October 7 in business history: a line that moved, an airline before its market, and a chip rule that ended as a fee
Three 7 Octobers — Ford's moving assembly line in 1913, the founding of KLM in 1919, and America's 2022 controls on advanced chips — show how a decision that works sends its bill to somebody who was not in the room when it was made.
Three 7 Octobers, and each decision that worked sent its bill to somebody who was not in the room: a line that outran the men at it, an airline built for a market that had not arrived, and a rule meant to stop chip sales that ended up taxing them.
The line that set the pace
Until 7 October 1913 the men at Henry Ford's Highland Park plant in Michigan walked to the car. That day the chassis went onto a moving line, pulled past workers and parts by a motor and a rope, and every major component of the Model T was assembled that way 1 (the Library of Congress dates the introduction to October 1913, HISTORY to the 7th 2).
The build time for one car fell from 12½ hours to 93 minutes, the pair of figures both The Henry Ford and the Library of Congress give 23. The price followed: $850 at the 1908 launch, $490 by 1914, $260 by 1924, with more than fifteen million built before 1927 2.
Then the bill arrived, from the workforce. The line reduced skilled craftwork to short, repeated tasks; men who had taken pride in the job grew bored, came late and quit, and turnover ran at 370 per cent 3. On 5 January 1914 the company answered with money — a $2.70 bonus on a basic day of about $2.30 — and with conditions on drink, lodgers, housekeeping and savings, checked by inspectors from a company Sociological Department 3.
Decision mirror: Ford's chief financial officer, John Lawler, told analysts in October 2023 that the new United Auto Workers agreement would add $850 to $900 of labour cost to every vehicle, and put the strike's cost at $1.3 billion 4.
An airline founded before its passengers
KLM was registered on 7 October 1919 by eight Dutch businessmen on the initiative of the aviator Albert Plesman, who that year staged an Amsterdam aviation exhibition that drew more than half a million visitors 5. Queen Wilhelmina gave it the right to call itself Royal in September 1919, before there was a company to grant it to 5.
The market it was built for did not exist. Its first flight, on 17 May 1920, carried two British journalists and a bundle of newspapers from Croydon to Amsterdam on a leased de Havilland; that first year produced 440 passengers and 22 tons of freight 5. Scheduled services began in 1921; the route that made its name, a regular Amsterdam–Batavia service from September 1929 and the longest scheduled route in the world until 1939, came a decade later 5.
Carrying that gap was never a shareholder's job. After Plesman died at the end of 1953 the Dutch state raised its holding to two-thirds; it was cut to 49.5 per cent in 1966 5.
Decision mirror: On 26 June 2020 the state stood behind €3.4 billion — €2.4 billion of bank facilities under a 90 per cent state guarantee and €1 billion of direct state loan, against conditions on employment terms, restructuring, dividend and governance — and it still holds 9.1 per cent of Air France-KLM 67.
A rule that ended as a fee
On 7 October 2022 the Commerce Department's Bureau of Industry and Security announced two rules restricting China's access to advanced computing chips and the equipment that makes them 8. Licences were required for tools and services going to plants making logic chips of 16 or 14 nanometres and below, DRAM of 18 nanometres half-pitch or less and NAND flash of 128 layers or more, with a presumption of denial for Chinese-owned plants 8. The rules took effect in stages: manufacturing restrictions on 7 October, a bar on U.S. persons supporting those plants on the 12th, computing controls on the 21st 8.
The bill landed on companies that were not the target. Applied Materials, which sells the wafer-fabrication equipment, told investors on 12 October that the rules would cut quarterly net sales by about $400 million, give or take $150 million, taking guidance to $6.4 billion from $6.65 billion, with a similar hit expected next quarter 9.
Decision mirror: On 11 August 2025 Nvidia and AMD agreed to pay the U.S. government 15 per cent of their revenues from the chips they sell in China to get export licences, for Nvidia's H20 and AMD's MI308 10. A rule written to stop the sales became a levy on them.
Three questions for the day
- Who staffs the capacity you are adding? Ford's 370 per cent turnover rate bought a doubled wage in 1914 3; by 2023 that labour cost $850 to $900 a vehicle 4.
- Who carries the business until its market forms? The Dutch state has been on KLM's register since 1953, at two-thirds, then 49.5, now 9.1 per cent 57.
- Who collects when your restriction bites? Applied Materials cut a guided quarter by about $400 million within days 9; the 2025 version collected 15 per cent of the sales it was written to stop 10.
References
- 1
- 2
- 3The Henry Ford, "Ford's Five Dollar Day Revolution"
thehenryford.org
- 4
- 5Wikipedia, "KLM"
en.wikipedia.org
- 6
- 7Air France-KLM, "Shareholding structure"
airfranceklm.com
- 8
- 9Applied Materials, Form 8-K exhibit 99.1, 12 October 2022
ir.appliedmaterials.com
- 10
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