Addendum 4:


Addendum 4:

History

In the 1960s and 1970s, the American special machine tool industry was flourishing. Six leading companies, four located in the Detroit area and two in Rockford, Illinois, were quite close in size. Their annual sales were in the $60 million range at that time, which would be in the $200 million range in today’s dollars. In addition, there were numerous other active companies of real substance many in the Detroit area and others in the Midwest and New England states. These were fine companies, well- known in their circles, respected around the world, and with one exception were closely held. They were prospering, growing, and expanding their technological base.

One of the larger companies, The Cross Company, began a second major operation in Germany and then a third in England and then initiated a 50 percent ownership joint venture in Japan. In the late 1960s, Cross started an industry related computer company of very significant proportions - a visionary concept (computer control of machine tools was in its infancy at that time). A second major manufacturing operation in the U.S. followed.

Another of the larger companies, LaSalle Machine Tool Company, acquired a medium sized machine tool company in Italy, started another through acquisition in Canada and began two other significant operations in the U.S.. Still another, Ingersoll Milling Machine Company, acquired several German machine tool companies over a period of time and another in England while growing and modernizing their domestic operations substantially. In the late 1980s Ingersoll acquired a small machine tool company in Michigan, CM Systems, specializing in crankshaft production machinery. Another of the larger companies, F. Jos. Lamb, added operations in Canada, Germany and in England. A second major operation was added in the U.S. as well. Buhr Machine Tool started an operation in England, expanded their operations in Ann Arbor Michigan substantially and added a significant engineering facility in Detroit..

A Detroit company, another of the larger ones, EX-CELL-O Corporation, itself a division of a larger corporation, acquired a smaller privately held company in Howell Michigan, A.E. Parker, and another larger company in Rockford Illinois, Greenlee Brothers. EX-CELL-O also operated a substantial special machine tool division in Germany and smaller facilities in Canada. H.R. Krueger, one of the smaller companies, whose history goes back to the early automobile days, also acquired an operation in England.

Now, 25 years later, of the mostly closely held companies, one of the larger, Ingersoll, remains American and family-owned (although at the time of this effort the company has been split and the production machine portion sold to a Chinese machine tool company). One other, Lamb, is still American-owned by a large corporation, Unova. There remain a few small closely held companies; however, the rest were closed, absorbed by others or were eventually purchased by foreign competitors, largely German.

Those foreign companies recognized the opportunity to participate in the greatest market opportunities in the world and to take advantage of available talent and technology. A very favorable ongoing currency exchange rate, the DM and then the Euro to the Dollar, made it possible to mix American and German content to provide a lethal competitive posture in the American market.

Several additional foreign builders now have operations in the Detroit area –Italian, German and Spanish companies. All enjoy the favorable currency exchange rate.

The American companies had been designing and building machine tools and entire manufacturing systems for companies around the world, largely for engine and vehicle manufacturers. A number of machines were delivered to Japan and played a roll in the Japanese resurgence. Interestingly, the Japanese bought only one of a kind. They found the way to make later requirements themselves. Later machine generations were, many times, improvements of the purchased machines. Some of these original machines are probably still in operation today.

Several of these companies did a substantial amount of business in the former Soviet Union and other iron curtain countries in that time frame, supplying complete manufacturing systems with appropriate agreement of the governments involved.