On this day: in history (1918), the General Motors Corporation (GM) acquired Chevrolet Motor Company.
GM was founded in 1908 by William C. Durant, a former carriage maker from Flint, Michigan, whose Durant-Dort Carriage Company had taken control of the dying Buick Motor Company. Durant, with the board’s approval, tried acquiring Ford Motor Company in 1909, but needed an additional $2 million. Durant over-leveraged GM in making these acquisitions. With GM struggling financially, stockholders blamed Durant’s aggressive expansionism and forced him out of the company he founded. In November 1911, he launched Chevrolet Motor Company, named for his partner, the Swiss race car driver Louis Chevrolet.
Still the owner of a considerable portion of GM stock, Durant began to purchase more shares in the company as his profits from Chevrolet allowed. In a final move to regain control, Durant offered GM stockholders five shares of Chevrolet stock for every one share of GM stock. Though GM stock prices were exorbitantly high, the market interest in Chevrolet made the five-for-one trade irresistible to GM shareholders. With the sale concluded, Durant regained control of GM. Just two years later, however, he was pushed out for good by Pierre S. DuPont, whose family’s powerful chemical company had begun investing in the auto industry by buying GM stock in 1914. Pierre DuPont subsequently rose to the chairmanship of GM’s board and became president in 1920. In an agreement made that same year, DuPont paid off all of Durant’s debt; in exchange, Durant left the company.
Durant refused to bow out of the automotive industry, however, founding Durant Motors in 1921 and producing a line of cars for the next decade. The Great Depression in the early 1930s put an end to Durant’s career in cars. He died on March 18, 1947, at the age of 85.
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Created by Okey Obiabunmo
