Bundy Corporation History
Warren, Michigan 48090-2001
Telephone: (810) 758-4511
Fax: (810) 758-5167
Incorporated: 1922 as Harry Bundy and Company
Sales: £718 million
SICs: 3714 Motor Vehicle Parts and Accessories; 3585 Condensers and Condensing Units; 3317 Steel Pipe and Tubes; 3498 Fabricated Pipe and Fittings
The company's mission is to maintain a leadership position by providing consistent profitable growth as an integrated manufacturer of fluid carrying systems in global niche markets. The Bundy philosophy is the same throughout our worldwide network: "Commitment to excellence and dedication to providing an assured supply of critical automotive components to meet our customers' requirements."
Bundy Corporation is a subsidiary of the London-based specialized engineering group TI Group plc and a world leader in the design, engineering, and manufacture of small-diameter fluid-carrying systems for the automotive and refrigeration industries (two-thirds and one-third of total Bundy revenues, respectively). Among a wide range of specialized tubing products, Bundy supplies preassembled, integrated brake and fuel tubing bundles for direct, assembly-line installation in car making plants. Bundy's automotive tubing products are also used in transmission lubrication, power steering, cooling, emissions, suspension, and air conditioning systems. Bundy's refrigeration tubing products are used in condensers, evaporators, compressors, and other heating, air conditioning, and industrial applications.
In 1995, the Bundy division of TI Group, which accounted for 42 percent of TI's total sales, operated 73 facilities in 27 countries worldwide. Among Bundy's major automotive customers in the early 1990s were Nissan, Ford, General Motors, Volkswagen, Audi, Volvo, Toyota, BMW, Renault, and Jaguar. In North America alone Bundy supplied products for over eleven million cars and trucks and in 1995 was ranked as the second-largest steel pipe and tube manufacturer in the United States.
Building a Niche: 1922-41
The Bundy Corporation was founded as Harry Bundy and Company in Detroit, Michigan, in 1922 by Harry Warren Bundy, a former mechanic with Detroit Steel Products. Established as a manufacturer of steel tubes used in automobile gas lines, Bundy's first contract was to supply tubing for the Ford Model T, which in 1920 accounted for roughly half the cars on the road worldwide. Bundy's innovation was a tube crafted out of a single strip of steel, which was wound around twice to create a double wall capable of withstanding pressure of six thousand pounds per square inch. At first, Bundy simply sold the straight tubes to Ford whose workers then bent the product to conform to the Model T's chassis. During the initial bending process at Ford, however, the soldered seams of Bundy's tubes broke open, rendering them useless, and Bundy was forced to rethink his design or risk losing the contract.
With the help of his toolmakers, Bundy invented bending machines that could shape the tubes without bursting the seams. This early attempt at "adding value" transformed the auto industry supply business, and by 1923 Bundy had sold 3.5 million feet of tube, and Bundy tubes became the industry standard for automotive steel tubing. Within two years, Bundy moved his operations to the second floor of a manufacturing plant on Bellevue Avenue in Detroit and began selling tubing to the emerging refrigeration industry.
When Harry Bundy's health began to fail in 1926, he sold a three-year option to buy the company, whose assets now totaled $143,000, to Wendell Anderson, a 28-year-old graduate of Yale University. In February 1929, Anderson assumed control of the company (renamed Bundy Tubing Company) and its patents and retained Harry Bundy as the company's advisor. Later that year, Bundy's engineers invented the "Bundyweld" tube, a double-walled steel automotive tube that used brazed copper rather than solder to join the tubes' seams. The result was enhanced torsion and bending qualities, increased resistance to corrosion, and improved fatigue strength. Aided by the rapid development of new automotive applications for its tubing--including hydraulic brakes--Bundy's sales took off.
In 1929 annual sales of Bundy tubing reached 50 million feet and U.S. auto sales continued to climb, reaching 2.8 million cars in 1930 alone. Bundy expanded its production capability for Bundyweld tubing by installing two cracked natural gas hydrogen welding furnaces. In 1931, it initiated commercial production of Bundyweld tubes, selling 35 million feet of product before the year was out. A year after Harry Bundy's death in 1931, the company installed a semicontinuous, automatic hydrogen welding furnace in its Detroit plant, and by 1933 tubing sales had jumped to more than 75 million feet. In 1934 Bundy moved its operations again, to a plant on Hern Avenue in Detroit, where it established its own research and development laboratory.
Despite the worsening Depression, between 1931 and 1934 Bundy sold 200 million feet of Bundyweld tubing and by 1936 was employing over a thousand people. It entered into its first international venture the same year through a license agreement with Armco International Corporation to produce Bundy tubes in France and England, which were soon joined by Bundy affiliates in Italy and Germany. On the eve of World War II, Bundy began manufacturing its second major product, "Electricweld" tubes, a single-walled variant of the Bundyweld tube.
World War II and After: 1941-59
Although new car production in the United States came to a virtual standstill during World War II, Detroit firms manufactured $30 billion of military hardware between 1942 and 1945, representing 20 percent of total U.S. war production. In 1941 Bundy moved into a new 160,000 square foot plant in the Detroit suburb of Warren and converted its entire manufacturing operations to war production. At the end of the war, Bundy closed its Hern Avenue plant, moved its administrative offices to Jefferson Street in Detroit, and divided its operations into two divisions: its Bundyweld tubing operations and its Electricweld, nickel, and monel (an alloy of nickel and other metals) tubing works. The end of the war unleashed four years of pent-up consumer demand, and by 1949 Bundy tubing was being used in such consumer products as umbrellas, toys, steam irons, television antennas, and cribs. By 1950, Bundy had expanded into the manufacture of tubes for the radiant heating equipment industry and announced the sale of its one millionth TV antenna.
In 1947, Anderson's announcement of a new "Cost Savings Sharing Plan" was hailed by the national media as an innovative new trend in U.S. industry, and within a year Bundy had erected a new manufacturing plant in Tamaqua, Pennsylvania. In 1948 Anderson embarked on a round-the-world tour with his son John Anderson II to scout out sites for new international ventures. Visiting Australia, New Zealand, Java, South Africa, and South America, Anderson's expedition ultimately led to the establishment of new Bundy subsidiaries in Australia in 1952, Brazil and Argentina in the 1950s, and Colombia and Mexico in the 1960s. A joint venture with the Usui company of Japan in 1959 inaugurated a Bundy presence in the Far East that by the 1990s would rank as one of its fastest-growing markets.
A year after Bundyweld tubes were first produced in Australia (1954), production in the U.S. auto industry had reached the record-setting level of nine million cars per year. Happily riding the postwar automotive boom, Bundy expanded its Pennsylvania plant in 1956 and enlarged its main Warren, Michigan, plant a year later. When Wendell Anderson Sr. died in October 1959 after three decades as Bundy's president, his 34-year-old son Wendell Jr. assumed the company's reins, and John Anderson II was named executive vice-president of international operations.
Shortly after assuming his father's title, Wendell Jr. bought out the Lionel Corporation's share in a marine outboard motor project being developed by Italy's Innocenti Corporation. Explaining the venture to Business Week years later, Anderson admitted that "we'd been looking for several years for diversified firms outside our line." In the early 1960s Bundy Marine U.S.A and a new Italian subsidiary, Bundy Marine S.p.A., were thus formed to produce Bundy's outboard engine for the U.S. and European pleasure-boating market.
The unusual move reflected Anderson's growing concern over Bundy's reliance on steel tube manufacturing, which was at the mercy of the feast-or-famine cycles of the world auto industry. That Bundy's earnings had grown 53 percent from 1959 to the mid-1960s made its dependence on a single niche, in Anderson's eyes, no less dangerous. Nevertheless, between 1960 and 1965, Bundy engineers applied the company's Electricweld tubing manufacturing process to the development of automotive push rods (used to operate the valves in internal combustion engines), which culminated in the construction of a push rod manufacturing facility in Kentucky in 1965. By mid-decade, Bundy's sales had broken the $30 million threshold, its share of the automotive steel tubing market had ballooned to 70 percent, and its total workforce numbered 1,600 persons producing 815 million feet of tubing per year. But acquisition feelers from two larger companies convinced Anderson that Bundy had to diversify again to protect itself from takeover. As he told Forbes magazine in 1968, "our tubing had penetrated the automobile and refrigeration markets as far as we could expect. In the future we would be dependent on the growth of these industries for our growth. We decided that wasn't sufficient.... We decided we wanted to remain independent. At the same time we became quite aware that if we wanted to maintain our growth rate, we would have to move into new products."
In 1967 Bundy therefore moved to definitively establish itself as a multiproduct specialty metals company with the door left open for expansion into plastics and rubber. It dropped "Tubing" from its name in favor of "Bundy Corporation" and acquired National Rolling Mills Company of Pennsylvania, a specialty strip steel producer with sales of $15 million. Following a public stock offering, Bundy's sales rose to more than $60 million in 1968. Throughout the late 1960s and early 1970s, Bundy expanded its position in the international tubing market. It unveiled Bundy New Zealand in 1967, repositioned Bundy of Canada from the international division to divisional status within Bundy Corporation in 1970, merged its Bundy Brazil subsidiary with Bendix Home Appliance do Brazil in 1971, formed Bundy Pacific Tubing (Philippines) Inc. in 1972, acquired 25 percent of Armco-Bundy RoR, A.B., of Sweden in 1973, and reached an agreement with Tubemakers of Australia to spin off Bundy Australia into an independent subsidiary in 1974.
Closer to home, a new headquarters for Bundy Tubing Division was begun in 1969, and a New Business Development Group was founded to pursue such technologies as powder metallurgy (culminating in the creation of the short-lived Metallurgical Products Division in 1970). The passage of the Clean Air Act in 1970 signaled Congress's intent to address the growing problem of auto emissions by forcing U.S. automakers to use more specialized tubing--a niche Bundy was now well positioned to exploit. With evaporative emission control systems now mandated by federal law, sales of Bundy's stainless steel automotive tubing took off, and Bundy expanded plant capacity in Canada; built a new automotive brake tube plant in Coldwater, Michigan; acquired engineered plastic products maker Dixon Industries of Rhode Island; opened a new facility in Mt. Clemens, Michigan; and unveiled a new copper-coating plant in Warren.
In 1974, Anderson announced a new corporate strategy designed to move Bundy from its historical basic tubing "commodity product" niche to the increasingly promising "specialty product" market represented by such high-tech products as its automotive emission control tubing systems. The new strategy led to the sale of National Rolling Mills in May 1974, and in the following year Bundy continued its globalization campaign. It launched Bundy South Africa and Bundy India in mid-decade; secured contracts in Iran and Indonesia in 1978; and formed a joint venture with its Australian and Japanese partners and the Korean Pusan Steel Pipe Company in 1979 to create Pusan Bundy Corporation (Korea). A shaky U.S. economy and the effects of the Arab oil embargo meanwhile led to new federal fuel economy legislation that bolstered sales of fuel-efficient compact cars. Again, Bundy benefited: its North American tubing operations won a substantial portion of the automotive fuel injection tubing business for diesel engines, making Bundy the largest tube supplier for domestic automotive diesel engines by 1980. With sales passing $112 million, Bundy moved into aircraft tubing manufacture in 1978 with the acquisition of Dixon Industries' Titeflex Corporation, built a tubing plant for its refrigeration operations in Arkansas, and established a new tube making facility in Hillsdale, Michigan, in 1979.
The stagflation and continuing energy crisis of the late 1970s, however, battered company profits, and Bundy was forced to close its Tamaqua, Pennsylvania, plant in 1980 and its Penntube (Dixon) plant three years later. But its prowess in bringing new technologies to market continued to augur well for its future: a new "Z-Coat" manufacturing process for Bundyweld and Electricweld automotive tubing, for example, was unveiled in 1980 and during a Japanese tour in 1981 Bundy's Thomas Lauterbach discovered the growing use among Japanese manufacturers of "bundling" technology, in which automotive parts such as fuel systems and brake lines&mdash′eviously manufactured as separate components--were produced as integrated units for direct installation on the assembly line. Bundy recognized the revolutionary ramifications of the concept, and by 1985 it was selling preassembled tubing bundles manufactured at its Georgia plant.
Strategic acquisitions further bolstered Bundy's long-term prospects. In 1981 it consolidated the newly acquired Bivco Valve Company with its Titeflex subsidiary (which was soon producing hoses for the B-1 bomber, the M-1 tank, and the cruise missile); purchased Bunnell Plastics Inc. of New Jersey, a manufacturer of fluoropolymer-based piping systems and engineered components; and acquired E. I. DuPont de Nemour's product line in 1985 and CHR Industries a year later. New tube bundle manufacturing plants in Georgia, Indiana, and Ohio were unveiled between 1983 and 1986, and in 1983 Bundy consolidated its Dixon, Bunnell, and Titeflex into a new division, Performance Plastics, to complement its Specialty Tubing operations. Internationally, Bundy launched its second Japanese joint venture, DIC-Bundy, in 1984 and in 1986 began supplying tubing to the U.S. plants of Japanese automakers through a joint venture with Bundy-Usui International. Before the year was out it had acquired Bundy Tubing do Brasil and formed Hua Yan Bundy in the untapped megamarket of mainland China.
TI Group: 1988-96
The takeover that Bundy had feared since the 1960s finally arrived in March 1988 when the British specialized engineering firm TI Group plc announced its acquisition of Bundy for $146.5 million. Two years earlier, Sir Christopher Lewinton had been enlisted as TI's new CEO to transform what one journalist called "an aging four-legged metalbasher standing on just one good leg" into a high-tech international engineering dreadnought. Lewinton had immediately begun searching for technology-driven, market-leading acquisition targets, and Bundy fit the bill nicely. TI quickly dispatched Bundy's Performance Plastics Group (except Titeflex) and merged Bundy Corporation and its foreign subsidiaries with TI's smaller engineering firms to form Bundy International, now headquartered in TI's corporate offices in Abingdon, England.
With John W. Potter appointed Bundy's new CEO in 1990, Bundy could focus anew on the changing realities of the auto making business. The auto and auto parts industries had become increasingly global in scope, and radical changes in labor use, technology, governmental regulation, and engineering and manufacturing approaches had revolutionized the industries almost overnight. Automakers were increasingly turning to an ever smaller core of principal suppliers whom they relied on to assume an ever more integral role in the car manufacturing process. Bundy's historically central role in producing critical auto components, its global spread, and its rapid embrace of new technologies left it well prepared to become a major "one-stop, one-source" supplier for the new world auto industry.
By 1992, Bundy's sales (including TI's smaller engineering businesses) had grown to £492.8 million, and, newly energized by TI's aggressive corporate growth strategy, it returned to the globalization plan it had followed in the 1980s. In 1993, it acquired Bundy Venezolana (Venezuela), opened an automotive tubing facility in the Czech Republic, and established a liaison office in Turkey. Its refrigeration segment secured a contract for Goldstar's Italian refrigerator condenser operations, and in the United States Bundy won a major contract to supply all the tubing needs of General Electric's condenser production operations. The introduction of so-called satellite assembly plants in France and Germany enabled Bundy to supply Renault and Volkswagen, respectively, with tubing components as they were needed on the assembly line. Moreover, Bundy engineers were now actually stationed in customers' plants to ensure that Bundy tubing systems met customers' needs. TI's 1991 acquisition of Huron Products of Ohio and its QuickConnects products also dovetailed neatly with Bundy's efforts to improve its tubing line: QuickConnects allowed fuel or coolant lines to be simply and securely snapped together without the limitations of traditional threaded connector fittings. By 1993 TI and Bundy were implementing the QuickConnects technology in its automotive systems plants around the world.
Bundy's affiliation with TI paid off again in 1994 with the acquisition of Technoflow GmbH, a German manufacturer of fuel-carrying hoses and systems, and Arktis, a Hungarian maker of refrigeration condensers. TI's investment in a second Brazilian tubing plant in Brazil and new automotive satellite plants in Europe enabled Bundy to boast a 14 percent growth rate in 1994. The introduction of a new high-performance aluminized, nylon-coated steel tube for the automotive market and a patented "Galfan" anti-corrosion coating further secured Bundy's claim to be the new technology leader of the global tubing industry. In August 1994, Bill Laule, a former executive with Rockwell International, was promoted from the presidency of Bundy North America to CEO of TI's international Bundy division, and Bundy won contracts to supply new BMW and Mercedes plants in the United States. In the Far East, Bundy landed the tubing supply business for Daewoo in Korea and pursued a contract to supply Peugeot and Citroën plants in mainland China.
Bundy's sales increased another ten percent in 1995, spurred by the formation of a joint venture with Tubemakers of Australia to create Bundy Asia Pacific (bought outright by TI a year later), the announcement of an agreement with Volkswagen to supply the brake line components for its new A4 vehicle, and a major contract with Ford to supply the brake, fuel, and transmission line systems for its new rear-drive luxury car project. New satellite tubing plants in Germany, Spain, the United Kingdom, Brazil, and Tennessee extended Bundy's global reach; a major condenser supply contract gave Bundy all of Daewoo's North American refrigeration business; and large refrigeration contracts were signed with customers in Hungary, Slovakia, and Lithuania.
Although Bundy's transformation from a basic producer of steel commodity tubes to a defiantly high-tech supplier of sophisticated tubing "systems," "clusters," and "bundles" rendered its historical link to Harry Bundy's original company almost unrecognizable, in January 1996 TI acknowledged the continuing importance of the Motor City in the world auto industry by transferring the offices of Bundy CEO Bill Laule from Abingdon, England, back to Detroit.
Principal Subsidiaries: Bundy of Canada Ltd.; Bundy Argentina SA; Bundy Brazil; Bundy Colombia; Bundy Mexico SA; Bundy Venezolana CA (Venezuela); Bundy UK Ltd.; Bundy SA (Belgium); Bundy Danmark A/S (Denmark); Bundy SNC (France); Bundy GmbH (Germany); Bundy Kft (Hungary); Bundy SpA (Italy); Bundy SA (Spain); Bundy AB (Sweden); Bundy Tubing Co. (Australia) Pty Ltd.; Foshan Hua Nan Bundy Tubing Co. Ltd. (China); Hua Yan Bundy Tubing Corp. (China); Bundy India Ltd. (India); Bundy Japan Ltd. (Japan); Usui Bundy Tubing Ltd. (Japan); Bundy Tubing (New Zealand) Ltd.; Bundy Systems Ltd. (South Korea).
- "A Two-Price Bid to Force a Merger," Business Week, February 27, 1978, pp. 35-36.
- "British Firm Buys Bundy," Chicago Tribune, March 9, 1988.
- "Same Players, New Game," Forbes, April 15, 1968, p. 70.
- "Tube Maker Launches a Boating Venture," Business Week, January 21, 1961, pp. 30-32.
- Willoughby, N. C. Dylan, "The History of Bundy Tubing Company and Bundy Corporation, 1922-87" (company chronology), Warren, Mich.: Bundy Corporation, June 1996.
Source: International Directory of Company Histories, Vol. 17. St. James Press, 1997.comments powered by Disqus