On September 16, 1908, William Crapo Durant incorporated General Motors in Flint, Michigan, with 2,000 dollars of his own money. He was 46, a carriage maker from Flint who had built the largest wagon company in the country and who thought cars were noisy and unpleasant. He thought they would sell.
The industry in 1908 was a chaos of small workshops. There were more than 250 American car makers, most of them assembling bought-in parts, and nobody had capital, distribution or a steady supply of components. Durant was the one who saw that the answer was to own several makers at once, so that a buyer who could not afford a Buick could buy an Oldsmobile and one who wanted more could buy a Cadillac. He had Buick already, having run it since 1904. He added Oldsmobile, Oakland, which became Pontiac, and Cadillac within the first year, and he bought some two dozen companies, including parts makers and axle works, before anyone stopped him.
He did not know how to run what he had bought. The companies kept their own names, their own plants and their own engineering, and there was no central accounting and no common purchasing, so the combination saved less money than it cost to hold together. In 1910, with the car market tightening and his loans called, the banks took the company and put a committee in. Durant was out.
He came back by doing it again, more carefully, with Chevrolet as the lever and Louis Chevrolet's name on the car, and by 1916 he had traded Chevrolet stock for enough GM shares to be back in control. Then the same expansion happened again. By 1920 the postwar slump, his own borrowing and a collapsing share price put him out for good, and this time Pierre du Pont and Alfred Sloan took over for keeps.
What survived is the structure. Sloan gave the divisions price brackets rather than letting them compete with each other, set up annual model changes and a used-car trade-in value, and put the financial controls in that Durant had never bothered with. That is what let GM pass Ford in the 1920s. Durant died in 1947, running a bowling alley in Flint.