Galley Maker Enters a New Era : Van Nuys: With the death of its founder and chief, Nordskog Industries seeks to maintain its strong standing in a business facing turbulence.
From the day he started Nordskog Industries in 1951 with a few machines in a Quonset hut, Robert Nordskog ran the Van Nuys maker of airline galleys with as much passion and drive as he raced powerboats. The champion racer was known as a one-man show at his company. “I’m the head honcho, a dictator,” he would say, bluntly and without hesitation.
Now, with Nordskog’s death two weeks ago at age 79, competitors and observers are wondering whether Nordskog Industries can remain strong without its dynamic leader. It’s an especially delicate time because declining airline orders and increasing foreign competition are making life harder for domestic manufacturers of galleys, or in-flight food-service equipment.
“Bob was a one-man gang, he was very important to the company,” said Michael Hanks, a longtime acquaintance of Nordskog’s and president of 4 Flight Industries, a galley maker in Valencia. Rudy Pecoraro, vice president at Weber Aircraft Inc., a leading Nordskog competitor in Fullerton, said Nordskog Industries is now primed to be sold. “All of us are interested in buying it or at least getting closer to it.”
But Elly Nordskog, who was married to Nordskog for 54 years and assumed control of the 400-employee operation as chairman and chief executive officer after his death, said she planned no major changes. “My plans are to continue exactly as we were doing,” she said.
Nordskog’s president, C. Wade Worley, conceded that the declining industry will present a formidable challenge. But he said the company has had no recent cancellations and maintains a sufficient backlog of orders to enable it to remain profitable this year. And with a new management team trained and securely in place, Worley believes that the company will maintain its stature in the industry.
Although Elly Nordskog was for many years her late husband’s secretary and involved closely with the company’s affairs, she won’t be involved in the day-to-day operations of the privately held company. That will be left mostly to Worley, who is Nordskog’s successor.
Worley, 46, has been preparing for the role since December, 1990, when Nordskog summoned Worley into his office and solemnly read a two-page letter that amounted to Nordskog’s succession plan. It was a move Nordskog had put off as long as he could, many said, not only because he found it hard to relinquish control but also because of the difficulties of choosing a successor. In picking Worley, a marketing executive who has been with Nordskog for 18 years, Nordskog passed up several senior executives who had been with the company longer, including Noel Younger, a 32-year employee, and his only son, Jerry.
Jerry Nordskog, 54, is vice chairman of Nordskog Industries, and he heads four of the five operating units of the company, including the Electrical Vehicle Division, which makes industrial carts, and the division that publishes Powerboat Magazine, a 40,000-circulation monthly. But those four units make up just 20% of Nordskog Industries’ sales.
Nordskog’s total sales are estimated to be about $50 million--a figure Jerry Nordskog said was in the “right ballpark,” although slightly high given its recent decline in revenue. Company officials declined to discuss financial results, except to say the company was profitable and free of debt.
Nordskog’s primary unit is Nordskog Co., which makes galleys and other kitchen systems for the airline industry. Worley said its 32 customers include Boeing Corp. and numerous domestic and foreign airliners.
Worley acknowledged that Nordskog won’t be the same without its founder, but he said the company has long been a leader in the industry and continues to remain so. “We will expand our product line,” he said, before rattling off a list of what he called industry firsts, among them, fresh-brew coffee machines, refrigeration systems and water purifiers for airline use.
But much has changed since Nordskog developed many of those products. For one thing, it faces more and tougher competition, especially from two foreign galley manufacturers. Jamco of Japan and Sell Aviation of Germany, which recently opened a new plant in Wichita, Kan., combined are thought to have 50% or more of the total worldwide galley market, which Weber’s Pecoraro estimated to be between $400 million and $500 million.
Beyond that, all of the galley makers are in a crunch these days, and are bracing for yet tougher times, because of declining orders for airplanes.
“It’s slow,” said Fuji Masuyama, senior executive vice president of Jamco America in Seattle, the U. S. arm of the Tokyo-based company. “You know, the airlines aren’t buying new aircraft,” Masuyama said.
Frank Finn, senior purchasing manager at American Airlines, agrees. Nonetheless, “we bought the first galley from them in the early 1960s, and I don’t foresee that changing,” he said. “I’ve got a lot of confidence in Wade.”
Worley, a former marketing and sales executive at Anheuser-Busch and Carnation, said his long-term plan is to increase Nordskog’s sales of electric vehicles and its other divisions. And unlike his mentor, Worley says he won’t be tackling these challenges alone.
Robert Nordskog “prided himself in making all of the decisions,” said Worley, a graduate of Hollywood High School and Valley Junior College. “But I have no desire to make all the decisions. It’s going to be a management team.”
