Association of Licensed Automobile Manufacturers

The Association of Licensed Automobile Manufacturers (ALAM), originally the Manufacturer's Mutual Association (MMA), was an organization originally formed to challenge the litigation of the fledgling automobile industry by George B. Selden and the Electric Vehicle Company. Ultimately, the organization took advantage of its power and became Selden's greatest ally. In exchange for favorable royalty rates, the group gained the power to litigate and exclude other manufacturers from licensing, making them the most powerful group in the early automotive industry.

In 1899, the Electric Vehicle Company purchased the rights to Selden's automobile patent. The patent was deemed flimsy by most of the industry, but the company purchased the rights to guarantee the legality of their new venture, the Columbia Automobile Company. A year later, however, the Columbia Automobile Company was in shambles thanks to internal corruption and low demand for electric vehicles, and the Electric Vehicle Company turned to the Selden patent as an alternative source of revenue. They set out to have manufacturers pay a 5% royalty on all cars produced.

By 1900, The Electric Vehicle Company launched several lawsuits against automobile manufacturers. Their ultimate target among the fray was Alexander Winton, and his Winton Motor Carriage Company. Originally formed in 1896, the Winton Company was by 1900 the highest-volume automobile producer in the US. If the patent were to gain validity in the industry, Selden believed, they needed to tackle the largest manufacturer.

The Winton Company's defense made the costly mistake of concentrating on challenging the patent’s validity through demurrer; by 1902 the case was still tied up and Winton was considering a settlement. In response to his distress, other independent automobile makers formed a group called the Manufacturers Mutual Association to breathe new life into Winton's legal defense. Formed by Henry Bourne Joy and Frederic L. Smith of Packard and Olds, the two entrepreneurs used their position to threaten the Electric Vehicle Company. The MMA called for much lower royalty payments and for the legal and license rights to be controlled by the MMA, or else they would bolster Winton's dying legal fund.

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