Corporate History: Eaton Corporation

Eaton Corporation has a long and interesting history in the Greater Cleveland area.

In 1911 Joseph O. Eaton (Pictured at left) and Viggo Torbensen started the Torbensen Gear and Axle Company to make an internal-gear rear truck axle that Torbensen had patented in 1902. The company moved from Newark, New Jersey, to Cleveland in 1914. After Republic Motor Truck bought Torbensen (1917), Eaton formed the Eaton Axle Company (1919), repurchased Torbensen (1922), and by 1931 had bought 11 more auto parts businesses. In 1932 it became Eaton Manufacturing.

The Depression flattened auto sales, and Eaton's profits fell. WWII sparked demand that helped the company recover. Joseph Eaton died in 1949. During the 1950s and 1960s, Eaton diversified and expanded geographically. It bought Fuller Manufacturing (truck transmissions, 1958), Dole Valve (1963), and Yale & Towne Manufacturing (locks and forklifts, 1963). Eaton's international business grew, with foreign sales increasing from almost nil in 1961 to 20% of sales by 1966.

Eaton sold its lock business in 1978 and bought Cutler-Hammer (electronics), Kenway (automated storage and retrieval systems), and Samuel Moore (plastics and fluid power). Downturns in the truck and auto industries forced Eaton to close 30 plants and trim 23,000 jobs between 1979 and 1983. The company reported its first loss in 50 years in 1982 and decided to diversify into high technology and to expand operations overseas.

From 1984 to 1993 Eaton spent almost $4 billion in capital improvements and R&D. In 1986 it bought Consolidated Controls (precision instruments), Pacific-Sierra Research (computer and defense systems), and Singer Controls (valves and switches).

Eaton's acquisitions in the 1990s included Nordhauser Ventil (automotive engine valves, Germany), Control Displays (flight-deck equipment), Heinemann Electric (hydraulic-magnetic circuit breakers), and the automotive switch business of Illinois Tool Works. In 1994 Eaton tripled the size of its electrical power and controls operation with its $1.1 billion purchase of Westinghouse's electrical distribution and control business. The next year it bought Emwest Products (electrical switch gear and controls, Australia) and the IKU Group, a Dutch auto-controls firm. It purchased CAPCO Automotive Products (truck transmissions, Brazil) in 1996.

In its repositioning, the company in 1997 sold off its appliance-control business to Siebe PLC and a majority stake in its high-tech defense electronics subsidiary, AIL Systems, to management. The next year Eaton sold its heavy-axle and brake business to Dana and its suspension business to Oxford Automotive. Eaton closed and consolidated plants and laid off more than 1,000 workers in its chip division in 1998.

The company increased its share of the hydraulics market in 1999 by spending $1.7 billion for Aeroquip-Vickers. To help pay for the purchase, Eaton sold its engineered-fasteners business to TransTechnology, its fluid power division (cooling systems for cars and trucks) to Borg-Warner (now BorgWarner), and its mobile agricultural hydraulic cylinder business to Hyco International. Eaton also unloaded Vickers' machine-tool controls business later that year.

In 2000 Eaton sold its specialty power resistor business to industrial products maker Halma. That year its Aeroquip unit acquired the fluid connectors business of Honeywell, and Eaton spun off its Axcelis Technologies subsidiary. As part of its bid to reduce debt, the company sold its automotive electronic switch division and its commercial and residential air-conditioning and refrigeration division, in 2001.

Eaton sold its naval controls unit (shipboard integrated electrical power distribution and control systems) to DRS Technologies for $92 million in 2002. Later in the year Eaton signed a deal with Volvo to manufacture heavy-duty transmissions for the company's South American truck market. Eaton also bought the product lines and the intellectual property of the Aerospace Division of Mechanical Products Inc. In early 2003 the company completed the acquisition of Delta plc's electrical division for a reported $215 million.

In 2004 Eaton acquired Powerware, an uninterruptible power supply and power management system manufacturer, from UK-based Invensys for $560 million. Early in 2005 the company acquired Walterscheid Rohrverbindungstechnik GmbH, the tube connecting systems business of GKN plc, for about $48 million. It also bought the Chinese hydraulic hose fitting maker Winner Group Holdings Ltd.

In 2005, Eaton purchased: Pigozzi S.A. Engrenagens e Transmissões, an agricultural powertrain business located in Caxias do Sul, Brazil, the businesses of Winner Group Holdings Ltd., a China-based company that produces hydraulic hose fittings and adapters for the greater Chinese market, and the Mexican automotive lifter manufacturer Morestana S.A. de C.V.

Photo Credit: Automotive Hall of Fame