case study-ford s rubber plantation

8/13/2019 Case Study-Ford s Rubber Plantation

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D.C.Singhal Page 1 of 15

Fords Project of Rubber Plantation

Abstract

The rubber plantations of Fordlandia and Belterra were two attempts by the

Ford Motor Company from 1928-1945 to establish a permanent rubber

plantation in Brail! The "oal was two-fold #i$ to supply Ford%s internal

demand for rubber and #ii$ to pro&ide a better way of life for the Brailians

who li&ed and wor'ed on the plantations! The pro(e)t was mar'ed with

failures su)h as not understandin" nati&e )ulture and tryin" to impose a

*earborn-li'e wor' s)hedule and life style on the nati&e Brailians as well

as an inability to pre&ent predator atta)' on plantations parti)ularly leaf

bli"ht!

Introduction

Rubber has been a strategic material. It has many uses particularly for

vehicle tyres. Prior to World War 2, the only source of rubber was natural

rubber. Subsequently, synthetic rubber was developed and began to be

produced commercially. In 2005 about 21 million tons of rubber was

produced, of which approximately 42% was natural.

Natural Rubber

The rubber tree Hevea Brasiliensis is native of Brazil where it grows

naturally. It is mainly found within 10 N&S of the Equator. South America

was the main source of the limited amounts of rubber used during much of

the 19th century. In the latter half of the 19th century through to the second

decade of the20th century natural rubber supported one of the mostimportant development boomsin Brazil. The acquisition of rubber was lie

the !old "ush in the #$%. Thousands of immigrants flowed in to tap the

late& and turn it into rubber. The euphoria lasted through to 1910' when


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sulfurand other additives and then applying heat and pressure. This

improved its resistance and elasticity and prevented it from perishing. It

gave rubber great versatility and utility. (However, to recycle vulcanized

rubber, suitable process to devulcanize needs to be developed)

Project Decision

In the early 20th century, a cartel of Dutch and English rubber barons had a

stranglehold on the vast majority of the world's supply of rubber from the far

east plantations. By the late 1920s, Henry Ford set out to break this rubber

monopoly. His hundreds of thousands of new cars needed millions of tires,

which were very expensive to produce when buying raw materials from the

established rubber lords. He established a project in the Amazon rain forest

in Brazil to create the largest rubber plantation in the world.

Ford had a vision to lay a perfect American town in his Brazilian plantation.

He also wanted to transplant a Dearborn type lifestyle and work culture to

the plantation town. This social engineering was much resented by the

local workers.

If all went well, Ford would have both: a direct pipeline of coveted rubber to

Detroit and a utopia full of healthy, productive workers. But this enormously

ambitious project was ultimately a great failure as described in succeeding

sections.

Project Location

Henry Ford was influenced by a 1923 United States government survey

that named the Amazon as an ideal location for producing rubber. Ford had

also been contacted by Brazilian officials as early as 1923 with a view to

bring the rubber industry back to Brazil. After preliminary investigations,


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Ford started his venture in Brazil in 1927 by founding a company named

Companhia Ford Industrial do Brazil in Belem, the capital of the state of

Para in Brazil.

In the project, corruption also seemed to have played a role. The interests

of local businessmen and even the governor of Para were often carried out

personally, not without any influence on the decision. This led to the

unexpected costs for bribes. Further, the cooperation of Ford with

Brazilian authorities was all but easy. Customs officers often refused to

actually enforce the tax concessions granted because Ford resisted to pay

bribes, though there was also confusion over federal versus regional

competences.

Brazil seemed the ideal choice considering that the rubber trees were

native to the region, and the rubber harvest could be shipped to the tire

factories in the US not only by sea but by land as well. In July 1927 Ford

was granted 10,000 square kilometer tract of land along the Tapajoz River.

The region had good soil for cultivation and rainfall was adequate. A

problem seen was the scarcity of labour which could be addressed by

constructing housing and other facilities for the workers (and attractivepay). The project was to produce enough rubber to make tires for

2,000,000 automobiles a year. In 1925 Ford Model-T accounted for 37% of

all the cars running in the planet.Also,Brazil hoped that by this project

Ford could bring the rubber industry back to Brazil.

Due to his intense dislike for experts [and accountants], Ford never

consulted any expert on rubber cultivation. He just sent a bunch of supplies

and managers into the jungle hoping to grow rubber. He could have saveda lot of money if he just hired a consultant to tell him that the land wasn't

very fertile and wasn't suitable for rubber plantation. But the main problem

was the South American leaf blight and insects that existed in the location


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and attacked the trees when packed close together in a commercial

plantation.

Due to his dislike for experts, and his philosophy of training on the job,Ford appointed Einar Oxholm (the captain of the ship carrying the original

equipment but a man without any experience on plantation) as the first

manager of the plantation. The results were disastrous. The plantation

changed hands several times before Archibald Johnston took over in 1931.

In 1933 for the first time a rubber planting expert, James weir, was hired.

Project Implementation

Ford had negotiated with the Brazilian government into granting him 10,000

square kilometers of land in the Amazon rainforest along the Tapajos River

(a major tributary of Amazon River)in exchange for a nine-percent cut of

the plantation's profits. He immediately began to develop the area to

establish a town which was named Fordlndia. A steamer arrived with

earth-moving equipment, a pile driver, tractors, stump pullers, a locomotive,

ice-making machines, and prefabricated buildings. Workers began erecting

a rubber processing plant as the surrounding area was razed of vegetation.

The lumber from trees cut was hauled to the saw mill. Though initially it

was calculated that that tropical lumber will bear a part of the cost, there

was no market for lumber from Fordlndia due to high costs.

Many Ford employees were relocated to the site, and over the first few

months an American community sprung up from what was once a jungle

wilderness. It included a power plant, a modern hospital, a library, a golf

course, a hotel, and rows of white clapboard houses with wicker patio

furniture (patio = outdoor space adjoining a house usually paved). As the

town's population grew, all types of businesses followed, including tailors,

shops, bakeries, butcher shops, restaurants, and shoemakers. It grew into


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a thriving community with Model T Fords frequenting the neatly paved

streets.

Beyond of the residential area, long rows of freshly-planted saplingssoondotted the landscape. Ford chose not to employ any botanistsin the

development of Fordlndia's rubber tree fields, instead he relied on the

company engineers. The engineers planted about two hundred trees per

acre despite the fact that there were only about seven wild rubber trees per

acre in the Amazon jungle. The plantations of East Asia were packedwith

flourishing trees, so it seemed reasonable to assume that the trees' native

land would be just as accommodating.

Cultural Clash

(ordl*ndia attracted a large numbers of worers. +ocal laborers were

offered a wage of thirty,seven cents a day to wor on the fields' which was

about double the normal rate for that line of wor. But (ord-s effort to

transplant %merica,, what he called the healthy lifestyle,, was not limited

to %merican buildings' but also included mandatory %merican lifestyle and

values. The plantation-s cafeterias were self,serve' which was not the local

custom' and they provided only %merican food such as hamburgers.

/orers had to live in %merican,style houses' and they were each

assigned a number which they had to wear on a badge. Brazilian laborers

were also required to attend %merican festivitieson weeends' such as

poetry readings' square,dancing' and )nglish,language sing,alongs. %

arring cultural difference was enry (ord-s prohibition. %lcoholwas strictly

forbidden inside (ordl*ndia' even within the worers- homes' on pain ofimmediate termination. rohibition was not the law in Brazil.

/orers- discontent grew as the unproductive months passed. Brazilian

worers,, accustomed to woring before sunriseand after sunset to avoid

the heatof the day,, were forced to wor proper %merican nine,to,five


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shiftsunder the hot %mazon sun' using (ord-s assembly,line philosophies.

%nd malariabecame a serious problem due to the hilly terrain-s tendency to

pool water' providing the perfect breeding ground for mosquitoes.

3n 4ecember of 1950' after about a year of woring in a harsh environment

with a strict and disagreeable healthy lifestyle' the laborers- agitation

became critical in the worers- cafeteria. aving suffered too many

episodes of indigestion and degradation' a Brazilian man stood and

shouted that he would no longer tolerate the conditions. % chorus of voices

oined his' and the discord was soon oined by sounds of banging cups and

shattering dishes.%merican managers fled swiftlyto their homes or into the

woods' some of them chased by machete,wielding worers. % group of

managers scrambled to the docs and boarded the boats there' which they

moved to the center of the river and out of reach of the escalating riots.

6machete 7 nife or a&e8

The Brazilian military arrived three days later' and by that time the rioters

had e&pended most of their anger. /indows were broen and trucs were

overturned' but (ordl*ndia survived. /or resumed shortly. But the rubber

situation had not improved.

The Plantation

/hile the community struggled along month,to,month with its disgruntled

worforce' it was also faced with a maor dilemma. The tiny saplings

weren-t growingat all. eavy %mazon rains in the hilly terrain hemorrhaged

its topsoil' leaving infertile' rocy soil behind. Those trees which were able

to survive into adolescence were soon stricen with a leaf blightthat ate

away the leaves and left the trees stunted and useless. (ord-s managers

battled the fungus heroically' but they were not armed with the necessary

nowledgeof horticulture' and their efforts proved futile.


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3n 1955' after three years with no appreciable progress to show for the

investment' enry (ord finally hired a plant pathologist' 4r. ames /eir'to

assess the situation. The /eir tried to coa& some fertile rubber trees from

the pitiful soil' but he was ultimately forced to conclude that the land wassimply unequal to the tas. The damp' hilly terrain was terrible for the trees'

but e&cellent for the blight.

Shift of location

:ot deterred by initial failure' (ord made a second attempt in 1955. e

acquired a new tract of land eighty miles downstream from (ordlandia near

the mouth of the Tapaoz' establishing the town of Belterra ;though(ordl*ndia was not entirely abandoned but reduced to an . To acquire the new location' the most

remote part of the original concession was e&changed for the equal,sized

land. Belterra ; was more flat and less damp' maing it

much more suitable for the rubber trees. ?learing at Belterra started early

in 195@ and (ord adapted housing and recreation to the Brazilian way of

life' which reduced construction costs and social tension. (ord also

imported some grafts from the )ast %sian plantations' where the trees had

been bred for resistance to the leaf blight. The new enterprise showed

more promise than its predecessor' but progress was slow. By 19@0' A00

employees were woring at (ordlandia while 2'A00 employees were

woring at Belterra.

/eir ;who was a plant pathologist> put much more emphasize on research

which was not considered as an issue earlier. )mphasis was put on theselection of trees with respect to their performance. /eir founded a

research laboratory and nursery at Belterra to e&periment with producing

high,yielding and disease,resistant strains of rubber. By a combination of

grafting methods' three sources of


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comprising a root resistant against root diseases' a high yielding stem' and

a foliage resistant against leaf disease.

(or ten years (ord-s worers labored to transform soil into rubber. By 19@1'there were 5'A1'A00 rubber trees planted at (ordlandia and Belterra. 3n

19@2' the first commercial tappingof the rubber trees began yielding an

output of CA0tons of late& D far short of that year-s goal of 5E'000tons that

(ord needed annually. 3t was estimated that by 19A0 the two plantations

would produce that amount of rubber. owever' the new location was still

plagued with leaf fungus problems and technicians tried to contain the

epidemic through bud grafting.

Project Abandonment

(ord-s perseverance might have eventually paid offif it were not for the fact

that scientists developed economical synthetic rubberust as his Brazilian

plantation was establishing itself. %lso as /orld /ar 33 ended' the (ar

)astern rubber plantations were reopened ;which had been invaded by the

apanese in 19@1>. ence (ord saw no need to eep the Brazilianplantations open. 3n 19@A' enry (ord retired from the rubbering trade'

having lost the total investment of over F20 millionin Brazil without ever

having set foot there. % company press release announced the

abandonment of (ordl*ndia and Belterra with a bland epitaphG Hur war

e&perience has taught us that synthetic rubber is superiorto natural rubber

for certain of our products. The (ord Iotor ?ompany sold the land bac to

the Brazilian government for F2A0'000,, a toen sum. This was the amount

(ord owed his worers under Brazilian law as severance pay.

(ord-s losses in (ordl*ndia and Belterra are equivalent to F200 million in

modern ;2015> dollars.(ord was unable to buyhis way into rubber royalty'

and his efforts to spread his %merican healthy lifestyle met with


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resentment and hostility... but history has repeatedly shown that obscene

wealth permits bizarre and astonishing mistaes on a grand scale as

(ordl*ndia proved.

The Lessons

/hy did the proect failJ

(ordKs vision for his new enterprise was conceived with a strictly

%merican perspective. e never considered the cultural differences

between %merican and Brazilian worers.

3nadequate initial studies. (ord didnKt consult with botaniststo determine

the colonyKs agricultural viability.

e installed %merican managers who new nothing about growing rubber

or about social engineering. Ianaging the plantation was a ob of

horticulturists and not (ord factory trained men.

3n the 1C years that (ordlandia and Belterra struggled to survive' enry

(ord never once visitedthe site.

%ll of this resulted in a multi,million dollar investment that failed. :o (ord

car rolled off the assembly line with (ordlandia-s rubber in it. The proect

was scrapped in 4ecember 19@A.

The plantation was slowly enveloped by the ungle.The ruins of (ordlandia

are now a stop on the %mazon rain forest tour. They are a graphic reminder

of an epic e&periment that was doomed from the start.

References

1 Fordlandia! The Rise and Fall of "enr# Ford$s For%otten &un%le

Cit#'by !reg !randin' :ew LorG Ietropolitan Boos' 2009.


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( The Ruins of Fordlandia'%rticle M 20C by %lan Bellows.

http://www.a!ninte"e#ting.$o!/the%"&in#%of%fo"lania/

) Ford *otor Compan#$s +ra,ilian Rubber Plantations' Benson (ord

"esearch ?entre' opular "esearch Topics.http://www.thehen"'fo".o"g/"e#ea"$h/"&((e"Plantation#.a#p)

Iap of the %mazon Basin with Tapaois "iver highlighted
http://www.damninteresting.com/the-ruins-of-fordlandia/http://www.thehenryford.org/research/rubberPlantations.aspx%20%20%20%0D3http://www.damninteresting.com/the-ruins-of-fordlandia/http://www.thehenryford.org/research/rubberPlantations.aspx%20%20%20%0D3


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+ate& being collected from a tapped rubber tree.

(ordlandia "ubber Trees' 195
http://www.thehenryford.org/research/rubberPlantations.aspxhttp://en.wikipedia.org/wiki/File:Latex_-_Hevea_-_Cameroun.JPG


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Bud !rafting in Belterra' 19@0

Blight,stricen rubber tree


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(ordlandia Terracing' 1951

% typical (ordlandia house
http://www.thehenryford.org/research/rubberPlantations.aspx


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Terraced lantation of (ordlandia

+ocation of (ordlandia on side of "iver Tapaoz

case study-ford s rubber plantation

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