American Machine and Foundry

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American Machine and Foundry
AMF
Private
Successor
Founded Brooklyn, United States 1900 (1900)
Founder Rufus L. Patterson
Headquarters Mechanicsville, Virginia, United States
Website amf.com

American Machine and Foundry (known after 1970 as AMF, Inc.) was once one of the largest recreational equipment companies in the United States.

The company was founded in 1900 by Rufus L. Patterson, inventor of the first automated cigarette manufacturing machine. Originally incorporated in New Jersey but operating in Brooklyn, the company began by manufacturing cigarette, baking, and stitching machines.[3] AMF moved into the bowling business after World War II, when AMF automated bowling equipment and bowling centers became profitable business ventures. Bicycle production was added in 1950. The company was once a major diversified manufacturer of everything from tennis racquets to research reactors for the US' "Atoms for Peace" program.[4] AMF became a major part of what would soon be called by US President Dwight D. Eisenhower as "the military-industrial complex" after WWII.

In the late 1950s, the company's vice-chairman was Walter Bedell Smith. He was a formerly a US major general, Eisenhower's wartime chief-of-staff, and Harry Truman's Ambassador to the Soviet Union. He later became the fourth Director of the Central Intelligence Agency.

Until the mid-1980s, AMF's range of consumer goods included powered model airplanes, snow skis, lawn and garden equipment, Ben Hogan golf clubs, Voit inflatable balls, exercycles and exercise equipment, Hatteras yachts, Alcort sailboats, Nimble bicycles, motorized bicycles, mopeds, and SCUBA gear. For a time, AMF owned Harley-Davidson motorcycles. Aging production facilities and increasing quality control problems in some product lines caused sales declines in the late 1970s and early 1980s. The company's vast diversified output proved difficult to efficiently manage, and after suffering a series of losses, the company began to sell off most of its manufacturing operations.

Bowling centers and nuclear reactors

In 1943, Rufus Patterson's son, Morehead Patterson, took over AMF. After WWII ended, Patterson determined that the company had to 'grow or die'.[3] One of AMF's post-WWII ventures was "AMF Atomics": a division that made "low-dose irradiation equipment" for "the US Army Quartermaster Corps’ bulk-food irradiation program".[5] In a masterstroke of top executive recruitment, Patterson hired top US government Cold Warrior Walter Bedell Smith, whose leadership positions at the Pentagon, US State Department and CIA made AMF one of the pillars of the US' military-industrial complex during the 1950s and 1960s. AMF Atomics got Israel's nuclear weapons program off to a start in the late 1950s when the company "won" the contract for designing and constructing "a small 1 MW swimming pool-type reactor" at Soreq, Israel.[4]

Patterson encountered a prototype of an automatic bowling-pin setter. To get the cash to develop the invention, Patterson swapped AMF stock to acquire eight small companies with fast-selling products. After incorporating key features developed by Leslie L. LeVeque, the AMF Pinspotter, perfected and put on the market in 1951, helped to turn bowling into the most popular US participative, competitive sport.[3][6]

Commonwealth Ventures, a group of private investors in Richmond, Virginia, paid $225 million to purchase AMF's bowling division in 1985 to form AMF Bowling Companies, Inc. (later known as AMF Bowling Worldwide).[7] The division operated AMF Bowling Centers, and manufactured bowling pins and lanes at its plant in Lowville, New York and related equipment at its plant in Shelby, Ohio. The new owners sought to reverse $7 million in losses suffered in 1986 at the two plants and to make the company competitive by reducing expenses $10 million and laying off 172 salaried non-bargaining unit employees. A few months before Commonwealth acquired the bowling division, a 24% wage cut and 14% benefit cut had been negotiated for the employees at the Shelby plant. In 1988 however, AMF Bowling closed the Shelby, Ohio facility that had operated since the 1950s.

The new owners also spent nearly $500 million to revitalize the bowling center business, and by 1995, the company became the largest owner of bowling centers in the US.[7][8] In 1996, Goldman Sachs paid $1.4 billion to buy out the company from Commonwealth Ventures. The company’s strategy at the time was to acquire additional bowling center properties and clean them up, with the goal of creating a national chain of amusement complexes.[7][9] For additional detail about the expansion (and subsequent contraction) of the bowling center division, see AMF Bowling Centers.

AMF Bowling went public when it was listed on the New York Stock Exchange in November 1997. In 1998, its stock price plummeted as losses mounted, and expansion plans were put on hold. In 1999, the decision was made to downsize. By 2000, the company was more than $1 billion in debt and it was delisted.[7][10]

AMF Bowling entered Chapter 11 bankruptcy for the first time in April 2001. Code Hennessy & Simmons bought the company in 2004 for $670 million to bring it out of bankruptcy.[11]

In 2005, AMF Bowling's products division and Italian-based Qubica Worldwide formed a 50/50 joint venture, QubicaAMF Worldwide. The partnership combined Qubica's expertise in automatic scoring technology and AMF Bowling's technology in lane equipment and pinsetters.[12]

In 2007, a new company, 900 Global, purchased the rights to sell bowling balls with the AMF logo.[13] (In February 2014, the principals of bowling ball manufacturer Storm Products, Inc. made a significant investment in 900 Global).[14]

AMF Bowling went into Chapter 11 bankruptcy for the second time in November 2012. In its filing the company said there had been a 36 percent decline in league memberships since 1998 and that it had been unsuccessful in selling assets.[11][15]

In 2013, AMF Bowling was brought out of bankruptcy through its merger with Strike Holdings LLC (doing business as the bowling center operator Bowlmor), bringing the 50% interest in the QuibicaAMF joint venture and the remaining US and Mexico bowling centers under the control of Bowlmor AMF.[16]

Bicycle production

In 1950, after purchasing the Roadmaster line of children's and youth bicycles from the Cleveland Welding Company, American Machine and Foundry entered the bicycle manufacturing business with its newly formed AMF Wheel Goods Division. In 1953, after a prolonged labor strike, AMF moved bicycle manufacturing from a UAW-organized plant in Cleveland, Ohio to a new facility in Little Rock, Arkansas.[17] The new plant was heavily automated and featured more than a mile of part conveyor belts in six separate systems, including an electrostatic induction painting operation.[18]

Taking advantage of the increase in its target markets in the aftermath of the baby boom, AMF was able to diversify its product line, adding exercise equipment under the brand name Vitamaster in 1950. As demand for bicycles continued to expand, the company needed a new manufacturing facility to keep up with demand. In 1962, the company moved its operations to Olney, Illinois, where it built a new factory on a 122-acre (0.49 km2) site that would remain the company's principal bicycle manufacturing location into the 1990s.

After two decades of consistent growth, the AMF Wheel Goods Division stalled under the long-distance management of a parent company bogged down in layers of corporate management and marginally profitable product lines. Manufacturing quality as well as the technical standard of the Roadmaster bicycle line - once the pride of the company - had fallen to an all-time low. Bicycles made at the Olney plant were manufactured so poorly that some Midwestern bike shops refused to repair them, claiming that the bikes would not stay fixed no matter how much labor and effort was put into them.[19] The division's problems with quality and outside competition were neatly summed up in a 1979 American film, Breaking Away, in which identical secondhand AMF Roadmaster track bicycles were used by competitors in the Little 500 bicycle race. Despite this product placement, the film's protagonist expressed a decided preference for his lightweight Italian Masi road racing bike, deriding the elderly Roadmaster as a 'piece of junk'.[20]

In 1997, the Roadmaster bicycle division was sold to the Brunswick Corporation. However, it had already become evident that production of low-cost, mass-market bicycles in the US was not viable in the face of foreign competition,[21] and in 1999, all U.S. production of Roadmaster bicycles ceased. Brunswick sold its bicycle division and the Roadmaster brand to Pacific Cycle, which began distributing a new Roadmaster line of bicycles imported from Taiwan and the People's Republic of China. Pacific Cycle still uses the Olney facility for corporate offices and as a product inventory and distribution center.

New product lines

File:Break in 261 Mad Av from E36 St jeh.jpg
261 Madison Avenue, formerly AMF Building
1975 AMF Harley-Davidson 250
1975 AMF Harley-Davidson 350

In 1949, American Machine and Foundry developed the pretzel bender a new automatic crispy styled baked pretzel-twisting machine that rolled and tied them at the rate of 50 a minute more than twice as fast as skilled hand twisters could make them and conveyed them through the baking and salting process.[22] To expand its line of recreational equipment, AMF bought W. J. Voit Rubber Corp. (tread rubber, scuba gear), Ben Hogan Co. (golfing equipment), and Wen-Mac Corp. (engine-powered toy airplanes).[3]

By 1961, AMF controlled and operated 42 plants and 19 research facilities scattered across 17 countries, producing everything from remote-controlled toy airplanes to ICBM launching systems. AMF was the builder of the launching silos for the Titan and Atlas ICBMs, and also developed the rail-car launching system for the solid-fueled Minuteman missile.

In the late 1950s and early 1960s, the company ran neck-and-neck with General Dynamics in the construction of nuclear power reactors. AMF sold Pakistan and Iran their first nuclear reactors.[3] Peter Karter was among the young engineers working on the reactors AMF built in Pakistan and Iran under the Atoms for Peace program.[23][24][25]

In 1953, company headquarters moved into a newly built International Style office tower at 261 Madison Avenue. Given naming rights, the AMF logo appeared in the Manhattan skyline. The bowling division outgrew the space and moved in 1960 to Long Island (Westbury, New York); corporate headquarters was relocated in 1971 to White Plains, New York.

In the early 1960s, American Machine and Foundry partnered with the French company SAFEGE to design, construct and market a monorail for American cities. The AMF Monorail was exhibited at the 1964 New York World's Fair, where it traversed a continuous elevated loop around the Amusement section of the Fair. It was displayed as a practical form of future transportation.

In 1971, American Machine and Foundry was renamed AMF. For many years, the company continued to produce a wide variety of sport and leisure equipment, including Roadmaster bicycles, Harley-Davidson motorcycles (1969–81), Head snow skis and tennis racquets (1969–85), snowmobiles, lawn and garden equipment, Ben Hogan golf clubs (1960–85), Voit inflatable balls, exercise equipment (including exercycles), motorized bicycles, mopeds, SlickCraft powerboats (1969–80), Alcort sailboats (including the Sunfish and the Hilu; 1969–86), Hatteras Yachts, and SCUBA gear.

In the late 1970s, in a reference to its numerous leisure product lines, the company began a TV advertising campaign centered on the slogan "AMF, we make weekends". For a short time, the company owned Dewalt Tools (1949–60), and manufactured gymnastics equipment under the AMF brand. The gymnastics division was later spun off to form American Athletic (AAI) which used the same logo as AMF but with different text. New and improved exercycles, such as the Computrim line, the first to incorporate an electronic heart monitor, were introduced. AMF also acquired a recreational motor home division in the form of Atlas Recreational Vehicles of Mason City, Iowa, which was disbanded after heavy losses following the fuel crisis of the early 1970s.

Decline

By the late 1970s, the company encountered difficulties. The absence of stable management (the company had seven presidents between 1972 and 1982), aging production facilities, rising labor costs, and the inability of AMF to operate efficiently and control its many corporate product divisions from its headquarters in White Plains, New York, contributed to a steady decline in sales and profits. Unlike large Japanese corporations such as Matsushita Electric Industrial, which had a standing corporate policy of discontinuing any product line or division in which they were not able to stay in first or second place in total market sales, AMF had continued a practice of purchasing new companies in unfamiliar markets, while simultaneously failing to reorganize and modernize its core operations.[26] As a result, during the late 1970s and early 1980s, the company lost an average of US$8 million per year. Some subsidiaries were sold, including Harley-Davidson in 1981.

For a time, the Italian scuba diving equipment manufacturer Mares was part of AMF, and was able to secure the rights to the MR-12 regulator, previously made by Voit, and to continue manufacture of the regulator. Mares would revert to being an independent manufacturer after AMF was sold. It eventually became part of a worldwide consortium of sports equipment companies, ironically including another former AMF division, Head.[27]

In 1985, AMF was acquired through hostile takeover by Minstar Inc., a Minneapolis-based holding company controlled by investor Irwin L. Jacobs, and Jacobs began selling off its various divisions.[28]

Notes

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  3. 3.0 3.1 3.2 3.3 3.4 Diversified Success, Time Magazine, 19 May 1961
  4. 4.0 4.1 Lua error in package.lua at line 80: module 'strict' not found.
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  6. US Census Most popular sport
  7. 7.0 7.1 7.2 7.3 Lua error in package.lua at line 80: module 'strict' not found.
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  11. 11.0 11.1 Lua error in package.lua at line 80: module 'strict' not found.
  12. Lua error in package.lua at line 80: module 'strict' not found.
  13. 900 Global Article
  14. Lua error in package.lua at line 80: module 'strict' not found.
  15. Lua error in package.lua at line 80: module 'strict' not found.
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  17. Petty, Ross D., Pedaling Schwinn Bicycles: Marketing Lessons for the Leading Post-World War II U.S. Bicycle Brand, Babson College, MA (2007), p. 5 Article
  18. Petty, Ross D., Pedaling Schwinn Bicycles, p. 5
  19. Vandewater, Judith, Vandewater, Judith, Bike Maker Is on the Road Again, St. Louis Post-Dispatch, 7 July 1985
  20. Breaking Away, Tesich, Steve (screenwriter), Yates, Peter (director), distributed by 20th Century Fox, released 13 July 1979
  21. Sands, David R., Chinese Bikes Ruled No Threat To U.S. Makes, The Washington Times, 5 June 1996
  22. Lua error in package.lua at line 80: module 'strict' not found.
  23. Nucleonics, McGraw-Hill.,vol. 21, 1963, p. 30
  24. How to Dispose of Radioactive Wastes, Peter Karter, Electric Light & Power, 1967, Page 3
  25. Mastermind of the MRF Logsdon, Gene. BioCycle. Emmaus: Apr 1993. Vol. 34, Iss. 4; pg. 49, ff.
  26. Panasonic Bicycles Yellow Jersey 2007
  27. Head Company history
  28. Lua error in package.lua at line 80: module 'strict' not found.

External links