Arthur Vining Davis (1867-1962) was the general manager of the Aluminum Company of America (ALCOA) for more than half a century. He also served as president of the company and as chairman of the board for shorter periods.
Arthur Vining Davis
Arthur Vining Davis was born on May 30, 1867, in Sharon, Massachusetts, the son of a Congregational minister. He was educated in Hyde Park, Massachusetts, and Roxbury Latin School in Boston. He then went on to Amherst College. Upon graduation in 1888 he moved to Pittsburgh to take a job at $14 a week with a new company planning to manufacture a new, light metal.
Although aluminum had been on the market for a number of years, it was an inordinately expensive product, selling for $8 a pound in the 1880s. In 1886, however, 22 year old Charles Martin Hall developed a process for making aluminum in an Ohio woodshed which would substantially reduce the price. After trying for two years without success to interest anyone in the Ohio area in the process, Hall came to Pittsburgh in 1888. There he found a young metallurgist, Alfred E. Hunt, who recognized the value of the process. Hunt, in turn, was able to interest a group of young Pittsburghers to provide financial support for the project.
Hunt was a native of Massachusetts whose parents had attended Rev. Davis's Congregational Church in Hyde Park. When young Davis graduated from Amherst, his father asked Hunt to secure a position for his son in Pittsburgh. Hunt at that time was a partner in the Pittsburgh Testing Laboratory, but had just formed his association with Hall to manufacture aluminum. Davis, therefore, was present in Pittsburgh in time for Hunt to bring him into the company for the birth of the modern aluminum industry. Hunt and Hall had set up the Pittsburgh Reduction Company in July 1888 with a combined capital of just $20,000. With this money they built and equipped a small experimental plant which was able to demonstrate that Hall's process was commercially sound. Hall had put up no money, and Hunt had gotten a number of acquaintances in the steel industry, including George H. Clapp, Howard Lash, Robert Scott, Millard Hunsicker, and W. S. Sample, to contribute funds.
Davis at that time had no money and held no stock in the company. He was appointed assistant to Hall as they endeavored to work out technical problems with the process. Davis, however, early showed that his abilities lay outside the plant, becoming a superb salesman and executive. It was Davis who largely had the task of convincing people that aluminum, still relatively expensive, could be used for a number of products. He particularly made important inroads in the kitchen utensil field, getting items fabricated in his company's plant and then sending a team of college students on the road to peddle them to housewives. In this way Davis convinced utensil manufacturers of aluminum's value. In 1891 Davis was made a stockholder in the firm, just shortly after Andrew W. and Richard B. Mellon provided important funds for the expansion of the enterprise. It was the Mellons, more than anyone else, who recognized the worth of Davis to the enterprise and persuaded the other partners to give Davis some of their stock.
Davis became general manager of the firm in the 1890s and was Hunt's right hand man. When Hunt died in 1899 he was succeeded by Richard B. Mellon, and Davis did not become president of the company, by then called the Aluminum Company of America (Alcoa), until 1910, although he had been acting manager of the concern during all those years. He became chairman of the board in 1928. It was Davis, working in tandem with the Mellons, who developed the aluminum industry in the United States. In turn, they made Alcoa the wholly dominant company in the field until the intervention of the government at the end of World War II.
Alcoa's domination of the aluminum industry had the company in continual conflict with the federal government. In 1913 Davis admitted to a House inquiry that an international agreement (cartel) covered the aluminum industry. From that time until 1937, when the federal government filed an anti-trust suit to force Alcoa executives to divest their holdings in the Aluminum Company of Canada, Ltd., Davis kept the government at bay. To forestall anti-trust activity, Davis had worked closely with the government during both world wars, insuring that there would be no shortages of the valuable metal. He played a particularly prominent role in the aluminum production drive during World War II, helping to attain an output vital to the Allied achievement of air superiority. For this work he got a Presidential Certificate of Merit. In spite of this, in a landmark decision in 1945 the Supreme Court found that Alcoa constituted a monopoly under Section 2 of the Sherman Act. This was the first major revision of the old "rule of reason," since it was admitted that Alcoa had not misused its monopoly position, but that the mere size of the company and its potential for misdeeds was illegal.
Although Davis remained chairman of Alcoa until 1957 he resigned from active management in 1948. At 80 he retired to Florida, seemingly ready for shuffleboard and canasta. Instead he began a second career in Florida real estate. Worth at that time some $350 million, he began buying vast tracts of raw acreage, soon becoming the most closely watched and controversial investor in the state. His belief in Florida real estate's "inevitable increase in value" was one of the factors bringing Davis to the area in 1948. His purchases of 125,000 acres included one-eighth of Dade County. He also bought 30,000 acres on Eleuthera Island in the Bahamas, where he developed a resort. He owned an ice cream plant, vegetable farms, a cement plant, a road building company, a steel fabricating plant, a furniture plant, and an airline. He purchased the Boca Raton Hotel and Club for $22.5 million and property in Sarasota on the Gulf coast for $13.5 million. When asked by a reporter what he had in mind with all of these Florida purchases, Davis replied, "Making money. What else? Now go away, let me get on with it."
Davis had a reputation during his lifetime as a "terrible tempered tycoon," ruling Alcoa and his Florida enterprises with a desk-thumping autocracy. When he died in Florida on November 17, 1962, at age 95, he was, by his own admission, the fifth richest man in America. Although parsimonious in life, he was generous in his posthumous benefactions. One-fourth of his estate went for taxes and individual bequests, with $300 million left to trusts held by two banks in Miami and Pittsburgh. Earmarked for two A. V. Davis Foundations, the net income was to be used for "charitable, scientific, literary, and educational purposes." The income was expected to yield a minimum of $13.5 million annually. Davis had joined what TIME called "the most distinguished club in U.S. capitalism"—the founders of vast philanthropic foundations.
Further Reading on Arthur Vining Davis
There is no biography of Davis. The best information on him and the aluminum industry may be found in Charles Carr, Alcoa: An American Enterprise (1952).