Tenneco Inc. manufacturers automotive emission control and ride control products.
It was once a large conglomeration, but since 1999 has become a standalone company specializing in automotive components.
Tenneco is a Fortune 500 company, listed 15th amongst Motor Vehicle and Parts manufacturers.[1] Its revenue for 2007 was US$6.2 billion.[2]
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[edit] History
[edit] Chicago Corporation to Tennessee Gas: Building a Company with Oil
Tenneco was established in 1960, but its history begins in the 1930s with an investment firm and bank subsidiary called Chicago Corp.
A young Chicago Corp. vice president named Henry Gardiner Symonds was assigned to manage some newly acquired property in Texas. The land, near Corpus Christi, was purchased for its natural gas deposits.
Oil was discovered on the land in 1938, but Symonds was unable to transport it because of a national shortage of pipeline materials. However, in 1943, defense plants in West Virginia were suffering a shortage of fuel, which influenced the Federal Power Commission (FPC) to allow Chicago Corp. to operate a pipeline. The FPC also provided Chicago Corp. with priority rights to pipeline materials.
Symonds was in charge of constructing the 1,265-mile (2,036-km) pipeline linking Gulf States gas fields to factories of the eastern United States. To help with the project, Chicago Corp. acquired Tennessee Gas and Transmission Co. The pipeline was completed in October 1944.
The day after the pipeline was completed, the FPC sought to regulate its transmission rate. Symonds protested, contending the FPC led him to believe they would operate without regulations. As a result, Symonds declared he would never again be involved in any project subject to government regulations.
After World War II, Chicago Corp. split from Tennessee Gas, but Symonds remained. He was eventually named president of Tennessee Gas.
[edit] Tennessee Gas to Tenneco Corp.: Expanding Beyond Oil
Tennessee Gas continued adding pipelines to its growing network. It planned an additional 3,840 miles (6,180 km) by 1946 because an extended coal strike had increased demand for oil and natural gas.
Profits from the pipes were used to establish a subsidiary business for oil and gas exploration. Meanwhile, Symonds was advocating the acquisition of existing oil companies including Sterling Oil, Del-Rey Petroleum, and Bay Petroleum. Tennessee Gas also acquired several petrochemical companies to diversify its product line.
In 1960, Tenneco Corp. was formed to coordinate the management of Tennessee Gas subsidiaries.
During this time, Tennessee Gas received unfavorable publicity from legal matters it was undergoing. As a result, in February 1961 the company underwent a corporate restructuring, placing Tennessee Gas & Bay Petroleum under the managerial control of Tenneco. However, it was not until April 1966 that Tenneco officially assumed control of all of Tennessee Gas’ assets. Symonds was promoted to chief executive officer (CEO) and chief policy officer (CPO).
Under Tenneco, the company continued acquiring subsidiaries. It added Heyden Newport Chemical Corp., Packaging Corporation of America, and Kern County Land Co.
Kern County was purchased for approximately US$430 million.[3] It owned land with oil deposits, but lacked the “expertise” to develop them. It also owned agriculture businesses, including a 53 percent interest in J.I. Case and Walker Manufacturing.[4]
By this time Tenneco had grown so large it was divided in two: Tenneco West and Tenneco Virginia.
In September 1968, Tenneco Virginia purchased Newport News Shipbuilding & Drydock Co. for approximately US$140 million.[5] Newport News was the nation’s largest privately owned shipyard, but was suffering financially. It was involved in the construction of nuclear-powered submarines and aircraft carriers, as well as merchant and commercial ships.
Symonds died of a heart ailment on June 2, 1971. He was succeeded by James Lee Ketelsen.
By 1971, after a US$100 million investment, Newport News became a successful venture. In fact, by 1973 it had accumulated an order backlog of US$1 million. Still, Newport News caused trouble for Tenneco. Its workers held a three-month strike in which all 16,500 employees gained representation from United Steelworkers. Eventually the Occupational Health and Safety Administration (OHSA) levied a US$786,190 fine, after citing 617 cases of deficient medical care, unsafe working conditions, and excessive noise.[6]
Wall Street analysts said Tenneco would be better off dropping Newport News from its holdings, but Tenneco saw its potential.[7] This paid off in 1981 when Navy secretary John Lehman declared an intention to build a 600-ship navy. Immediately, Newport News stopped commercial ship construction in favor of government contracts.
Through the 1970s, Tenneco’s auto parts division experienced significant growth. It acquired AB Starlawerken, Monroe Auto Equipment, and Lydex.
In 1985, Tenneco purchased the farm machinery division of International Harvester for US$430 million and combined it with its Case subsidiary.[8] Together, they gained a 35 percent market share of large tractors, second only to John Deere’s 42 percent.[9]
[edit] Conglomeration to Stand-alone Companies: Divesting to Two
Through the 1980s, Tenneco was discovering how far it had extended itself. Its debt was growing and many of its assets were underperforming. As a result, it sold off many subsidiaries, including its precious metals operations, agricultural operations of Tenneco West, Tenneco Oil Co. and the retail muffler shops of Tenneco Automotive.
In August 1991, Ketelsen was replaced by Michael H. Walsh, who was dubbed a “tough boss for tough times” by Business Week. New CEO Walsh found the company in worse shape than he was led to believe. Tenneco’s earnings and cash flow was falling short of its targets in nearly every division. Debt was standing at 70 percent of Tenneco’s capital.[10]
Walsh instituted a US$2 billion plan incorporating retrenchment initiatives to face lingering global recession.[11] He eliminated 8,000 jobs and divested three short-line railroads and a number of other non-core assets. He issued $512 million in new equity, while reducing capital spending for a two-year period by US$300 million.[12]
In 1992, Walsh introduced additional reorganization. His focus was on divestments and consolidation. After 18 months Walsh had reversed potentially dangerous trends
In January 1993, Walsh announced he was diagnosed with inoperable brain cancer. He maintained his position throughout Tenneco’s reorganization, but designated a successor: Dana G. Mead. In February 1994 Walsh passed presidency and CEO office to Mead.
Walsh died in May 1994.
Mead followed the lead of Walsh by continuing to divest Tenneco of subsidiaries and minimizing its holdings.
By 1999, Tenneco had become a company with only two divisions: Tenneco Automotive and Tenneco Packaging. In October 2009, these two companies separated.
"The split will enable each company to concentrate on its core business, permit investors to make more focused investment decisions, and enhance the potential of each company to achieve more appropriate market valuation," Mead said.[13]
On November 5, 1999, they began regular trading on the New York Stock Exchange as stand-alone companies.
On October 28, 2005, Tenneco Automotive changed its named to Tenneco Inc.
[edit] The Company Today
Tenneco is a multi-billion dollar automotive parts manufacturer currently being traded on the New York Stock Exchange under the symbol TEN. Its parts serve a global market of original equipment manufacturers, including General Motors, Ford Motor Co., Volkswagon, DaimlerChrysler, PSA Peugot Citroen, Toyota, Honda, and Nissan.
The company is based in Lake Forest, Illinois. It has 19,000 employees worldwide.[14]
Tenneco’s chairman and CEO is Gregg M. Sherrill.[15]
[edit] Equipment List
[edit] Ride Control
- Acceleration sensitive damping shock absorber
- Body mount
- Coil spring
- Continuously controlled electronic suspension
- Control arm bushing
- Corner axle module
- Engine mount
- Exhaust isolator
- Frequency dependent damping shock absorber
- Full axle module
- Gripper stabilizer bar system
- Kinetic suspension technology
- Leaf spring
- Link bushing
- Monotube shock absorber
- Performance shock absorber
- Spring seat
- Stabilizer bar bushing
- Suspension bushing
[edit] Emission Control
- Catalytic converter
- Center muffler
- DeNox converter aftertreatment system
- Diesel oxidation catalyst
- Diesel particulate filter
- Downpipe
- Fabricated manifold
- Heat exchanger
- Lean nox trap
- Rear muffler
- Resonator
- Selective catalytic reduction
- Tailpipe
[edit] References
- ↑ Fortune 500. Money CNN. 2008-09-09.
- ↑ Fortune 500. Money CNN. 2008-09-09.
- ↑ Tenneco Inc. Funding Universe. 2008-09-09.
- ↑ Tenneco Inc. Funding Universe. 2008-09-09.
- ↑ Tenneco Inc. Funding Universe. 2008-09-09.
- ↑ Tenneco Inc. Funding Universe. 2008-09-09.
- ↑ Tenneco Inc. Funding Universe. 2008-09-09.
- ↑ Tenneco Inc. Funding Universe. 2008-09-09.
- ↑ Tenneco Inc. Funding Universe. 2008-09-09.
- ↑ Tenneco Inc. Funding Universe. 2008-09-09.
- ↑ Tenneco Inc. Funding Universe. 2008-09-09.
- ↑ Tenneco Inc. Funding Universe. 2008-09-09.
- ↑ Tenneco Inc. Scripophily. 2008-09-09.
- ↑ Financial Overview. Tenneco. 2008-09-09.
- ↑ Tenneco. Answers.com. 2008-09-09.
