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|Traded as||OMX: KNEBV
OTC Pink: KNYJY (ADR)
|Industry||Engineering and service|
|Key people||Antti Herlin (Chairman)
Henrik Ehrnrooth (President and CEO)
|Products||Elevators, escalators, automatic building doors|
|Operating income||€953 million|
|Total assets||€5,343 billion|
|Total equity||€1,725 billion|
Kone Oyj (officially typeset KONE and pronounced [KOH-neh]), founded in 1910 and headquartered in Espoo, Finland, is an international engineering and service company employing some 32,500 personnel worldwide. The firm is one of the largest manufacturers of elevators and escalators worldwide, and also provides maintenance services and modernization solutions. In addition, KONE builds and services automatic doors and gates. The company provides local service for builders, developers, building owners, designers and architects in 800 locations in over 40 countries. Since 1924, KONE has been owned by one of Finland's wealthiest families, the Herlin family. After Harald Herlin purchased the company in 1924, he served as its Chairman until 1941. Afterwards, his son, Heikki H. Herlin, took over his father's post from 1941–1987. Control of the company was then handed down to his son, Pekka Herlin, which he retained from 1987–2003. The current Chairman of KONE's Board of Directors from 2003 onwards is Antti Herlin, the son of Pekka Herlin.
In the Finnish language Kone means "machine" or "device".
KONE (then known as Osakeyhtiö Kone Aktiebolag) was founded in 1910 as a subsidiary of Gottfr. Strömberg Oy. Strömberg's license to import Graham Brothers elevators was transferred to the new company. KONE sold just a few units before terminating the licensing agreement in 1917. KONE, then a company with only 50 employees, started to make and install its own elevators in 1918. Six years later, in 1924, entrepreneur Harald Herlin bought KONE from Strömberg and became the new chairman of the company's Board of Directors. His son, Heikki Herlin, joined the company and was appointed technical director in 1928. His office was located in a former margarine factory on Haapaniemi Street in Helsinki that KONE had bought and converted into an elevator production facility the previous year. Heikki Herlin took over as KONE's president in 1932. KONE's first foreign subsidiary - AB Kone Hissar of Sweden - was established in 1957.
After World War II, KONE was called upon by the Finnish government to contribute elevators, electric hoists and cranes to the war reparations being paid to the Soviet Union. This program forced KONE to expand its capacity, rationalize production processes and learn to meet demanding manufacturing schedules. In the 1950s KONE introduced its first group controls, automatic doors and hydraulic elevators. Heikki Herlin turned over the president's duties in 1964 to his son, Pekka, who had served as administrative director since 1958.
KONE opened a purpose-built elevator factory in 1966 in Hyvinkää, Finland. The following year KONE was listed on the Helsinki Exchanges and started its international expansion through the acquisition of Sweden's Asea-Graham and its Norwegian and Danish affiliates. Numerous acquisitions followed during the 1970s and 1980s with only the most significant being listed here. The acquisitions of companies larger and older than KONE itself has been seen to have brought KONE respectability and lifted the company to a position of market prominence. Eventually KONE further expanded its business scope. The company became one of the world's largest hoist and crane manufacturers as well as a producer of high-tech electronic hospital and laboratory equipment.
In 1981 KONE entered the American elevator market with the acquisition of New York City based Armor Elevator Company, which it continued to operate independently as a wholly owned subsidiary. The company acquired Navire Cargo Gear in 1982 and International MacGregor, makers of shipboard cargo access equipment. Wood-handling systems and equipment for pulp and paper mills, hydraulic piping systems, mining equipment and conveyors, and specialized steel components were manufactured at KONE's steel foundry. In 1987, after 60 years as a member of KONE's board of directors and 46 as its chairman, Heikki Herlin retired. Prevented by Finnish law from serving simultaneously as president and board chairman, Pekka Herlin ceded the presidency to Matti Matinpalo, the first non-Herlin to occupy the position in 55 years, and continued as Chairman of the Board.
In 1990, KONE sold its shipboard cargo handling business in 1993, as well as its crane (Konecranes), wood handling and piping systems businesses in 1994, and finally the steel foundry and electronic medical instruments divisions in 1995. Only its elevators, escalators, and automatic door branches remained. KONE acquired the Montgomery Elevator Company of the U.S. in 1994. Soon afterwards, the KONE Corporation purchased a majority of the outstanding shares of O&K Rolltreppen GmbH of Germany, a supplier of escalators and autowalks. In 1998 the company made a $29 million (US) investment in the construction of an elevator and escalator factory in Kunshan, China.
In 1996, Antti Herlin, the great-grandson of the company's founder, was appointed KONE CEO and deputy chairman of the board of the company that he had now inherited. The company introduced new technology such as the KONE EcoDisc hoisting machine and the KONE MonoSpace elevator technology concept in 1996. KONE was one of the first to introduce machine-room-less (MRL) construction in elevators. KONE's MRL designs significantly reduced the size of elevator machinery and its lift mechanism by using permanent-magnet electric motors (PMM). The use of these mechanisms enabled all of the elevator's equipment and its inner workings to be confined to the space above the elevator shaft, known as the hoistway overhead, instead of needing an entire room dedicated to machinery. At the beginning of the 21st Century, due to the apparent benefits of KONE's pioneering elevator systems, rival companies[which?] began competitively marketing machine-room-less elevators of their own.
KONEs chairman of the board, Pekka Herlin, died on April 4, 2003 after a long illness. Antti Herlin was subsequently appointed the new chairman of the board in June 2003. Matti Alahuhta, a former Executive Vice President at Nokia Corporation, previously serving as the President of Nokia Mobile Phones, was later chosen to fill Herlin's vacant position as the acting President of the KONE Corporation. He has held the position since 2005, officially becoming the firm's President and CEO in 2006.
In 2002, KONE acquired Partek, a Finnish industrial engineering company with net sales equal to KONE's. Partek's business areas specialized in container handling, load handling, forest machinery and tractors. The tractors were manufactured under the Valtra brand. The KONE Materials Handling division thus comprised these Partek business areas.
In 2003, KONE decided to concentrate on Container Handling and Load Handling and the tractor and forest machine businesses were sold. The Valtra tractor business was sold to AGCO, a worldwide agricultural manufacturer. As the structure of KONE Materials Handling had changed significantly, the name KONE Cargotec was introduced in January 2004. Its business areas were Kalmar (container handling) and HIAB (load handling).
At the end of 2004, KONE Cargotec acquired MacGREGOR, a global marine cargo-flow solution and service provider.
In August 2004 the KONE Board of Directors presented a plan to split the company into two separately listed companies on the Helsinki Stock Exchanges in June, 2005. One company would comprise KONE's existing elevator, escalator & building door service business and continue to operate under the name KONE Corporation. The other company would comprise KONE Cargotec’s business area and operate under the name Cargotec Corporation. The Extraordinary Shareholders’ Meeting in December 2004 approved the Demerger Plan. The demerger was completed in June 2005.
In September 2007 it was announced that KONE is proposing to lease several floors of a new riverfront tower to be built on Bass Street Landing, which is part of the Moline Riverfront.
Also in 2007, it was announced KONE had received part of what was then the largest fine ever handed out by the EU Commission for local anti-competitive practices in the elevator and escalator markets in Belgium, Germany, Luxembourg and the Netherlands relating to time prior to mid-2004 (the commission stated that it could only prove its case back to 1995, though evidence allegedly suggested the abuse had started much earlier). Competitors ThyssenKrupp, Schindler Group, Otis Elevator Co. and Mitsubishi Elevator Europe were also given similar fines. KONE has appealed against the size of the fine, currently 142 million EUR. In total, the industry received 1 billion EUR fine for cartel activity across Belgium, Germany, Luxembourg and the Netherlands.
Finally, in 2007, KONE announced that they would stop production of hydraulic elevators, replacing them with the EcoSpace MRL elevators, due to the hydraulic elevators' inefficient energy consumption, contamination concerns regarding the use of hydraulic oil and buried cylinders, and other environmental concerns. Therefore, KONE has become the first major brand elevator company to make only traction elevators.
Alliances and acquisitions
- 1981 – KONE enters the United States market by acquiring Armor Elevator Co.
- 1985 – the acquisition of Montgomery Elevator's Canadian subsidiary opens an alliance with Montgomery in the U.S. that leads to the total integration of Montgomery into the KONE organization after 1994.
- 1995 – an alliance was formed as KONE and MacGregor worked together to create elevators for handling passenger traffic on modern cruise ships.
- 1998 – KONE's alliance initiated with Toshiba (now divided to Toshiba Elevator And Building Systems Corp.) of Japan.
- 2001 – KONE and Toshiba signed a historic agreement to exchange shares and extend Toshiba's license to market elevators based on KONE EcoDisc technology.
- 2002 – KONE acquires the industrial engineering company Partek
- 2007 – KONE announces they will no longer make hydraulic elevators.
- 2009 – KONE acquires Fairway Elevator Company in Philadelphia to enter the modernization market in that area.
- 2011 - KONE builds a new headquarters in the United States with the name of The Kone Centre in Moline, Illinois, the present headquarters is also located there.
- 2011 - KONE acquires Long Elevator Company headquartered in Springfield, IL serving St. Louis, Peoria, Chicago and NW Indiana.
- 2013 - KONE acquired its Israeli distributor Isralift
In 2013, KONE has been awarded for several GOOD DESIGN awards for its design offering, functional elevator signalization series and sleek new elevator car design. This is the third time KONE has received this acknowledgement for its design excellence.
In June 2013 KONE launched a new high-rise elevator technology, called KONE UltraRope, which enables future elevator travel heights of 1 kilometre. KONE UltraRope is extremely light due to its carbon fibre core and a high-friction coating. Because of these qualities, elevator energy consumption in high-rise buildings can be cut significantly.
KONE EcoDisc motor
The KONE EcoDisc hoisting motor reduces the amount of energy lost as heat. The motor control system and brakes make the elevator ride quiet and the design frees up space.
KONE MonoSpace elevator
The KONE MonoSpace for low- to mid-rise buildings is the world’s first machine-room-less elevator. In 2012 KONE launched a completely new range of KONE MonoSpace elevators. KONE MonoSpace elevators are often used in buildings in need of elevator modernisation.
KONE EcoSpace elevator
The KONE EcoSpace elevator is a machine-room-less traction elevator designed for low-rise buildings from 2 to 15 stories as an energy-efficient alternative to hydraulic elevators, and can fit in an existing hydraulic elevator hoistway. Initially available only in a 150 feet per minute (0.76 m/s) speed, in 2013, 200 feet per minute (1.0 m/s) and 350 feet per minute (1.8 m/s) variants became available.
KONE MiniSpace elevator
The KONE MiniSpace is an elevator with a small machine room and is often used in high-rise buildings. KONE MiniSpace elevators are powered by the KONE EcoDisc hoisting machine.
The European Union (EU) gave a fine of 992m euros ($1.3bn; £666.8m) on four lift and escalator manufacturers for price-fixing between 1995 and 2004. Germany's ThyssenKrupp, US-owned Otis Elevator Company, Kone of Finland and Swiss firm Schindler were fined for taking part in a market-rigging cartel.
- "Kone Purchases Armor Elevator". The New York Times. November 11, 1981. Retrieved May 7, 2010.
- Schorpp, Doug. :Kone to sell its Moline properties to Q-C developer", "QCTimes.com",September 27, 2007. Accessed September 27, 2007.
- "Finnish Lift Maker Kone to Appeal EU Cartel Fine". Reuters. March 2, 2007.
- Hydraulic Elevators
- "KONE wins four prestigious GOOD DESIGN awards" February 3 2014. Retrieved on 19 June 2014.
- New KONE UltraRope(TM) elevator hoisting technology enables the next big leap in high-rise building design | KONE Press Release June 10, 2013
- A proven technology leader
- EcoSpace Low-Rise Elevator | KONE U.S
- Record EU fine for lift 'cartel' BBC 21.10.2013
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