Maytag and Hoover: Heaven for Housekeeping and Appliance Makers
When Maytag bought Hoover earlier this year, it was a homemaker’s dream--the marriage of two businesses that started out producing appliances to make housekeeping tasks easier in the early years of this century.
The two are similar in other ways as well.
In 1907, Frederick L. Maytag, owner for many years of a farm implement business in a small Iowa town, began manufacturing the Pastime, a wooden, hand-cranked washing machine.
In 1908, William H. Hoover, owner for many years of a leather goods and harness factory in a small Ohio town, started making the Model O electric suction carpet sweeper.
The Maytag washer and the Hoover vacuum cleaner soon became household words--Maytag in this country, Hoover throughout the world as well. Hoover opened its first foreign plants in Canada in 1911 and in England in 1917.
It was J. Murray Spangler, a cousin of Hoover’s wife, Susan, who invented the Hoover vacuum cleaner. Spangler, a janitor who suffered from asthma, was troubled by dust when he swept carpets.
Models for $450
So he mounted an electric fan on a floor sweeper and twisted the fan’s blades to create suction. He put a pillowcase around the contraption to catch the dust it sucked up. Spangler patented the device and sold the patent to Hoover. Hoover improved on the design and made Spangler the production manager of his new company, Electric Suction Sweeper Co.
The first Hoover vacuum cleaner weighed 40 pounds and sold for $59. Today, the most expensive models sell for about $450. Hoover’s newest machine--the Elite 300 upright--weighs less than 12 pounds.
According to Brian Gridlestone, Hoover North America’s 42-year-old president, Maytag wanted Hoover “because Hoover is one of the world players in the appliance industry.” Maytag paid Chicago Pacific Corp. $961.5 million to acquire the Hoover operation and five furniture companies, although it later said it would sell the furniture companies to pay off part of the long-term debt it assumed as a result of the merger.
Maytag, with record sales of $1.9 billion last year, was looking for a company such as Hoover so it could become a global player, explained Daniel J. Krumm, 62, Maytag’s chairman and chief executive.
“This is particularly important to us,” he said, “because it is our first major step in expanding Maytag’s strategy for appliance growth to overseas markets. Appliance companies here and abroad are actively developing ways to play on each other’s turf.
“We needed to position ourself . . . for the upcoming changes in the European market in 1992, when all trade barriers between countries in Europe are scheduled to be dropped, making Europe an even bigger appliance market than the U.S.”
Hoover, whose sales exceeded $1 billion for the first time last year, is the largest company in the $2.5-billion U.S. floor-care industry through its production of vacuum cleaners and other home products. Overseas, where 69% of its revenues are generated, Hoover is big not only in vacuum cleaners, but also in washers, dryers, refrigerators, dishwashers and microwave ovens.
Microprocessors, Robotics
Hoover has 14 manufacturing facilities in the United States and abroad with a total of 15,100 employees, including 3,000 at its headquarters and factory here. It also has factories in Scotland, Wales, Canada, Australia, France, Mexico, Portugal and Colombia.
Hoover’s North Canton plant has undergone a $38-million modernization during the past two years, with the installation of robotics and microprocessors throughout--part of a $130-million improvement program that Hoover has conducted at its plants throughout the world during the past five years.
Maytag, based in Newton, Iowa, had 13,000 employees in 12 U.S. divisions before the merger on Jan. 26. The Maytag companies now are Admiral, Ardac, Dixie-Narco, Domicor, Heatube, Hoover, Jenn-Air, Magic-Chef, Maycor, Maytag, Maytag Financial Services, Norge and Warwick.
Maytag is the nation’s third-largest washing machine company--after Whirlpool and General Electric. Other Maytag products include refrigerators, clothes dryers, kitchen ranges, soft drink vending machines and garbage disposals.
Hoover and Maytag pride themselves on their ability to make high-quality products for reasonable prices, which has helped keep Japan and other foreign nations from getting a foothold in the highly competitive American appliance marketplace.
