Legacy of The Deal

Published by The Bee News

May 31, 2022

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Have I got a Deal for you! That could easily have been the cornerstone for a successful marketing campaign. That could have become an even more popular slogan than “See the USA in yoour Chevrolet.” But, unfortunately, before marketing could commence in earnest, a company with tremendous potential closed its doors. There was little fanfare. And aside from the affect that the closure had on the small town in southern Michigan, few people even noticed.

The story begins at the dawning of the automotive age when a Duryea Motor Wagon, the first automobile manufactured in the United States for sale to the public, was given top billing over the “Albino” and “Dog Faced Boy” at Barnum & Bailey Circus. It was an era of incredible transition. But by 1900, for hundreds of carriage building companies, the future was increasingly looking bleak. And yet for companies with visionary leadership, it was also an era of unbridled opportunity.

Studebaker was a company that had survived almost fifty years by deftly adapting to changing times. The South Bend, Indiana based company was also one of the few that not only made the transition from carriages to automobiles, it was one of the only pioneering companies that became a leader in the auto industry.

The company’s origins were as a simple blacksmith shop. Then came the manufacture of wheelbarrows, shovel and pickax handles, and the reapir of wagons, in the California gold fields. By the mid-1880s this was one of the largest producers of wheeled vehicles in the world; prams, freight wagons, goat carts, surreys, coaches, gun carriages, and ambulances. Then, at the dawning of the 20th century, the company took a tentative step toward automobile manufacturing with the production of an electric car designed by Thomas Edison. That was the beginning of a new chapter for a company that would become an industry leader.

Jacob J. Deal emulated the Studebaker brothers when he launched his manufacturing empire. He established a blacksmith and wagon repair shop in Jonesville, Michigan in 1858. Then in 1865, with a workforce of just twelve men, he began manufacturing wagons, buggies, carriages, and sleighs. By 1890, Deal was turning out hundreds of horse drawn vehicles each year.

For the company’s owner and the board of directors, the automobile represented new opportunity. Shortly after the turn of the century the company diversified and was a major supplier of commercial van bodies for fledgling automobile manufacturers in nearby Jackson, Albion, and Hillsdale.

Still, by 1908, even a company as successful as Deal could no longer ignore the dominance of the automobile. And so, once again the company was reorganized and diversified to include automobile manufacturing. By all accounts, the automobiles the company produced was as quality a product as the carriages and wagons that had rolled from the factory for decades. Still, it proved to be a short-lived endeavor and the company abandoned automobile production, returned to the manufacture of wagons, and then with little fanfare closed its doors in 1915.

Another company that attempted to make the transition was the McFarlan Wagon Manufacturing Company of Connersville, Indiana that was established in 1856. As with Deal, the company prospered, expanded, and by the late 19th century was a leading manufacturing of horse drawn transportation. But unlike Deal, McFarlan successfully made the transition from wagon manufacturer to the manufacturer of luxurious automobiles that became an industry standard in the teens.

A key to the company’s transition was the vision displayed by the owners in 1886 when they established a modern industrial park. The McFarlan park provided immediate access to the railroad and cheap energy as McFarlan also owned a natural gas company. By leasing property to manufacturers and suppliers of carriage and buggy equipment, and furniture companies, McFarlan was able to lower their production costs. In the early 20th century the park would be dominated by the manufacturers of automotive components, and this too would work in McFarlan’s favor.

In June 1909, there was a simple, short announcement in a trade journal, “The McFarlan Carriage Company of Connersville, Indiana has announced that they will soon begin manufacturing a motor buggy.” Outdated businiess practices doomed the company. Just as Henry Ford was on the cusp on launching mass production to lower the cost of each vehicle, McFarlan chose to manufacture two hundred vehicles per year for the “discriminating buyer.” As a result, from its inception the company began pricing themselves out of the market. The first models had a factory list price of $2,000 (a Ford was $850) but by 1918 prices were surpassing $5,000 when a nice home could be purchased for $2,500.

During the teens the three “P” s – Packard, Pierce Arrow and Peerless – dominated the luxury car market, but McFarlan was in a league all its own. Before the company closed its doors in 1928, the company had established a reputation for the limited production of huge luxury cars with ostentatious body work that appealed to movie star, gangsters, and oil men. The list of owners included boxer Jack Dempsey and Virginia governor E. Lee Trinkle. Al Capone bought a McFarlan for his wife, Mae, in 1924 and bought a second one in 1926 for his use.

As an example of the companies over the top luxury appointments, in 1922 a special model was built for display at the Chicago Automobile Show. Standard models made extensive use of nickel plating. On the display car this was replaced with 24 carat gold! It was purchased by a wealthy Oklahoma oil tycoon as a gift for his wife for the princely sum of $25,000.

Initially the company used engines produced by a variety of companies including Buda, Continental, and Brownell. For the line of commercial cars developed in 1920, the company would continue its association with Continental but in the cars built for the discriminating buyer the engines were produced by McFarlan. This included the monstrous 573-c.i.d Twin Valve Six with triple ignition and three sparkplugs per cylinder that was rated at 120-horsepower. Quirky options, often trouble prone, were also a part of the cars appeal. These included vacuum assist starting, heated steering wheel, front and rear heating, and self-lubricating chassis.

By 1922, the company’s best year with production of 235 vehicles, the proverbial handwriting was on the wall. The post WWI recession had crippled a number of auto manufacturers and a company such as McFarlan was in no position to compete. They were still using the antiquated T head engine and technologies that were at least a decade behind the competition. Even worse, their prices now ranged from $6,300 to $9,000.

By contracting with Lycoming, the cars were updated mechanically but the styling was increasingly dated and ever more luxurious interiors, and gadgets, were not enough to maintain even mediocre sales. Then in 1924, Harry McFarlan fell ill and turned over management of the company to Burton Barrows. The final blows came in 1928. Both McFarlan and Barrows died within weeks of each other. And this was shortly after the company was forced into receivership.

The final chapter in the McFarlan story was written by E.L. Cord, the swashbuckling entrepreneur behind the Auburn/Cord/Duesenberg empire. In 1926 Cord began building his automotive empire by trading Auburn stock for a controlling interest in Duesenberg. The following year he gained control of the Lycoming Engine Company of Pennsylvania and bought major auto plants in the McFarlan industrial park, the Lexington Automobile Company and the Ansted Engine Works. Then in 1928 he acquired the Central Manufacturing Company followed a few months later by the acquisition of McFarland. He then consolidated the factories and transformed 82 acres of the park into a manufacturing complex for Auburn.

By 1930 McFarlan was on the fast track to becoming an historic footnote. With no resale value as a used car, McFarlan’s were relegated to the back of car lots, to salvage yards and were converted to trucks. Survivors were consumed by the scrap drives during WWII. Today only nineteen cars are known to exist, and they seldom change hands. Each is a tangible link to a bygone era, a time when an automobile company could cater almost exclusively to the rich and famous, and turn a profit.

Written by Jim Hinckley of Jim Hinckley’s America 

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