By 1905, Olds Motor Works production reached 5,000 units a year, largely due to Ransom's tireless efforts to promote, race, and improve his product. Automotive speed records took up some of his time, and because Florida's beaches offered the smoothest racing surface, Ransom began investing in real estate in the Sunshine State.
Trouble at the factory began again when Frederick Smith, son of one of the original backers, began interjecting his management views. Since Smith was the president and handled the sales end, tensions increased. When he entered the engineering side as well, Ransom terminated his relationship with Olds Motor Works.
Returning to his familiar Lansing base, he started the R.E. Olds Company. Threatened by several lawsuits from his previous business partners, Ransom renamed his new venture REO Motor Car Company. The REO brand was an immediate success, selling a record number of automobiles from 1905 to 1909. The REO brand proved more profitable than his original Olds Motor Works, which had become part of General Motors.
Management conflicts occurred again at the REO Motor Car Company, though this time Ransom kept his hand in its operation. With the fall of the stock market and the beginning of the depression years, Ransom became more and more active, returning to the head chair in 1934. Ransom attempted several new projects, including a smaller REO automotive platform, a delivery van, and an enlarged transit bus line in 1934. But by 1936, the REO-branded automobiles ceased production, and Ransom retired from the automotive industry.
The Truck Side
The REO Motor Truck Company was organized as a subsidiary of the REO Motor Car Company and began truck production in the later part of 1910. Two years earlier, however, the REO car division was producing one-cylindered Model H vehicles on special order basis. Two versions of the Model H were offered-a basic motorized wagon, and a more civilized semi-enclosed Express. Both offerings were mounted on a modified automobile chassis. The standard gasoline-powered engine was a single-cylinder unit, which produced 12 horsepower. REO's double chaindrive supplied power to both rear wheels that were mounted on roller bearing axles. These 3/4-ton tucks were $750.
REO increased its truck lineup at the beginning of World War I to include an $1,800 2-ton Model J. Powered by gasoline four-cylinders, the high-end trucks featured load capacities of up to 5,000 pounds. During this early period, REO trucks were considered to be the gold standard in many commercial circles.
The Original Speedwagon
The company introduced its legendary Speedwagon truck in 1915. The Speedwagon was the forerunner of today's pickup. Its sales success was copied by the competition, with sixty individual variations soon appearing. By 1925, REO's original concept was blurred entirely.
REO's Speedwagon continued to offer industry firsts: electric starters and lighting, shaft-driven axles, and pneumatic tires mounted on steel wheels. The company expanded the option list for its lightweight Speedwagons and added heavier versions with up to 2 tons of capacity. In reality, the company dominated the commercial truck field. More than 125,000 Speedwagons were produced by 1925.