The EVC wasn’t slow to put its grand plan into effect. Hartford was soon working on orders for thousands of electric vehicles and the company was expanding abroad.
To satisfy demand in Paris, the EVC built a charging station at 54 Avenue Montaigne, in the centre of the city, and acquired land for a second near the Arc de Triomphe. In March 1901, The Automobile Review reported how this second station would be capable of handling 150 carriages, as well as charging and conditioning hundreds of batteries. The cars were all privately owned, their drivers paid a fee for accommodation and maintenance.
In London, the company’s agents were doing good business selling a range of vehicles to wealthy clients and even royalty. Hartford and Elizabethport built the running gear, while the bodies were sourced locally.
Back home in America, wealthy industrialists, socialites and politicians had taken the Columbia cars to their hearts. Indeed, when President Roosevelt took part in the first US presidential motorcade, in August 1902, he did so in an open Columbia Electric Victoria Phaeton. The President sat up front, accompanied by chairman Jacob L. Greene, with the nervous driver and a fellow footman perched behind them. The close protection security detail was provided by four policemen mounted on Columbia pedal cycles.
The cab business seemed to be doing well, too. As The Horseless Age commented:
Many aristocratic people have become partial to the motorcabs and employ them altogether for business and social routine. Some of them are so enthusiastic that they declare they will not bring their horses to the city for another winter, but will leave them at their country places.
Despite the outward appearance of success, the EVC was in trouble. The taxi fleets were proving troublesome with a high rate of battery failures contributing to higher than expected running costs. They were also coming under pressure from gasoline-powered competitors that could run for hours, in marked contrast to the electric cabs, which needed regular battery swap outs at a convenient station.
The first hint of difficulty came in 1900 when the company was forced to seek a capital injection to keep the business afloat. Shareholders, who had received an 8 per cent dividend the previous year and believed the business was in rude health, were shocked by the sudden reversal of fortunes. Nevertheless, the company was able to raise a significant amount of money via the syndicate’s own State Trust Company.
As time went on it became more and more obvious that electric vehicles had been nothing more than an interesting development in the transition from horse-drawn carriages to cars powered by internal combustion engines. Even supporters of electric vehicles were forced to concede that their drawbacks would limit them to work in towns and cities, leaving longer out-of-town trips to the gasoline-powered competition. It looked as though the game was up. However, the EVC had one last ace card up its sleeve.
George Selden was a patent lawyer and a keen amateur inventor. During the day he worked for his father’s legal firm, by night he disappeared into his basement workshop where he spent hours tinkering. Inspired by George Brayton’s internal combustion engine, which was one of the major exhibits at the Philadelphia Centennial Exposition in 1876, Selden attempted to design a smaller, lighter and more reliable version. On 8 May 1879, he filed a patent application for not only the engine, but the idea of using an engine in a car. It wasn’t until 5 November 1895, that the 17-year patent was finally granted but, when it was, the decision added legitimacy to Selden’s claim to having invented the motor car.
The delay in issuance, which was largely Selden’s own doing, was important because it gave the fledgling motor industry time to catch up with Selden’s ideas. By the time the patent was granted, cars were being built by small manufacturers throughout the United States and Selden believed he could demand a royalty payment on every one that used an internal combustion engine.
The Selden patent, which ran for 17 years, was a cause of some concern to Herman F. Cuntz, the engineer in charge of the patent department at the Pope Manufacturing Company. He warned management that its gasoline-powered vehicles, developed alongside the company’s range of electrics, could be in violation of the patent. However, Cuntz’s fears were largely ignored until 1899 when Whitney arrived to discuss the terms of a merger. According to Cuntz, as the talks began to wind up Whitney asked if there were any outstanding patents that might cause trouble for the soon-to-be enlarged EVC, whereupon Cuntz produced a three-page list, which included details of the Selden patent.
However, Hiram Maxim, the brilliant inventor and engineer who was in charge of Pope’s motor vehicle division, always maintained that his research into internal combustion engines led directly to the company taking an interest in the patent. Whichever story one chooses to believe, in late 1899 the EVC bought Selden’s patent for a cash payment, a promised share of the royalties and a minimum payment of $5,000 a year. Whitney swooped when he heard that five other Wall Street speculators were planning to offer Selden $250,000 for the rights to his patent.
When the EVC ran into financial difficulties, Whitney dusted down the patent and used it as a legislative weapon against gasoline-powered rivals. The Horseless Age magazine, which never had a good word to write about the EVC, which it dubbed the ‘Lead Cab Trust’ due to Whitney’s control of the Electric Storage Battery Company, condemned the move as ‘grotesque’. In a damning editorial the magazine’s editor wrote: ‘If they have any saving sense of honour they will retire and leave the field to the mechanics and manufacturers to whom it rightfully belongs’. As John B. Rae, associate professor of history at the Massachusetts Institute of Technology, wrote in his paper on the EVC (‘The Electric Vehicle Company: A Monopoly That Missed’), ‘the EVC combine did not intend to enter the gasoline automobile field, but if it could levy a toll on all those who did produce such cars, then it stood to gain regardless of which type of automobile won out’.
The consortium wasted no time in flexing its new legal muscles. In 1900, the EVC filed a lawsuit against the Winton Motor Carriage Company and the Buffalo Gasoline Motor Company in the US District Court. The choice of ‘victims’ was no accident. Founded in 1896 by Scotsman Alexander Winton, the Winton Motor Carriage Company was by 1900 the largest automobile manufacturer in America.
The Buffalo Gasoline Motor Company was a major manufacturer of engines for marine, industrial and commercial applications. In a particularly mean-spirited move, the EVC also sued two firms chosen for their inability to fight back because they were little more than hobbyist ventures. It also sued a New York company, Smith and Mabley, which imported cars from Europe. By doing so the consortium had covered all bases.
Although both defendants resisted, by 1902 Winton’s funds were running low and, having lost the first round, the company sued for peace. At the same time, the Manufacturers Mutual Association (MMA), a group of independent motor manufacturers that had banded together in a bid to ameliorate the threat of the Selden patent, opened negotiations. In March 1903, Winton and Buffalo Gasoline caved in and accepted the validity of the Selden patent.
Winton became a member of the newly named Association of Licensed Automobile Manufacturers (ALAM), along with more than twenty other motor companies, and duly paid a discounted royalty on all its cars. Among the companies that coughed up were Packard, Cadillac, Oldsmobile, Peerless and Knox.
The ALAM and the EVC came to a cosy agreement. The EVC would collect the royalties and would pay two-fifths to the ALAM, one-fifth to Selden and keep the rest for itself. Any motor manufacturer wanting a Selden license, and a favourable royalty payment system, had to become a member of the ALAM. However, the group’s high-handed attitude towards potential new members would prove to be its undoing.
In February 1903, Henry Ford applied for a license and membership. He was turned down flat. Ford tried again in the summer, around the same time as the Ford Motor Company was incorporated, but the result was the same. The official reason was that because Henry bought in components, his company was merely an assembler and not a true manufacturer. Ford’s earlier ill-fated car companies were also cited as reasons for his unsuitability and questions were asked of his ability to meet the association’s lofty manufacturing standards.
The reasons were obviously spurious: almost every member of the ALAM used component suppliers in much the same way as Ford. The more likely explanation for the rejection is that Ford’s plan to build an affordable automobile had his rivals running scared, particularly Frederick L. Smith, the ALAM’s president, who was also secretary-treasurer of the Olds Company which was firmly in Ford’s sights.
The decision to blackball Ford would prove to be an enormous mistake. The ALAM seized the initiative, taking out newspaper advertisements hailing its members as the true pioneers of the automobile and promising to prosecute anyone manufacturing, selling or even buying an unlicensed automobile. A lawsuit was filed on 22 October 1903, but, unlike Winton Motor, Ford had the resources to put up a fight. In the face of the association’s aggressive advertising, Henry replied with a series of ads that promised to indemnify sales agents and buyers against prosecution for patent infringement – a guarantee backed by the company’s $12m assets. In his biography, written in 1922, Ford claimed fewer than fifty buyers took him up on his offer.
Taking a leaf out of the ALAM’s book the ads weren’t afraid to bend the truth, hailing Ford as a true pioneer and the first man to make a car in Detroit and only the third in the United States. Ford rejected the patent as ‘a freak among alleged inventions’. He also enjoyed widespread public support. Many car buyers believed, correctly, that the patent fee was being passed on to them via higher prices and could see no reason why they should fund the EVC.
Ford became the bulwark with which other independent auto-makers resisted the ALAM and the EVC. In 1905, Ford and nineteen other car companies formed the American Motor Car Manufacturers’ Association (AMCA) to defend the ALAM’s litigious actions. The case dragged on for years. In 1907, the two opposing forces even built their own automobiles. The ALAM created a vehicle designed to the Selden patent to demonstrate that such a machine was viable. The defendants produced a similar machine with an engine designed to specifications patented by a French inventor in 1860 to show that the patent was spurious. Finally, after six years of argument, on 15 September 1909, presiding Judge Hon. C. M. Hough sided with Selden.
Summing up, the judge said:
Patents are granted for inventions. The inventor may use his discovery, or he may not, but no one else can use it for 17 years. That 17 years begins whenever the United States so decrees by its patent grant.
Avoiding for the present the language of his original application, and the effect of the numerous changes therein during its many years in the Patent Office, was the thing fairly revealed by the model and drawings, and conceived under the circumstances above set forth,–the embodiment of a combination patentable in 1879? I think the answer is emphatically, yes.
Discussing Selden’s invention, the judge added:
[Mr Selden] does assert that he selected, adapted, modified, co-ordinated and organized the enumerated parts (including the usual mechanical adjuncts of each part) into a harmonious whole capable of results never before achieved, and of an importance best measured by the asserted fact, that after 30 years no gasoline motor car has been produced that does not depend for success on a selection and organization of parts, identical with or equivalent to that made by him in 1879.
If I have correctly apprehended it, there was clearly room for a pioneer patent, and it must now be held that on its face and in view of the art, Selden’s is such a patent. This means that Selden is entitled to a broad range of equivalents, and this rule as applied here results in this crucial inquiry: was Selden (or anyone else) entitled in 1879 to appropriate as one of the elements of any patentable combination a liquid hydro-carbon gas engine of the compression type? I think he was, and so was any other inventor, but he was the first so to do.
Undaunted, Ford announced an immediate appeal but his determination to fight on was not shared by many of his AMCA partners. Within weeks, eight of them had signed deals with the ALAM. Five months later, the AMCA folded but Ford fought on alone. The Detroit Free Press labelled him ‘Ford the fighter’.
Everything changed on 9 January 1911, when the appeal court handed down its decision: overturning the original judgement and handing Ford a stunning victory. Ironically, the battle had taken so long that Selden’s patent only had one more year to run.
As for the Electric Vehicle Company, it didn’t survive long enough to enjoy either the victory or suffer the ultimate agony of defeat. The financial panic of 1907, and the failure of its electric cab scheme, which more than swallowed up any income it received from royalties, saw both the EVC and the Pope Manufacturing Company collapse.
The company had been living on borrowed time for several years. When Selden royalties failed to generate the bountiful income stream that had been anticipated (its best year was 1906 when income from the patent was $217,683.66), the EVC was a busted flush. When it threw in the towel, the company had cash assets of just $12,000.
The patent passed to the Columbia Motor Car Company, of Hartford, which went into receivership in 1912 after an ill-judged merger with the Maxwell–Briscoe Motor Company.
History has not treated the EVC sympathetically.
Author and historian Allan Nevins, who wrote a critically acclaimed biography of Henry Ford, condemned the Selden patent battle as the work of businessmen who had backed the wrong technology and tried to hold back the competition by litigation. Historian John Rae was even more scathing. The EVC, he said, was a ‘parasitical growth on the automobile industry, and its demise was regretted only by those unfortunate enough to hold its securities’.
Whatever the truth, when the EVC collapsed, any hopes of electric cars winning a large share of the emerging car market went with it. However, although the EVC had been the boldest electric vehicle company, it was far from the only one. At the turn of the century, dozens of small manufacturers were churning out electric cars and some were working on innovative ways of overcoming the problems associated with primitive batteries – the world’s first hybrid vehicles.