From the Model T to mobility’s next big inflection point

Rajat Dhawan, Russell Hensley, Asutosh Padhi & Andreas Tschiesner

There is a well-known quote attributed to Henry Ford that he actually never said but historians confirm he almost certainly believed: “If I had asked people what they wanted, they would have said faster horses.”

The story resonates, of course, because we know what consumers circa 1900 thought mobility was supposed to mean, and we know from about 1920 onward what mobility in fact came to mean.

And still does. Indeed, the extent to which Ford’s (and his contemporaries’) automobile paradigm has endured is remarkable. One hundred years ago, mobility conjured cars and trucks, a space to park and the price at the pump, city streets and open roads.

And more: “The freedom machine,” mass transportation, car dealerships, internal combustion. Congestion. Accidents. Pollution. At the first great inflection point, the fundamental dimensions of transportation — cost, convenience, user experience, safety, and environment — saw “mobility” and “cars” become well-nigh synonymous.

That was a dramatic shift from the previous several hundred years, when overland mobility meant horses, which people needed in ever-growing numbers. Emissions problems of a different sort than today’s were an unintended consequence.

In 1894, the London Times ran the numbers: at prevailing rates, nine feet of manure would accumulate on city streets by the mid-1940s. The amazing developments of 1900–20 represented mobility’s first inflection point.

They took us from steam to internal combustion engines (ICEs), the “Great Horse Manure Crisis” of 1894 to “Big Oil,” and premium automobiles for the few to mass-produced cars for the millions.

They also altered and even birthed entire businesses, industries, and government entities that developed alongside, but distinct from, the automotive industry — repair shops, highway authorities, gas stations, commuter railways, and car washes, to name just a few. The landscape has endured for decades.

But for how much longer? By 2030, we will see developments that may be as profound as those of a hundred years before. Radical changes — “horses-to-cars” changes, “how-we-think-about-mobility” changes — are coming, even faster this time, and across multiple dimensions.

The characteristics of mobility at the second great inflection point will be significantly, not just marginally, better. Electric and autonomous vehicles, more interconnected and intelligent road networks, new customer interfaces and services, and a dramatically different competitive landscape in which tech giants, startups, and OEMs mix and mingle are just a few of the shifts in store.

Radical improvements in cost-effectiveness, convenience, experience, safety, and environmental impact will, taken together, disrupt myriad business models on an almost inconceivable scale.

With any luck, it will be what people actually want — not “faster horses,” — but something qualitatively different and better. We call these coming changes mobility’s Second Great Inflection Point.

In this write-up, we will explain why we think it’s coming, starting with a look back at the inflection point that took place 100 years ago, including its unintended consequences, and the forces at work pushing toward a new paradigm.

A second (separate) companion article will lay out the likely characteristics of the emerging mobility ecosystem, along with the impact it is likely to have on business and society. As with many great changes, the picture is compelling both at a distance and in close-up.

More than two dozen of our McKinsey colleagues, plus some of the executives leading the charge toward the future, provide the latter — snapshots of the technology shifts that leaders should have on their radar screen, the variations on this story in different geographies, and the ways in which cities as we know them are likely to change.

Neither we nor anyone else knows exactly how or when these shifts will play out. What has become increasingly clear is that the change is coming much faster than most of us thought possible just a few years ago.

When discussing automobiles and timelines, it is worth remembering that it took a long time for the car to become mainstream. The first steam-powered vehicle was crafted in the late 17th century, though it was too small to carry people or cargo.

It took 200 years for contraptions with internal-combustion engines to be on the open roads. By the dawn of the 20th century, vehicles were progressing from open “buggies without horses” to more sophisticated “road locomotives” — self-powered cars.

Until the dawn of the 20th century, however, these vehicles had been tailored primarily for the privileged “class” market. What made the Model T so transformative when it rolled out in October 1908 was not that it introduced the assembly line (it didn’t) or that it was an inconceivable leap in technology (it wasn’t).

Instead, the Model T’s combination of reliability, innovation, and, especially, affordability could at last bring personalised, mechanised mobility to the masses. Henry Ford famously made sure to pay his employees $5 per day; they, too, would be able to afford them. His car was priced around $500, less than $10,000 in today’s dollars.

The freedom machine was born, and giving the people what they wanted (lower transportation costs, more convenience, a better driving experience), even with the trade-offs (particularly in terms of safety and the environment), sparked one of the greatest success stories in business history.

In 1900, about 4,000 automobiles were produced in the United States; none of them were trucks. During the 1910s, the number of automobiles across different parts of the United States began to eclipse the number of horses and buggies. By 1920, America had more than 9.2 million registered motor vehicles, including more than one million trucks.

The writers are with McKinsey across Gurugram, Munich, Chicago and Detroit

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