Henry Ford II Dies; Led Auto Firm 35 Years

Auto magnate Henry Ford II, who for 35 years ran the automobile company founded by his grandfather, managing it from the brink of disaster to the top rank of industrial power, died Tuesday in a Detroit hospital.

Ford, 70, who had a history of heart problems, was admitted to Cottage Hospital in suburban Grosse Pointe Farms on Sept. 9 for treatment of pneumonia he contracted while living at his country estate outside London.

He was transferred Sept. 12 to Henry Ford Hospital, the institution founded by his grandfather, where he was placed on a respirator in the intensive care unit. He received the last rites of the Roman Catholic Church on Sept. 18.

Family at Hospital

His wife, Kathleen DuRoss Ford; daughters, Charlotte Ford Downe and Anne Ford Scarborough, and son, Ford Motors executive Edsel Bryant Ford II, moved into the hospital to be with him, but doctors said he never fully regained consciousness.

He was an inheritor and he was a tycoon--representative of a family dynasty and living symbol of the modern industrial age.

His grandfather, the first Henry Ford, was already an industrial icon when Henry II was born.

The elder Ford was the man who had put America on wheels while turning the Ford Motor Co. into an industrial giant that was in its heyday unrivaled throughout the world. But that heyday was long past when young Henry took over in 1945.

Grandfather Henry had continued at the helm too long. He was senile, the company was on the brink of financial collapse and no one could have blamed the young man--who had only two years of junior executive experience behind him--for deciding the situation was hopeless.

“He could have opted out,” biographer Anton Walczak wrote in 1966. “No one would have been surprised if he had chosen to liquidate, cash in whatever assets remained for what they would bring in order to safeguard his family’s financial future without regarding the cost to others whose lives were bound up in the company.”

Instead, he set himself and those around him to modernize the company almost overnight. He reversed its fortunes in the first year of his stewardship while continuing to rule Ford like the family fiefdom it was. He returned the company almost to its original position of dominance.

“I had to,” he said. “My name is on the building. . . . “

Yet he remained an enigma--and a paradox.

- He was the liberal who spoke in behalf of social causes, led the revitalization of downtown Detroit and supported Democrats for President.

- He was the conservative who resigned from the board of the family-created Ford Foundation because he found it too liberal for his taste.

- He was the trend-setter whose Thunderbird, Falcon and Mustang were hailed.

- He was the trend-resister whose Edsel entered the language as a synonym for failure, whose Pinto was denounced as a murderous firetrap and who summed up his attitude toward compact cars in the single sentence: “Mini-cars mean mini-profits.”

- He was the dutiful scion who abandoned personal interests and ambitions to work 14-hour days in a threatening and unfamiliar milieu, mending the family fortunes.

- He was the international playboy who did as he liked, starring in the jet set gossip columns and making headlines as master of revels at famous watering holes in the Bahamas, Mexico and the Riviera.

“Never complain, never explain,” he said when questioned about a 1975 peccadillo.

It was, in many respects, his life theme.

Born Sept. 4, 1917, in Detroit, he was the eldest son of Edsel B. and Eleanor Clay Ford, and no one then or later ever doubted that he was the crown prince of the burgeoning Ford empire. But the years of his childhood coincided almost precisely with those of the company’s decline.

His father became president of the Ford Motor Co. in 1919. But it was a hollow title. Founder Henry Ford still held more than half the company stock in his own name, and no one else was allowed to make a decision--least of all the founder’s gentle and unassertive son.

At Yale University, where he was enrolled in 1936, he devoted more attention to such extracurricular activities as Zeta Psi fraternity, the Book and Snake Club and management of the Yale crew than to studies.

Henry II began college as an engineering student (a courtesy nod in the direction of his expected future role with Ford Motor Co.) but quickly switched to sociology and left without graduating in 1940 when a receipt carelessly left attached to his senior thesis when he turned it in betrayed the fact that it had been ghostwritten for him.

(In 1969, when he returned to Yale to speak, he looked up from his text and said with a grin: “I didn’t write this either.”)

By the time he left school, he had already been a director of the company for two years. But when he returned to Detroit, it was to take a job as a grease monkey at the River Rouge plant--and to make society page headlines with his marriage to Anne McDonnell.

At that time, he also embraced his bride’s Roman Catholic faith, a step for which he was prepared by Msgr. (later Bishop) Fulton J. Sheen.

He had just been promoted from the grease pit to the dynamometer room at the factory when he enlisted in the Navy.

Boot camp was followed almost immediately by assignment to Officer Candidate School, and in due course, he was commissioned an ensign and assigned to Great Lakes Naval Training Station as an instructor in mathematics.

What he really wanted, however, was to go to sea.

“I had joined the Navy because I wanted to sail on the ocean,” he said. “Sailing a desk was interesting but just not what I’d had in mind. So I kept badgering people with requests for sea duty, and an approval had finally come through--along with my promotion to lieutenant (jg)--when my father died, and everything was changed.”

Founder Henry Ford, then 80 years old, had resumed the company presidency on Edsel’s death, but the move was more of form than of substance, for he had never really relinquished control.

After the glory years in which he created the Model T and the production line that enabled him to manufacture it at a price within the means of average Americans--years in which he had astounded and infuriated competitors by paying his workers twice as much as anyone else in the field--the elder Henry Ford had turned destroyer.

He wrecked any attempt to modernize the industrial giant he had built and relied more and more on the advice and support of a Rasputin-like hoodlum named Harry Bennett, who presided over a secret police force set up to spy on the business and personal activities of everyone in the company from top executives to assembly line workers.

Between 1930 and 1941, Ford’s share of automotive output had declined from 40% of all American cars to less than 20%. The company had no true accounting system, no property books and no adequate research or design departments. During its entire 40-year history, there had never been an audit.

The wartime government, however, now relied upon Ford to produce thousands of airplanes and other weapons of war, and Navy Secretary Frank Knox realized that the elder Henry Ford--forgetful, unpredictable and suffering the aftereffects of two major strokes--simply could not remain in control if quotas were to be met.

So Henry II was discharged on Aug. 1, 1943, and the following year became executive vice president of the company--second only to his grandfather.

“But it wasn’t good enough,” a former Ford executive recalled, “and everyone knew it wasn’t. The old man could not remain in the driver’s seat. Young Henry wouldn’t stand for it, and he had the government on his side. Far more to the point, he also had his mother and grandmother. . . . “

Family members later confirmed that Eleanor Clay Ford--with the backing of Clara Bryant Ford--threatened to sell her sizable block of shares in the company, exposing it to possible hostile takeover, if Henry II were not made president and placed in full control.

The elder Henry Ford finally agreed, and on Sept. 21, 1945, his grandson became president and chief executive officer.

His first act was to fire Harry Bennett. His second was to get in touch with labor leader Walter Reuther, who later confessed that the contact was something of a surprise.

‘Ready to Deal’

“I thought it had to be a joke,” he said. “Somebody named Ford, ready to deal amicably with someone from the unions? Impossible! It’s a wonder I didn’t laugh in the man’s face and hang up the phone. But I didn’t. Thank God. . . !”

Reuther’s United Automobile Workers union was ready to strike, demanding a 30% wage increase as the price of its assistance in making the transition from wartime to peacetime production. Other car makers had decided to stonewall the unions, allowing their plants to be shut down in a test of strength they thought they could win.

Young Ford, however, invited Reuther and the other union officials to a get-acquainted meeting at which he and his new assistant, industrial relations expert John S. Bugas, suggested a resumption of collective bargaining. The offer was accepted, and talks resumed on Nov. 20--just one day before employees at General Motors walked off the job.

By Jan. 26, 1946, a new contract had been hammered out, one that gave the union a 15% raise and protected the company against “wildcat” walkouts that had proved crippling in the past.

Labor relations, however, were only one of the problems facing Ford and his company.

When he took office, the company was losing about $10 million a month, and that pace slackened only a little during the first half of 1946. The key to a turnaround, he was sure, lay in selecting new management for the firm.

Young Ford persuaded Ernest R. Breech, president of Bendix Aviation, to join the company. Breech had the management experience and expertise to implement Ford’s desire for a decentralized organization with a strong vertical executive structure and to aid him in establishing not only responsible department heads but a competent accounting system as well. A group of former Air Force officers called the “Whiz Kids” were brought in to apply military management techniques.

The group, which included (future Defense Secretary) Robert S. McNamara, Arjay Miller (who would become Ford board chairman) and Charles B. (Tex) Thornton (future head of Litton Industries) went to work with a gusto that showed immediate positive effects.

Despite the near-mortal financial hemorrhage of the first six months, the company’s fortunes recovered so readily that there was actually a profit--only $2,000, to be sure, but a considerable improvement on the $100-million loss that had been projected--in 1946.

Three years later, new Ford, Lincoln and Mercury models brought the company its best year since 1929, with more than a million cars sold and a profit of $177 million. Next year’s net soared to $256 million, and by 1953 Ford had once again moved past Chrysler to the No. 2 spot in the industry.

There were setbacks, however, and one of them bore an unfortunate name.

In the mid-1950s, the company decided to bring out a car for the medium-priced market, and Henry, seeking to honor the memory of a loved father, called it the Edsel.

The car came out in 1957 with first-year sales expected to hit the 200,000 range.

In fact, only 110,247 Edsels were ever actually produced, and the Edsel was discontinued in 1959 for a loss of $250 million.

Yet in the same year, another new Ford-built product called the Falcon--the first compact offered by any of the Big Three car makers--set a first-year record of 417,107 sales. In 1964, the company brought out the sporty Mustang, its first car aimed specifically at the youth market and sold 417,811 of them the first year.

The Mustang was largely the creation of Lee A. Iacocca, a previously obscure Ford vice president not yet 40 years old. The low-priced Maverick in 1969 and Pinto in 1970--both designed to meet competition from small foreign cars--were largely Iacocca’s as well.

Meanwhile, outside the auto industry, Ford was making himself highly visible as a man who often--and bluntly--spoke his mind on social, industrial and governmental problems.

In 1968, President Lyndon B. Johnson appointed him chairman of the National Alliance of Businessmen to direct a program involving cooperation between industry and government aimed at finding jobs for the hard-core unemployed. He resigned the post when Richard M. Nixon took office but later was appointed by Nixon to the chairmanship of the National Center for Voluntary Action.

As a trustee of the Ford Foundation, Henry Ford II supported most of its most widely debated actions, including aid to community organizing projects among the poor. But he resigned in 1977, leaving no family member on the board, and issued a statement criticizing the organization for “trying to do too many things in too many areas.”

It was to diversify the foundation’s holdings that Ford stock was finally sold publicly for the first time in 1956, and the grandson of the founder presided firmly and patiently thereafter over public stockholders meetings, explaining company policies and defending company decisions as the voice of a family that still had an easy working control of the firm.

The company’s executive suite remained a problem, however.

The company ran through six presidents between 1960 and 1980, and one of those who went--after just 19 months on the job--was Semon E. (Bunkie) Knudsen.

Ford’s explanation was terse: “Things just didn’t work out.”

Insiders saw it differently; they said Knudsen had been “set up” by Executive Vice President Iacocca.

And then, in October, 1978, it was Iacocca’s turn.

Asked by Iacocca for an explanation, Henry reportedly replied, “I just don’t like you.”

And that was that.

(Neither man suffered greatly. Knudsen became president of White Motor Co., and Iacocca became an industrial icon in his own right by plucking the Chrysler Corp. back from the brink of bankruptcy. On Tuesday, Iacocca issued a statement saying, “Henry Ford and I were friends and colleagues for a lot longer than we were adversaries, and my sympathy goes to his family and friends”).

Ford’s personal life also had its peaks and valleys. At a dinner party in Paris in 1960, he met Christina Vettore Austin, the divorced wife of a British naval officer who was described in print as “the most glamorous, sophisticated peasant in the world.”

Four years later, Henry’s marriage to Anne ended in divorce. He and Christina were married the following year, and he became the darling of the gossip columns, a two-fisted Scotch drinker who on at least one occasion led an entire Dixieland band into the swimming pool during a party at a private club.

Still, fun-loving Christina complained of his working habits. He seldom came home from the office before 7:30 p.m., she said, and liked to nap on weekends. When, after all, was she supposed to entertain?

She was out of the country in 1975--attending the coronation of the king of Nepal, it was said--when Henry was arrested in California for drunk driving. With him was Kathleen DuRoss, a widow and former model he had met during a party at his home.

“Never complain,” he said. “Never explain.”

And that was all, except for the 1980 divorce from Christina and marriage the same year to Kathleen DuRoss.

He had stepped down as chief executive of Ford Motor Co. in 1979--the year his brother Benson died--but delayed his departure from the chairmanship until March 13, 1980, the day the company was acquitted of criminal charges of reckless homicide in connection with the fiery deaths of three young women in a Pinto.

He remained a member of the board of directors and chairman of the firm’s finance committee, while younger brother William Clay Ford continued active as a vice chairman of the firm and watchdog of the family’s stake in it, and no one ever doubted his continuing interest.

But the years of effort had taken a toll.

Regained Health

He was hospitalized for treatment of angina in 1976. Medication and an exercise program helped restore his health. But thereafter, Ford spent more and more time away from the plant and traveling in Europe.

In the 1980s, he moved with his new wife to Palm Beach, although he retained a home in the Detroit suburb of Gross Pointe Farms and another in England. He made fewer and fewer public appearances, attended fewer parties and stopped making speeches.

“A hard man to know,” Knudsen had said.

“A man of power who tolerated no challenge,” Iacocca said.

But Henry Ford II said nothing.

He never did explain.

He never did complain.

And, in the end, his name was still on the building. . . .