Clark Michigan

Clark Michigan was the construction machinery division of the Clark Equipment Company.

History

In 1903, the Clark Equipment Co. existed as George R. Rich Manufacturing Co., a side business owned by executives of the Illinois Steel Co. The company was named after a mechanic who designed the Celfor Drill, used for drilling holes in steel railroad rails. The company was in need of a larger facility to increase its client base, and in 1904 relocated to Buchanan, Michigan. Troubled financial times resulted in the company hiring Eugene Clark, a 33-year-old Illinois Steel employee and mechanical engineer, as a product consultant. Clark determined that the metallurgy of the drill was faulty.

Rich Manufacturing was eventually renamed Celfor Tool Co. Under Clark’s management, sales steadily inclined with the company manufacturing new drills of tungsten steel. By 1909, the company had paid its first dividends to investors.

The same year, Clark also traveled to Europe and learned that using electric furnaces was producing steel castings of a higher quality. Convinced that such a process would take off in the U.S., Clark and executives at Celfor Tools constructed a second plant, Buchanan Electric Steel Co. The plant would be used to produce high-quality, high-grade steel castings and new technologies. Eventually, Buchanan Electric Steel Co. was one of two companies in the U.S. producing steel disc wheels for the automotive industry.

As president, Clark decided to focus production efforts on turning out durable steel truck wheels replacing the wooden spoke truck wheels and a truck axle that replaced chain drives.

Formation of Clark Equipment Co.

In 1916, Clark decided to merge Celfor Tools and Buchanan together to form the Clark Equipment Co. The merger provided an opportunity to develop a range of new products. One of these was a gas-powered shop buggy with a box fixed to three wheels. Initially designed by foundry workers to cart supplies around the plant, visitors saw something of inherent value in the early rendering of the buggy and showed interest in purchasing it. The final revamped version of the buggy with improved steering and the addition of brakes was introduced during World War I, eventually evolving into a product known as the Trucktractor. At first, the trucktractor had a box that could be dumped first by gravity and then mechanically. Next, Clark designed incorporated all these features, leading in 1928 to the creation of the lift truck that picked up materials, moved them to another location, and then lifted them up to be stored.

Early Growth and Diversification

By the mid-1920s, Clark owned four plants and was manufacturing drills, reamers, electric steel castings, axles, wheels, transmissions, and the Trucktractor. Solid profits over time enabled the company to come out of the 1930s from the Depression relatively unscathed. The company continued to diversify into other product areas including a prototype of a fast, aluminum railcar for the 1934 World Fair called the Auto-Tram. The prototype scored Clark a contract to produce the undercarriage for trolley streetcars and subway systems for the next 20 years. The company’s Trucktractor was also a strong seller in the company’s arsenal of products. By 1943 sales were $77 million up from $12.5 million four years prior, rendering the Clark name synonymous with lift trucks.

Clark and the “Michigan” Trade Name

In 1942 Eugene Clark died and was succeeded by executive vice-president Albert Bonner. By the 1950s the breadth of Clark’s product sales was primarily driven by Michigan’s automotive industry. This placed the company in a precarious position and poised a huge single industry business risk. Management saw diversifying Clark’s product range through development and acquisitions as the solution. In 1953, Clark acquired the Ross Carrier Co., a manufacturer of lift trucks and straddle, and cable carriers. This also included the company’s subsidiary, the Michigan Power Shovel Co., that had a line of wheel loaders still in the early stages of development.

In 1954 Clark announced it was entering the wheel loader market with a line of six models to be sold under the Michigan brand name and ranging from 15 cubic feet (.45 m3) to 2.5 cubic yards (1.9 m3). To mark its entrance in the earth-moving equipment business, the company built a new plant in Benton Harbor, Michigan.

Clark vs. Hough Loaders

Clark’s Michigan wheel loaders were closely modeled after Hough loaders with the engine being placed in the rear of the machine. Clark’s first line of wheel loaders were well received by the industry and the production plant in Benton Harbor quickly tripled in size. This was reflected in loader sales increasing from just $12 million in 1945 to $33 million in 1955.

In 1957, the company had a very impressive showing at the Road Show with a line of six wheel loaders from the 75A to 375A. The company’s wheel loaders had surpassed Hough’s pay-loaders in terms of technological advancement and size.

The company also introduced a three-model line of brand new hydraulic wheel tractor scrapers and line of wheel bulldozers that were straight frame machines with rear-wheel steering and directly derived from its three largest wheel loaders.

In 1962, Clark introduced upgrades in its Series II models. The machines had more horsepower and larger bucket capacities but remained straight frames with rear wheel steering. It lost some of its competitive edge over Hough as the industry was just starting to convert over to articulated frames.

One distinction about Clark as a manufacturer of earth-moving machinery was that the company only produced wheeled machines. This wasn’t always to their competitive advantage, as the construction industry did not buy into the “all rubber” concept. In soft surface applications, a wheeled bulldozer would have had to be 50 percent heavier to have equal pushing power than a bulldozer with tracks and the same amount of horsepower. To compensate for this, Clark pushed its wheeled bulldozer as a good “utility” machine ideal for use in sand, gravel, and crushed work applications such as open pit mining.

Expansion of Earthmoving Equipment

Clark wheel loaders were very popular and remained competitive with Hough loaders through the 1950s. However, as the 1960s approached it was becoming obvious that the company’s Michigan brand line of construction equipment was in desperate need of incorporating other earth-moving products. To rectify this, Clark acquired Hancock Scraper, a manufacturer of elevating scrapers; Melroe Co., a developer of small skid steer loaders under the brand name Melroe Bobcat; and Baldwin-Lima-Hamilton (BLH), a maker of power shovels, draglines and cranes, motor graders, and road rollers. The Bobcats rounded out the lower end of the Clark’s wheel loader line. Melroe Bobcats would become a wholly owned subsidiary of Clark by the 1990s. The small skid steer loaders would prove to be a top profit-producer throughout the years.

The company also continued to market and built elevating scrapers under the Hancock brand name until 1972 as the company had pioneered the development of the elevating scraper. The largest of these produced by Clark Michigan was the 310-H 32-yard (29 m) capacity scraper with a 495 hp GM engine.

In 1964, Clark introduced the largest scraper it would ever produce, the Model 410. The scraper was built to directly compete with Caterpillar’s 651 that had appeared on the market two years prior. Clark’s scraper was heavier and had a 44 cubic yard (33 m3) capacity. Sales of the scraper were so poor with only 20 units over six years that it eventually was discontinued.

Large wheel loaders had also found their rightful place by the 1960s in both construction and mining. There was a move in the industry for larger hauling equipment that could handle a much bigger payload and the large wheel loaders appeared to fit the bill nicely. Clark capitalized on this growing trend and developed the 375 and 475 large sized wheel loaders in 1975. It then took a huge step up, introducing the 675 wheel loader. The 675 was specifically designed for use in mining but seemed to miss the mark as it failed to gain the acceptance of the industry, perhaps being a little too ahead of its time.

A Multinational Company

Clark’s current production facilities were not enough to keep up with the company’s growth. In 1975, Clark built a new facility in Asheville, North Carolina, becoming the first construction company to head to the south with the obvious benefit being cheaper labor. Other companies would pack up and follow Clark’s lead in the coming years. By 1973, Clark had broke the $1 billion mark in sales and established plants in the U.K., France, West Germany, Brazil, Argentina, and Australia. The company had also successfully carved out a market niche for its wheel loader with the rock products industry.

The Demise of Clark

By the 1980s, Clark’s sales had been greatly impacted by the recession. Lower priced Japanese imports on equipment also dealt the company a fatal blow in the market of lift trucks. The company was faced with the indisputable fact that it had failed by not diversifying its construction equipment line enough to stay competitive. The only move left to make was scaling back. In 1981 Clark announced complete withdrawal from the motor grader and scraper business.

The company also made another aggressive move when it purchased Euclid from Daimler-Benz in 1984. Clark was the fifth owner of Euclid since 1953. Following the purchase of Euclid, Clark formed a partnership with Volvo BM, a subsidiary of AB Volvo of Sweden, leading to a full merger in 1985 and renaming the company VME with first year sales generating $800 million, with half of that coming from Michigan Euclid. By the time of the merger, Michigan wheel loaders had lost some of their technological lead and were ranked third in sales volume on the market behind Hough and Caterpillar. Many saw the VME merger as mutually equitable deal for two companies wanting to divest their unwanted businesses. The merger marked Clark’s end in the heavy construction equipment business with only the Bobcat line being retained and its lift-truck subsidiary, the Clark Material Handling Co., the automotive components business and 50 percent interest in VME.

Clark credited for having invented the lift truck in 1928 decided to divest that portion of its business in 1992 to Terex Corp. as it was no longer proving to be viable. Further restructuring followed in 1994 when the company sold its Clark Automotive Products Co. subsidiary. Left with only a 50 percent equity interest in VME, and the Bobcat Melroe line, VME was not posting any profits and business continued to be cyclical, a pattern Clark was trying to escape with restructuring. Clark was also not pleased about its lack of control in the joint venture and threatened to take public its share of the venture. In response, Volvo bought out Clark’s existing shares for $573 million officially ending Clark’s forty-year involvement in the wheel loader business. Shortly after, Clark was approached with another offer from Ingersoll Rand. The company purchased all of Clark’s existing shares for $1.5 billion.

The Company Today

Clark Equipment Co. is no longer in existence as a result of its buyout by Volvo and Ingersoll Rand. Clark Material Handling Co., which exists today, was previously the Industrial Truck Division of Clark Equipment Co.

References

http://www.ritchiewiki.com/wiki/index.php/Clark_Equipment_Company