In 1920, a new Ford Model T Runabout cost as little as $395. This remarkably low price was part of Henry Ford’s mission to make cars affordable for the average American family. When adjusted for inflation, this is equivalent to just over $6,000 in today’s money, a price that remains shocking for a brand-new car.
Have you ever wondered what it was like to buy a car in the early days? It can be fun to look back and see how much things have changed. Today, buying a new car is a big decision that costs a lot of money. But what about a hundred years ago? Thinking about the price of a car in 1920 opens up a fascinating story.
It’s a story not just about money, but about a big idea that changed the world forever. You might be surprised to learn how affordable a brand-new car could be. In this article, we’ll explore exactly how much a Ford cost in 1920. We will also uncover the simple reasons why it was so cheap and how that low price put the entire country on wheels. Let’s dive in!
The Simple Answer: The Price of a 1920 Ford Model T
When people talk about Ford cars in 1920, they are almost always talking about one specific car: the legendary Model T. This was the car that Henry Ford built for the masses. It was simple, tough, and, most importantly, incredibly affordable.
In 1920, the price for a brand-new Ford Model T varied depending on the body style you chose. The most basic and popular model was the two-seater Runabout. You could drive one of these off the lot for just $395. If you needed more space for your family, the five-seater Touring car was also a bargain at $440.
Think about that for a moment. A brand-new car that could give you and your family the freedom to travel anywhere, for under $500. This price point was not an accident. It was the result of a deliberate and brilliant plan by Henry Ford to make his car accessible to nearly everyone, not just the wealthy.
Why Was the Model T So Incredibly Cheap?
Seeing a price tag under $400 for a new car is shocking to us today. How was this possible? The answer lies in the genius of Henry Ford and his revolutionary approach to manufacturing. He wasn’t just building cars; he was building a new way to make things.
The Moving Assembly Line
Before Ford, cars were built one at a time by skilled craftsmen. It was a slow and expensive process. Henry Ford changed everything with the moving assembly line, a system he perfected in 1913. Instead of workers moving around a stationary car, the car chassis moved past the workers.
Each worker was trained to do one specific, simple task over and over. This made the process incredibly fast and efficient. For example, building a Model T frame, known as the chassis, went from taking over 12 hours to just about 90 minutes. This massive time savings translated directly into huge cost savings.
Simplicity and Standardization
The Ford Model T was a masterpiece of simple design. It had no unnecessary parts or fancy features. Everything about it was designed to be easy to produce and easy to repair. Ford used strong, lightweight vanadium steel, which made the car durable without adding expensive weight.
Furthermore, every Model T was nearly identical. The parts were standardized, meaning a part from one car would fit perfectly on any other. This is where the famous quote, “any customer can have a car painted any color that he wants, so long as it is black,” comes from. From 1914 to 1925, black was the only color available because it was the fastest-drying paint, allowing the assembly line to move even quicker.
Economies of Scale
By producing millions of the same car, Ford was able to buy raw materials like steel and rubber in enormous quantities. This is called “economies of scale.” When you buy in bulk, you get a much lower price per unit. Ford passed these savings directly on to the customer. The more cars he built, the cheaper each one became to produce, and he continuously lowered the price to sell even more cars.
1920 Ford Model T Prices: A Complete Breakdown
While the Runabout was the cheapest option, Ford offered a few different versions of the Model T in 1920 to suit different needs. Each was built on the same reliable chassis and engine, but the body, or “coachwork,” was different.
Here is a table showing the factory prices for the main Ford models available in 1920:
| Model Type | Description | 1920 Price (USD) |
|---|---|---|
| Runabout | A simple, open-air two-seater. The most basic and affordable model. | $395 |
| Touring Car | An open-air five-seater, perfect for families. The most popular model sold. | $440 |
| Coupe | An enclosed two-seater, offering protection from the weather. | $750 |
| Sedan | An enclosed four-door model, considered the luxury version of the Model T. | $775 |
| Truck Chassis | Just the engine and frame, for farmers and businesses to build their own truck beds. | $550 |
As you can see, choosing an enclosed model like the Coupe or Sedan nearly doubled the price. At the time, these were considered luxury features. The vast majority of buyers chose the open-air Touring and Runabout models to get the most value for their money.
Putting the Price in Perspective: What That Money Meant in 1920
A price of $395 is hard for us to truly understand today. To grasp how revolutionary this was, we need to look at what that money could buy back then and how it compared to what people earned.
The Cost in Today’s Dollars
One of the best ways to understand an old price is to adjust it for inflation. Using the U.S. Bureau of Labor Statistics CPI Inflation Calculator, we can see what $395 in 1920 is worth today.
A $395 Model T Runabout in 1920 would cost approximately $6,100 in today’s money. This is the truly shocking number. Can you imagine buying a reliable, brand-new car today for just over $6,000? It’s almost unthinkable. Even the most basic modern cars cost more than double that price. This shows just how affordable the Model T was for its time.
Comparing the Cost to Average Income
In 1920, the average annual income for a worker in the United States was about $1,400. This means that a new Ford Model T Runabout cost about 28% of a person’s yearly salary, or a little over three months of work.
This was a game-changer. For the first time, a factory worker, a farmer, or a regular family could realistically save up and buy a brand-new automobile. Henry Ford himself helped make this possible by famously paying his workers $5 a day, which was more than double the average factory wage. This meant his own employees were among his best customers.
What Else Could You Buy in 1920?
Comparing the cost of a car to other everyday items from the same period gives us even more context. Here’s a look at what other things cost around 1920:
| Item | Average Cost in 1920 | Comparison to a Model T Runabout ($395) |
|---|---|---|
| A new house | $6,300 | You could buy about 16 Model Ts for the price of one house. |
| A loaf of bread | $0.12 | The price of a Model T could buy over 3,200 loaves of bread. |
| A gallon of milk | $0.35 | The price of a Model T could buy over 1,100 gallons of milk. |
| A man’s suit | $25 | The price of a Model T was equivalent to about 16 men’s suits. |
| A pound of ground beef | $0.25 | The price of a Model T could buy 1,580 pounds of ground beef. |
This table makes it clear that while a car was still a major purchase, it was no longer an impossible luxury. It had been brought down to the level of other significant household investments, fundamentally changing American life.
The “Shocking” Part: More Than Just a Low Price
The truly shocking part of the Model T’s price wasn’t just the number itself, but the world-changing impact it had. Before the Model T, cars were expensive toys for the rich. Most other automakers in 1920 were still selling cars for well over $1,000, with some luxury models costing as much as a new house.
Ford’s affordable car tore down that wall. It democratized the automobile and gave ordinary people a level of freedom they had never known before.
- Personal Freedom: Families were no longer tied to their immediate town or the nearest train station. They could visit relatives in other states, go on picnics, or explore the country. The “Great American Road Trip” was born.
- Growth of Suburbs: People could now live farther from their jobs in the city, leading to the growth of suburban communities.
- Economic Boom: The auto industry created millions of jobs, not just in car factories but also in related industries like oil, steel, rubber, and road construction. Motels, gas stations, and roadside diners sprang up across the country.
The affordable Ford Model T did more than just move people from one place to another; it reshaped the very landscape of the nation. For more on this incredible history, The Henry Ford Museum is an excellent resource that documents this transformative period in great detail.
What Was It Like to Buy and Own a Ford in 1920?
Buying and driving a Model T was a very different experience from today. There was no financing; you paid in cash. The car itself was incredibly basic. It had a 20-horsepower engine and a top speed of about 45 miles per hour. There was no radio, no air conditioning, and no electric starter until later years. To start the car, you had to turn a hand crank at the front, which could be difficult and even dangerous.
The controls were also different, with three pedals on the floor and a lever on the steering column to control the throttle. Driving one required learning a whole new set of skills.
However, the car was built to be tough and simple to fix. The roads of 1920 were often unpaved and muddy, and the Model T’s high ground clearance and sturdy suspension were designed to handle them. Owners often performed their own repairs, and parts were cheap and widely available at Ford dealerships, which were popping up in nearly every town. It was the perfect car for a country that was still largely rural and rugged.
Frequently Asked Questions (FAQ)
How much did the cheapest Ford cost in 1920?
The cheapest Ford in 1920 was the Model T Runabout, a two-seater model, which cost $395. This was the most basic version available and was extremely popular for its low price.
What was the most expensive Ford Model T in 1920?
The most expensive model was the Ford Model T Sedan, often called the “Centerdoor” sedan. It was a fully enclosed car offering protection from the weather and cost $775.
Did the price of the Model T ever change?
Yes, constantly. Henry Ford’s goal was to make the car cheaper every year. The Model T’s price actually dropped throughout its production. By 1925, the price of a Runabout had fallen to an all-time low of just $260.
What color did the 1920 Ford Model T come in?
In 1920, all Ford Model Ts were painted black. This was because the specific type of black paint used, Japan Black, was the only one that could dry fast enough to keep up with the speed of the assembly line.
How fast could a 1920 Ford Model T go?
The Ford Model T had a top speed of around 40 to 45 miles per hour. While this seems slow today, it was quite reasonable for the road conditions of the 1920s.
Was the Model T considered a good car?
Absolutely. It was considered an excellent car for its time because it was incredibly reliable, durable, and easy to repair. Its simplicity was its greatest strength, making it a dependable vehicle for millions of people.
How many Model Ts were sold?
Over its 19-year production run from 1908 to 1927, Ford sold more than 15 million Model Ts. For many years, it was the best-selling car in the world, and at one point, nearly half the cars on the planet were Ford Model Ts.
Conclusion: A Legacy of Affordability
So, how much did a Ford car cost in 1920? The answer—as low as $395—is indeed shocking, but not just because the number is small. It’s shocking because of what that price represents: a pivotal moment in history when the automobile was transformed from a luxury plaything for the rich into a practical tool for the common person.
Henry Ford’s obsession with efficiency and affordability didn’t just build a car; it built modern America. The low price of the Model T put the nation on wheels, spurred economic growth, and gave millions of families a new sense of freedom and possibility. It stands as a powerful reminder that sometimes the most revolutionary ideas are the ones that make things simpler, more accessible, and available to everyone.