Customer Reviews

A Noble Function: How U-Haul Moved America

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"A Noble Function" is clearly an adoring book that covers the first 20 years of U-Haul (more on this limitation later); the fact that it is copyrighted by U-Haul removes any suspicion about it being a corporate puff-piece. Nonetheless, it does offer some useful insights.

Sam Shoen began his entrepreneurial life cutting hair while attending the University of Oregon during WWII. He was later bounced out of the university's medical school - purportedly for answering for a student not there. (Another source states that Shoen was providing answers for another student.)

Shoen started U-Haul in 1945 after being discharged from the Navy. His initial location was Portland, Oregon, where he contracted the building of trailers. Finding them too non-standard (and therefore unreliable and difficult to repair), he steadily took direct control over more and more of their construction until they were made entirely by himself and direct employees. Rental locations were expanded through sales trips and offering renters 50% discounts if they left trailers at locations willing to continue the program. (Shoen lost more than a few trailers this way and eventually stopped the program.)

Rental rates were originally set via a series of concentric circles. Soon Shoen moved away from random service stations because their having trailers from multiple companies undermined the focus he desired, engendered rate splitting with the California Trailer Exchange etc., and higher repair costs due to assuming repair costs for other firms' less sturdy trailers. Another early step was to break the company into state areas to increase efficiency and accountability (via state managers), while reducing corporate-wide legal liability for accident lawsuits.

U-Haul also had difficulty financing its expansion and construction of new trailers. This was solved with its "Fleet Owner Program" in which an investor's money was matched by a bank, which was then paid off first from the trailer's rental fees. At that point the investor's equity had doubled, and he/she paid fees to U-Haul for subsequent rental efforts and repairs. (U-Haul also provided accident and theft insurance for the investor.)

Eventually U-Haul ran into problems of trailers accumulating in popular destinations - eg. Miami, Arizona, California. This was solved by adding a surcharge for rentals to those areas and also offering discounts to those renting back out of them.

The preceding are all interesting and useful pieces of information, and Sam Shoen's efforts were quite impressive. But then there is the history afterwards not contained in "A Noble Function."

The 1973 oil crisis closed many service stations, while newcomer Ryder rose to take half the market in competition with U-Haul. This led to establishing a new business line - rental stores with a variety of goods. This sapped capital during tough economic times and ultimately had to be closed. Then Sam gifted 95% of U-Haul stock to his 12 (or 13, depending on the source) children by three (four) wives.

A years' long battle for control ensued, with the sons eventually taking control and returning the firm to its basics. In 1999, Sam died after running into a utility pole in an apparent suicide. The year 2002 brought charges of accounting irregularities, missed bond payments in 2003 and declared bankruptcy. It emerged in 2004 with the help of a $550 million loan.

Then there was the 1990 Telluride murder of Eva Shoen - wife of one of Sam's sons. The case is still unsolved, though Eva's husband believes his two sons were the killers.

Finally, the L.A. Times recently reported that U-Haul trailers were involved in a number of serious (often fatal) accidents due to lacking brakes (a violation in 14 states), inoperative brakes, and/or being towed too fast by vehicles too light for the job. And then my own experience - looking for a job in Phoenix and finding U-Haul paying far below the market.

A Noble Function is a good read about the founding of a company most of us have used at one time or another. I was struck by the hard work and loyalty of the men and women who built the company, and the persistance of co-founders L.S. and Anna Mary Shoen to stick with the concept until the company was a success. I enjoyed the first-person insights from the poeple who were there in the beginning. Luke Krueger's style was perfect and made for easy and enjoyable reading. I'm still amazed that the first one-way trailer rentals were made with a handshake and a promise that the customer would find a business at their destination who would rent the trailer to another customer, and send the money to U-Haul ... that was an America that I would love to live in.

A Noble Function offers an interesting look at the first twenty or so years of U-Haul history and how the company rose to prominence. This book focuses on the hard work and determination of the founder Sam Schoen and his family as they built an American icon and household name. From the days of sorting out the trailer business and developing a standard model capable of easy repairs to an expanding network of dealers this book tracks the strategies the company took to become a household name. As one of the first companies to develop trucks and rent them U-Haul had an early corner on the market that helped to ensure its dominance will into the 1960's. What this book does not cover is U-Haul's subsequent decline and fall from grace as companies like Ryder and Budget sapped market share and forced U-Haul into bankruptcy. That being said if you want an interesting look on how this company rose to its peak you cannot go wrong with this one.