Henry Ford’s Contribution to Cost Minimization

The world today is a very technologically advanced planet. From laptops getting smaller and their processors getting faster to automobiles soon to turn completely electric. All these innovations are made possible by engineers; however, engineers are also the reason why these expensive products have only decreased in price while the technology has been improving. The decrease in price is because engineers help companies find ways to achieve total cost minimization even in the high cost economies, engineers help these companies by designing production methods that increase efficiency.

The most common method is the practice of assembly lines, which was designed by a man named Henry Ford in 1913 and is widely known as the most technological advancement of the twentieth century.

Total cost minimization is very important to engineers in high cost economies, this is because over the last century, all aspects of manufacturing have drastically increased in price. From labour, rent, insurance etc. The prices of labour in todays society have sky rocketed with a minimum wage in Canada currently at fourteen dollars per hour, the risk of many products increasing in price is at large.

The price of transporting products from factories to stores has also increased in price due to the cost of petroleum growing. However, engineers are the only people that can help these companies operating in high cost economies, this is because engineers can help design and manufacture systems and machines to help companies keep their operating costs down. The way engineers do this is by the use of conveyor belts with workers placed at strategic locations along the line, this practice is called the assembly line.

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Engineers also design the machines automated to do the same work as humans, but in a fraction of the time.

There are a few different types of assembly line systems engineers use to help companies achieve total cost minimization in high cost economies according to the website INC.com these methods are called “Modular, Cell, Team and U-shape assembly lines.” The modular assembly line uses two parallel assembly lines that manufacture two different types of products and when those products are finished they are placed on one final assembly line, in which they are assembled onto a product.

A common use for the modular assembly line is in the production of automobiles. The cell assembly line uses machines that can perform multiple tasks, while just one operator is using the machine. A common use for the cell machine is that it can weld, handle materials and even assemble products, the use of the machine cuts operating time and costs down and is commonly used in the manufacturing of parts for machines, due to the number of welds and small bolts that need to be tightened at specific torques. The team production method of the assembly line is when workers are together in teams along a parallel assembly line and perform the same repetitive tasks over and over, the team production is commonly used when installing simple doors on cars or factory emblems on vehicle rims. Finally, the U-shape assembly line is commonly used when manufacturing difficult products, this is because the method behind the U-shape is that the workers manufacturing the products can communicate easily about the speed and any common issues they encounter while in the manufacturing process.

Total cost minimization is crucial for engineers of todays society because, in these high cost economies the manufacturing process can be much too expensive. However, since engineers are improving the ways production can happen, and answering the call to society’s ever-increasing economy price, the people of society can still have the access to the quantity of goods for the same price because of the efficient practice’s engineers are implementing in the manufacturing of the products society needs.

Henry Ford used manufacturing engineering to reduce the total costs of automobiles by implementing the practice of the assembly line to manufacture the Ford Model T in his automotive factories in 1913 (history.com). In the late 1800’s and early 1900’s the Ford Model T and automobiles alike had a price tag of about $825 (anythingaboutcars.com). That price may not sound like much today but to put things in perspective the average person in the early 1900’s made about only “$2.19 per day” (Wiley.com). So, the cost of driving was simply out of the question for most Americans. The high cost to purchase an automobile at the time was directly related to the practice of auto manufacturing being a very time consuming and labour-intensive task, this was due to many inefficiencies in the production process.

However, Henry Ford changed the lives for Americans and people all over the world who thought they would never be able to afford a car, by innovating the way vehicles could be assembled. Henry Ford implemented conveyor belts into his factories, the point of the conveyor belts was to bring the parts that had to be assembled directly to the workers. This was instead of the workers leaving their station to get parts and tools, therefore there was no reason for any worker to leave their assigned position. Henry Ford also believed that repetition was the key to an efficient manufacturing plant, each worker performed the same task over and over day in and day out.

This work was so repetitive that it proved to not need skilled workers anymore. The practice of using the conveyor belt along an assembly line proved to be so efficient that according to Wiley.com Ford could produce “260,720 cars with 13,000 workers, compared to other companies which took 66,350 workers to produce 286,770 cars in 1914.” Henry Ford kept innovating his assembly line by incorporating new tools and systems to continue decreasing the amount of people it took to assemble cars, while increasing production. Production was so efficient that according to the website anythingaboutcars.com “New model T’s were coming off the line at the rate of one car every 24 seconds.” While the ford company could produce the Model T every 24 seconds, the price of the automobile plummeted to just $290 (history.com) making it affordable to just about anyone in society at that time and changing the way products could be manufactured forever.

The Ford model T was obviously a massive success for Henry Ford and his company, the model T made Ford a substantial amount of money turning him into a billionaire. The Model T was the best-selling car in history at that time and still is today having produced over fifteen million cars in the eighteen years of its production life (history.com) turning Henry Ford into the first American billionaire. The car was such a success Ford did not even think of changing how it was produced or how it operated for its whole production life, however in the mid 1920’s other auto makers in the industry started implementing the same production practice as the Ford Motor Company using the assembly line method and were making these cars more technologically advanced then the Ford Model T at the time, within the same price range. Due to these factors Henry Ford stopped production of the Model T and began re-designing his Ford model.