Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.
On this day 78 years ago, Ford Motor Company (NYSE: F) agreed to begin manufacturing Rolls-Royce engines to assist the British in World War II.
Where The Market Was
The Dow closed at 121.46. The S&P 500 traded at around 9.70. Today, the Dow is trading at 25,322.31 and the S&P 500 is trading at 2,782.00.
What Else Was Going On In The World?
In 1940, Germany and Italy agreed to form a World War II alliance against France and the U.K. The popular comic book "Captain America" debuted, featuring the hero punching real-life Nazi leader Adolf Hitler on the cover of the first issue. Average monthly rent was $30.
Ford’s War Effort
In early 1940, Germany had already conquered Poland, Norway and Denmark and was on the brink of defeating France as well. The U.K. became increasingly aware that a German invasion was imminent, and the British government reached out to the U.S. for help. At the time, the U.S. had no intention of joining the war, but U.S. Office of Production Management director and former General Motors Company (NYSE: GM) president William Knudsen understood the importance of supporting U.S. allies in their fight against the Germans.
Knudsen reached out to Edsel Ford with a proposal for Ford to manufacture 9,000 airplane engines designed by British automaker Rolls-Royce to aid in the war effort. On June 12, 1940, Edsel Ford telephoned Knudsen to accept the proposal.
When news broke of the deal, Edsel Ford’s father Henry publicly canceled the deal, telling reporters that Ford was not in business with any government. A year later, Ford opened a new plant in Willow Run, Michigan for the purposes of manufacturing B-24E Liberator bombers for Allied forces. When the U.S. officially joined the war, Ford ultimately produced a number of engines, trucks, jeeps, tanks and tank destroyers to help support the Allied effort.
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Photo by JAW/Wikimedia.