Crown Equipment Corporation

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Crown Equipment Corporation

40 South Washington Street
New Bremen, Ohio 45869
(419) 629-2311
Fax: (419) 629-3762

Private Company
1945 as Crown Controls Corp.
Employees: 5,000
Sales: $610 million (1994 est.)
SICs: 3537 Industrial Trucks, Tractors, & Trailers; 5084 Material Handling Equipment; 3663 Radio & TV Broadcasting Equipment

Crown Equipment Corporation is one of the worlds top ten manufacturers of industrial lift trucks and ranks as Americas top manufacturer of electric narrow-aisle lift trucks. Commonly known as forklifts, these material handlers are critical to virtually every industry. Although Crown wasnt an originator of the industry, the companys award-winning designs have helped drive the evolution of the lift truck from warehouse workhorse to mobile workstation. Crown has emphasized production of electrically-powered materials handlers since the late 1950s, but also continues to manufacture the directional television antennas it has made since the late 1940s. The closely-held company has been owned and led by the Dicke family since its foundation. James F. Dicke II represented the clans third generation of leadership, guiding Crown into its 50th year in 1995. By the early 1990s, the firm also boasted manufacturing plants and marketing operations in Australia, Ireland, Germany, and Mexico, as well as maintaining two factories in the United States.

Crown was formally organized in 1945, but its roots stretch back to the 1920s, when Carl Dicke founded the Pioneer Heat Regulator Company with his brothers, Oscar and Allen. The three Dicke siblings made quite a team: Oscar invented a thermostat for coal-fired home furnaces; Allen, an attorney, patented the concept; and Carl marketed it. When new home construction went bust during the Great Depression, the brothers sold Pioneer to Master Electric, a manufacturer in nearby Dayton. Carl Dicke continued to work as the Pioneer subsidiarys general manager through World War II.

Following a two-year, health-related hiatus, Carl, his son Jim, and brother Allen founded Crown Controls Company to market thermostats manufactured by Master Electric Company in 1945. In 1947, Master Electric sold the manufacturing operation back to the family team for $85,000. Unfortunately for the Dickes, however, coal was quickly losing favor as a home heating fuel, giving way to electric heaters and natural gas furnaces.

With this core business slipping away, the Dickes sought a new business interest on which to build Crowns future. On a hint from a business associate, they began producing and marketing television antenna rotators in 1949. These devices, also known as directional antennas, turned television antennas so that they would get the best possible reception. In 1950, Allen Dicke traded his stake in Crown to Carl in exchange for Carls share of a local farm.

Crown Controls reached a tragic turning point in 1952, when 50-year-old founder Carl Dicke died, leaving his 31-year-old son to manage the business on his own. Jim Dickes company continued to manufacture television antennas throughout the 1950s (and into the 1990s, in fact), turning marketing responsibilities over to the worlds largest manufacturer of television antennas, New Yorks Channel Master Corporation, in 1957. Channel Masters superior distribution generated increased sales of Crowns TV antennas, but left a void in the Ohio companys marketing program. Crown cast about for new product ideas, dabbling in a variety of novelty products including ice stoppers to keep the ice in your glass from bumping you in the nose; fishing arrowheads; and a combination saw and drill. Of course, none of these products had the staying power to sustain a growing business.

Then, Jim Dickes father-in-law, Warren Webster, suggested that Crown develop a hydraulic lift table that would make lifting and moving heavy objects easier and safer. Webster wasnt the first to come up with this concept; the lift truck was initially invented in 1918 by Lester Sears of Cleveland, Ohio. His Towmotor launched an industry that was crowded with competitors by the time Crown entered the fray in the 1950s.

But Webster and Dicke thought they had discovered an underexploited and potentially profitable segment of the forklift market. They would build small, walk-behind hand trucks for light industry. Crown had manufactured a hydraulic auto jack called a bumper upper for the Joyce-Cridland company in the postwar era, but didnt find a market for the device. Tom Bidwell, an engineer at Crown, adapted the concept to the LT-500 (500-pound capacity lift truck), a walkie lifter he designed in 1957. This initial entry featured a hand-pumped hydraulic lift and was pushed by hand like a cart.

Crowns E-Z Lift trucks entered a market that was already choked with well-entrenched competitors: Hyster, Clark, Yale, and Caterpillar, to name a few. The company needed an advantage that would differentiate its products from these rivals and win over both distributors and customers. In the early 1960s, Crown hired two young industrial designers, David Smith and Deane Richardson, in the hopes of gaining market leverage through superior design. In 1963, the Industrial Designers Institute awarded the resulting hand-controlled pallet truck Crowns first national Design Excellence Award. It was the beginning of a relationship that would last through the early 1990s. Although the design firm remained a separate business entity, it would continue to participate in the development of virtually every materials handler in Crowns continuously expanding line. By 1994, these products had accumulated 25 major design awards.

Those honors, and the features and benefits they recognized, helped Crown garner a growing roster of customers. The companys own distribution and service network grew to include more than 20 locations in the United States and over 100 independent dealerships.

Throughout the 1960s and 1970s, Crown continuously expanded the power, capacity, and capabilities of its materials handlers. Although internal combustion engines dominated the lift truck industry from its inception, Crown concentrated exclusively on production of electric vehicles. The company added rider trucksincluding the industrys first side-stance model during the 1970s, and earned its first national account with the development of a stockpicking truck.

During the 1980s, Crown introduced narrow-aisle reach trucks designed by Richardson/Smith that reduced the distance these handlers needed to maneuver between shelves in warehouses by at least one-third. The company extended this line with the launch of the TSP series of turret stockpickers, combining narrow-aisle capabilities with reaches as high as 45 feet. Narrower aisles meant customers could squeeze more rows of shelves in their storage facilities, and higher reaches meant those shelves could tower ever higher, effecting more efficient use of space and cost savings for Crown clients. The innovation won a Design Excellence Award from the Industrial Designers Society in 1981 and was selected as the Design of the Decade by that group in 1989.

Like so many other industries, from autos to electronics, the lift truck market was assaulted by competition from Japanese companies in the 1980s. American firms controlling stake in the domestic market began to melt away under the onslaught. From 1980 to 1983 alone, Japanese imports priced up to 25 percent less than domestic trucks seized one-third of the U.S. market. By mid-decade, America was a net importer of forklifts. Although the U.S. government later determined that many of these foreign rivals were guilty of dumpingselling goods below fair market value in order to capture market sharethe damage was already done.

While many domestic manufacturers met the competition by moving production capacity (and with it thousands of U.S. jobs) overseas, Crown continued to manufacture about 85 percent of its components domestically. More than national pride was behind this policy. According to a 1992 Design News article, Crown considered vertical integration vital to maintain fidelity to its designs and manufacturing quality. Instead of outsourcing, the company accomplished virtually everything, from forming sheet metal and plastic parts to designing and manufacturing circuit boards for electronic controls, in its own plants. Crown even built a factory in New Knoxville, Ohio, to produce electric motors. The company also avoided the merger and acquisition trend that swept the forklift industry in the late 1980s and early 1990s.

Just as it had in the late 1950s and early 1960s, Crowns design prowess helped it break into another segment of the intensely competitive lift truck industry, counter-balanced lift trucks. Launched in 1990, Crowns FC line of vehicles offered advanced ergonomics that improved comfort and efficiency, including tilt steering; adjustable seating; fingertip controls; onboard diagnostics; and more. Called Crowns most ambitious development effort in 35 years, the FC series won three important design awards and, more importantly, captured market share.

Crowns concentration on development and production of electrically-powered lift trucks also proved providential. Electric forklifts overtook internal combustion engined models in 1979, and continued to hold a slight lead through the early 1990s. Advantages such as quieter operation, cheaper maintenance and repair, and longer working life helped draw customers from the internal combustion segment. Increasingly stringent emission regulations and general environmental concerns also helped drive the shift toward electric-powered lift trucks.

To offset the notoriously cyclicalone analyst even characterized it as rollercoaster-likenature of the lift truck market, Crown established overseas manufacturing, distribution, and sales operations in Australia, England, Ireland, Germany, and Mexico. Increased housing starts, low interest rates, and pent-up demand were cited as the impetus behind rising sales in 1992, 1993 and 1994, when the industry recovered from downturns in 1990 and 1991. Industry analyst The Freedonia Group (Cleveland) forecast that the United States lift truck industrys rally would continue, growing to $1.8 billion by 1997. While Crown remained privately and closely held in the mid-1990s, it seemed apparent that the companys emphasis on forward-looking design, vertical integration, and globalization would enable it to remain independent indefinitely.

Further Reading

A very, Susan, Lift Trucks: The Competition Heats Up, Purchasing, February 7. 1991, p. 58.

_____. Design Updates Lift Trucks to New Heights, Purchasing, August 19, 1993, p. 85.

Basic Handlers: Pallet Trucks, Walkie Stacker and Reach Trucks, Modern Materials Handling, February 1994, p. 54.

Bigger, Better, Faster, More!, Beverage World, August 1993, p. 85.

Dicke, James F., II, Crown Equipment Corporation: A Story of People and Growth, New York: Newcomen Society, 1995.

Lift Truck Market Picks Up Speed, Purchasing, September 8, 1994, pp. 34-39.

Maloney, Lawrence D., Crown Puts Design on a Pedestal, Design News, July 20, 1992, p. 46.

Martin, James D., One-Stop Shopping, Chiltons Distribution, March 1988, p. 90.

McGaffigan, James, What Narrow Aisle Lift Trucks Can Do for You, Handling & Shipping Management, March 1984, p. 50.

Petreycik. Richard M., Forklift Report: Changing Gears. U.S. Distribution Journal, September 15, 1993, p. 47.

Rohan, M. Thomas, Making Em Overseas, Industry Week, December 12, 1983, p. 28.

Sears, Warren, Our Friend the Forklift, Beverage World, April 1995, p. S24.

Weiss, Barbara, Crown Controls to Build New $6M Forklift Plant, American Metal Market, June 9, 1986, p. 12.

Yengst, Charles R., Where Have We Seen This Before? Diesel Progress Engines & Drives, January 1991, p. 4.

April Dougal Gasbarre