which shook America up further.
Not a great time to be selling big ticket items, it turned out,
especially ugly ones, and the Edsel went from wundercar to
laughingstock. It lasted all of 26 months.

As George Will wrote:

“The short, unhappy life of that automobile is rich in lessons, and
not only for America’s beleaguered automobile industry. The
principal lesson is: Most Americans are not as silly as a few
Americans suppose.”

But on a different topic, I was reading a Newsweek piece on the
history of computers, and I see that the name Altair was an
important one back in 1975. The ‘Altair 8800’ was the first
personal computer, costing $495 assembled. 1975 was also the
same year Bill Gates and Paul Allen founded Microsoft.

Sources:

Martin S. Fridson, “It Was a Very Good Year”
Steven Levy / Newsweek
Rick Newman / U.S. News & World Report
George Will / Washington Post

Wall Street History returns in two weeks.

Brian Trumbore



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-09/21/2007-      
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Wall Street History

09/21/2007

The Edsel

This month marks the 50th anniversary of the Edsel, one of the
all-time product busts. What happened, and why the name?

With the post-World War II surge in consumerism, by 1950 there
were 1 million families in the United States who could afford
two cars. By 1960, this figure was expected to be 7 million.

General Motors at this time had emerged as the #1 automaker
and as families outgrew their Chevy, or could afford a second,
high-end vehicle, they moved up to a Pontiac, Buick,
Oldsmobile, or Cadillac. For its part, Ford could offer its
Mercury or Lincoln lines, which were perceived to be more on
the luxury side. So Ford sought to fill the middle rung.

1955 was Ford’s most successful ever thanks to the introduction
of the Thunderbird and Ford decided to set aside $250 million
($2 billion in today’s dollars) for what would become the Edsel
and an entirely new division.

While the designers toyed with their models, the chosen
advertising agency, Foote, Cone and Belding, was sifting through
18,000 possible names, which it then winnowed down to 16.
Some of these were doozies like Utopian Turtletop (selected by
a famous American poet of this era, Marianne Moore) and
Elkherd.

More conventional offerings in the final cut were Phoenix,
Altair, Citation, and Corsair, with the latter two being the top
choices of the creative folks. But management went in a totally
different direction the new car would be called the Edsel, after
Henry Ford’s late son. Market research showed consumers
associating Edsel with “diesel” and “weasel,” but no matter,
Edsel it was.

It’s been said that the original design of the car was superb, but
then Ford’s accountants demanded one cost-saving measure after
another and most would agree the finished product was uuuu-gly.

Some said the vertical front grilled evoked female genitalia,
though at the time GM was featuring cars with pointy bumper
guards that distinctly resembled bras. Others said the grille
looked like a bird’s beak.

Columnist George Will recently wrote of the Edsel
misadventure:

“Remember the basketball coach who said of his team, ‘We’re
short but we’re slow’? The Edsel was ugly but riddled with
malfunctions. So many malfunctions that some people suspected
sabotage at plants that had previously assembled Fords and
Mercurys. Those two Ford divisions perhaps hoped the Edsel
would bomb.”

The Edsel was formally launched on Sept. 4, 1957, and in the
first weeks and months there were millions flocking to Ford’s
showrooms, but few actual buyers. How few? Try 64,000 cars
sold the first year. It didn’t help that the economy was entering a
recession, and that a week before the introduction, the USSR
announced it possessed a missile capable of dropping a bomb
anywhere in the U.S. Then a month after the launch of the Edsel,
the Soviets launched Sputnik, which shook America up further.
Not a great time to be selling big ticket items, it turned out,
especially ugly ones, and the Edsel went from wundercar to
laughingstock. It lasted all of 26 months.

As George Will wrote:

“The short, unhappy life of that automobile is rich in lessons, and
not only for America’s beleaguered automobile industry. The
principal lesson is: Most Americans are not as silly as a few
Americans suppose.”

But on a different topic, I was reading a Newsweek piece on the
history of computers, and I see that the name Altair was an
important one back in 1975. The ‘Altair 8800’ was the first
personal computer, costing $495 assembled. 1975 was also the
same year Bill Gates and Paul Allen founded Microsoft.

Sources:

Martin S. Fridson, “It Was a Very Good Year”
Steven Levy / Newsweek
Rick Newman / U.S. News & World Report
George Will / Washington Post

Wall Street History returns in two weeks.

Brian Trumbore