John S. Gray (Michigan)
Encyclopedia
John Simpson Gray was a candymaker, business man, and banker from Detroit. He was also an original investor in (and the first president of) the Ford Motor Company
.
. However, Gray's father decided farming was not a suitable profession, and in 1857 the family moved to Detroit.
Gray attended high school in Detroit in 1857 and 1858, then took a job as a school teacher in Algonac, Michigan
, over the winter of 1858-59. While Gray was engaged teaching school, his father bought a toy store in Detroit. John entered his father's business when he returned in 1859. In 1861, the father and son sold the store and entered into a partnership with C. Pelgrim to manufacture candy, styling the firm name Pelgrim, Gray & Company. The company grew steadily, despite suffering a disastrous fire in 1862.
Gray married Anna E. Hayward of Beloit, Wisconsin
on October 31, 1864. The couple had four children: Philip H. Gray, Paul R. Gray, David Gray, and Alice Gray.
Soon both Pelgrim and the elder Gray retired from Pelgrim, Gray & Co., and the firm took on a new partner, Joseph Toynton. In 1865 the name was changed to Gray & Toynton. The business grew rapidly, forcing moves to ever-larger quarters. In 1870, J. B. Fox joined as a partner, with the requisite name change to Gray, Toynton & Fox, and the firm continued growing until both Toynton and Fox died in 1881.
With this wealth, Gray widened his business interests. He went into the lumber business with Orin W. Grover, incorporating as "Grover and Gray," doing business in Cheboygan, Michigan
, and Detroit. He was also a director of the Detroit Trust Company, the Detroit Photographic Company, and the Norris Kollar & Kuff Company, and was the president of the Detroit Library Commission
. In 1894, Gray became president of the German American Bank.
Gray eventually sold Gray, Toynton & Fox to the National Candy Company in 1903. He became a vice-president of the larger company.
, a frequent financing customer at Gray's German-American Savings Bank. Malcomson was a coal dealer, but had set up a separate partnership, Ford and Malcomson, with Henry Ford
to manufacture an automobile. However, Ford and Malcomson had absorbed more money than expected, and the manufacturing firm of John
and Horace Dodge
, who had made parts for Ford and Malcomson, was demanding payment. Malcomson proposed incorporating the company to bring in new investors, and wanted Gray to join the company, thinking that Gray's name would attract others to invest.
Gray was at first disinclined to accommodate Malcomson, but Malcomson promised he could withdraw his share at any time, so Gray reluctantly agreed to invest $10,500 in return for a 10.5% stake in the company. On the strength of Gray's name, Malcomson attracted enough other investors to bankroll the new company, even convincing the Dodges to accept stock in lieu of payment. On June 16, 1903, the Ford Motor Company was incorporated, with 12 investors owning a total of 1000 shares valued at $100,000. At the first meeting of stockholders, Gray was elected president, Henry Ford vice-president, and James Couzens secretary.
Despite Gray's misgivings, Ford Motor Company was immediately profitable, with profits by October 1, 1903 of almost $37,000. A dividend of 10% was paid that October, an additional dividend of 20% at the beginning of 1904, and another 68% in June of 1904. Two dividends of 100% each in June and July 1905 brought the total investor profits to nearly 300% of the initial investment in just over 2 years; 1905 total profits were almost $300,000.
However, despite the booming business, there were internal frictions in the company that Gray was nominally in charge of. Most of the investors, Malcomson and Gray included, had their own businesses to attend to; only Ford and Couzens worked full-time at the company, and Ford chafed at the status quo. The issue came to a head when the principal stockholders, Ford and Malcomson, quarreled over the future direction of the company. Gray sided with Ford, and by early 1906 Malcomson was effectively frozen out of the Ford Motor Company (and, indeed, had started his own competing auto company, AeroCar
). In May, Malcomson sold his shares to Henry Ford, leaving the Ford Motor Company vice-president as majority stockholder.
Ford Motor Company
Ford Motor Company is an American multinational automaker based in Dearborn, Michigan, a suburb of Detroit. The automaker was founded by Henry Ford and incorporated on June 16, 1903. In addition to the Ford and Lincoln brands, Ford also owns a small stake in Mazda in Japan and Aston Martin in the UK...
.
Early life
John S. Gray was born in Edinburgh, Scotland, on October 5, 1841, the son of Philip C. and Amelia Gray. In 1849, the family emigrated to the United States and settled on a farm in WisconsinWisconsin
Wisconsin is a U.S. state located in the north-central United States and is part of the Midwest. It is bordered by Minnesota to the west, Iowa to the southwest, Illinois to the south, Lake Michigan to the east, Michigan to the northeast, and Lake Superior to the north. Wisconsin's capital is...
. However, Gray's father decided farming was not a suitable profession, and in 1857 the family moved to Detroit.
Gray attended high school in Detroit in 1857 and 1858, then took a job as a school teacher in Algonac, Michigan
Algonac, Michigan
Algonac is a city in St. Clair County of the U.S. state of Michigan. The population was 4,613 at the 2000 census.Algonac is located at the southern end of the St. Clair River, just before it splits into a large delta region known as the St. Clair Flats. The St. Clair River drains Lake Huron into...
, over the winter of 1858-59. While Gray was engaged teaching school, his father bought a toy store in Detroit. John entered his father's business when he returned in 1859. In 1861, the father and son sold the store and entered into a partnership with C. Pelgrim to manufacture candy, styling the firm name Pelgrim, Gray & Company. The company grew steadily, despite suffering a disastrous fire in 1862.
Gray married Anna E. Hayward of Beloit, Wisconsin
Beloit, Wisconsin
Beloit is a city in Rock County, Wisconsin, United States. As of the 2010 census, Beloit had a population of 36,966. The greater Beloit area is home to more than 91,000 residents.-Claim to fame:...
on October 31, 1864. The couple had four children: Philip H. Gray, Paul R. Gray, David Gray, and Alice Gray.
Soon both Pelgrim and the elder Gray retired from Pelgrim, Gray & Co., and the firm took on a new partner, Joseph Toynton. In 1865 the name was changed to Gray & Toynton. The business grew rapidly, forcing moves to ever-larger quarters. In 1870, J. B. Fox joined as a partner, with the requisite name change to Gray, Toynton & Fox, and the firm continued growing until both Toynton and Fox died in 1881.
Gray, Toynton & Fox, and other business
With the passing of his partners, Gray incorporated the firm (but kept the name), and by 1891 Gray, Toynton & Fox was ensconced in a five-story building, employing 150 people (and up to 200 people during the peak season) and producing $400,000 of candy per year with nationwide distribution.With this wealth, Gray widened his business interests. He went into the lumber business with Orin W. Grover, incorporating as "Grover and Gray," doing business in Cheboygan, Michigan
Cheboygan, Michigan
Cheboygan is a city in the U.S. state of Michigan. As of the 2000 census, the city population was 5,295. It is the county seat of Cheboygan County....
, and Detroit. He was also a director of the Detroit Trust Company, the Detroit Photographic Company, and the Norris Kollar & Kuff Company, and was the president of the Detroit Library Commission
Detroit Public Library
The Detroit Public Library is the second largest library system in Michigan by volumes held , and is the 20th largest library system in the United States. It is composed of a Main Library on Woodward Avenue, which houses DPL administration offices, and twenty-three branch locations across the city...
. In 1894, Gray became president of the German American Bank.
Gray eventually sold Gray, Toynton & Fox to the National Candy Company in 1903. He became a vice-president of the larger company.
Ford Motor Company
In February 1903, John S. Gray was approached by his nephew Alexander Y. MalcomsonAlexander Y. Malcomson
Alexander Y. Malcomson was a coal dealer from Detroit, Michigan who bankrolled Henry Ford's first successful foray into automobile manufacturing: the Ford Motor Company.- Early life :...
, a frequent financing customer at Gray's German-American Savings Bank. Malcomson was a coal dealer, but had set up a separate partnership, Ford and Malcomson, with Henry Ford
Henry Ford
Henry Ford was an American industrialist, the founder of the Ford Motor Company, and sponsor of the development of the assembly line technique of mass production. His introduction of the Model T automobile revolutionized transportation and American industry...
to manufacture an automobile. However, Ford and Malcomson had absorbed more money than expected, and the manufacturing firm of John
John Francis Dodge
John Francis Dodge was an American automobile manufacturing pioneer and co-founder of Dodge Brothers Company.-Biography:...
and Horace Dodge
Horace Elgin Dodge
Horace Elgin Dodge, Sr. was an American automobile manufacturing pioneer and co-founder of Dodge Brothers Company.-Early years and business:...
, who had made parts for Ford and Malcomson, was demanding payment. Malcomson proposed incorporating the company to bring in new investors, and wanted Gray to join the company, thinking that Gray's name would attract others to invest.
Gray was at first disinclined to accommodate Malcomson, but Malcomson promised he could withdraw his share at any time, so Gray reluctantly agreed to invest $10,500 in return for a 10.5% stake in the company. On the strength of Gray's name, Malcomson attracted enough other investors to bankroll the new company, even convincing the Dodges to accept stock in lieu of payment. On June 16, 1903, the Ford Motor Company was incorporated, with 12 investors owning a total of 1000 shares valued at $100,000. At the first meeting of stockholders, Gray was elected president, Henry Ford vice-president, and James Couzens secretary.
Despite Gray's misgivings, Ford Motor Company was immediately profitable, with profits by October 1, 1903 of almost $37,000. A dividend of 10% was paid that October, an additional dividend of 20% at the beginning of 1904, and another 68% in June of 1904. Two dividends of 100% each in June and July 1905 brought the total investor profits to nearly 300% of the initial investment in just over 2 years; 1905 total profits were almost $300,000.
However, despite the booming business, there were internal frictions in the company that Gray was nominally in charge of. Most of the investors, Malcomson and Gray included, had their own businesses to attend to; only Ford and Couzens worked full-time at the company, and Ford chafed at the status quo. The issue came to a head when the principal stockholders, Ford and Malcomson, quarreled over the future direction of the company. Gray sided with Ford, and by early 1906 Malcomson was effectively frozen out of the Ford Motor Company (and, indeed, had started his own competing auto company, AeroCar
Aerocar (1905 automobile)
The Aerocar was an American automobile built from 1905 to 1908 in Detroit, Michigan. Backed by Henry Ford's former partner, coal merchant Alexander Malcomson, the short-lived company offered an air-cooled 24 hp four-cylinder luxury car which sold for $2800.The factory was sold to Hudson Motor Car...
). In May, Malcomson sold his shares to Henry Ford, leaving the Ford Motor Company vice-president as majority stockholder.