History of Industry

Whether you’ve traveled to an unfamiliar place or just needed a replacement while your car’s in the shop, chances are you’ve had to rent a car at some point in your life. Rental cars have a long and storied history that’s closely tied to the history of the automobile industry and America itself. As times have changed, so have rental cars – and they remain a crucial part of the automobile industry to this day.

The true beginnings of rental cars are unknown, but many believe that the first true rental car agency began with the Model T, the first mass-produced automobile. Allegedly, the first rental agency belonged to a Nebraskan man named Joe Saunders, who would rent his Model T out for ten cents a mile. Saunders used a mileage meter to determine how far his car had been driven. The legend goes that Saunders’ first rental went to a traveling salesman who wanted to impress a girl on a date.

Whatever the case, Saunders definitely had the first massively successful car-rental agency. By 1925, his business had rental agencies in 21 states. However, the Great Depression led to many people no longer needing rental cars, and Saunders went bankrupt.

While Saunders was establishing his business, a man named Walter Jacobs was also starting his own Model T rental service. Jacobs fared far better than Saunders. He eventually sold his business to Yellow Cab owner John Hertz. Hertz’ company was then bought out by General Motors. Today, Hertz Rent a Car is the largest rental car company in the world.

Rental cars suffered from a bad reputation during the Prohibition period, as many believed they were used to transport criminals. After Prohibition was repealed, the rental car industry enjoyed a better reputation, and expanded considerably.

The industry grew even more after WWII, because the growing popularity of airlines for business travel meant that more people needed a car for their business trips. Hertz had predicted this trend by opening a rental facility at Chicago’s Midway Airport in 1932. Avis is credited with being the first company to do airport-focused rentals as its main source of business. The company’s founder, Warren Avis, was a former Army pilot, and focused almost all their business toward airports and the surrounding areas. Another successful company launched during this time was National Car Rental System, Inc., whose founders included Joe Saunders himself.

In the 1970s and 1980s, rental car companies began selling off their older vehicles, which led to companies such as Hertz also becoming major used-car dealers. At this point, major automobile manufacturing companies began buying up many used car companies in an effort to ensure that these companies would primarily buy their cars from them.

Importance of crude came into dominance only in the 20th century wherein a wide number of jobs in a more civilized world became dependent on oil. History of crude has followed places where it has been discovered and resulted in changing the economic paradigm of these regions forever.

It was first in the mid 19th century when in the region of Pennsylvania crude was discovered for the first time. It was during this time the marketing pundits of that era began speculating on how big this discovery could mean to mankind. On the other hand there was also a school of thought which not gave much importance to it. As a result of these two opposite point of views the prices of crude began to swing up and down. Many of you would be surprised to know that way back in January 1861 soon after crude had been discovered it was being sold at $ 10 a barrel. Within no time crude had the honour of becoming the most precious commodity of that time. Beyond belief for many in less than 12 months time crude was selling at 10 cents per barrel. It would be fair to comment here that Crude was born with volatility as its second name and always had powers to make or break fortunes for business community.

Crude would have only gained importance as it has today if we would have solved the code to transport it. In the earlier days barrels made of oak wood were used to transport this fuel. As at times crude prices would become so low that cost of oak barrels would be often more than that of oil inside them. By 1866 pipelines made from wood carved out and used to transport oil to the rail tanks. The rail tanks would transport oil to nearest refinery which came up in Cleveland, Ohio.

Further discoveries of oil were scattered in the region and had requirement to be transported from the oil fields to the refinery. Soon few business men got associated with the logistics part of it. Further to their liking they realized key to success in the oil business was logistics as it directly had major impact of the costs. A network of pipelines and rail wagons were developed in their region making it relatively easier to transport oil from the oil fields to the refinery. Cleveland developed as a major oil refining hub in the region.

People who had most of the influence over oil were now the businessmen involved in logistics. Once such establishment, ‘Standard Oil Company’ rose from being a logistical service provider to controlling almost 80% of American Oil business. Three incidents in early part of 20th century also led to major historical changes in crude industry, they were:

1. Texas Oil (Texaco) came into picture in 1901 and eventually became a big player along with ‘Gulf’.
2. Anti-trust legislation was used by United States government to break up Standard Oil Company in 1911.
3. World war in 1914 highlighted the importance of crude as it become vital for winning wars.

Hope above has provided you with a brief on historical perspective of crude oil.