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Texaco was an independent company until its refining operations merged into Chevron Corporation in 2001, at which time most of its station franchises were divested to the Shell Oil Company. It began as the Texas Fuel Company, founded in 1901 in Beaumont, Texas, by Joseph S. Cullinan, Thomas J. Donoghue, Walter Benona Sharp, and Arnold Schlaet upon the discovery of oil at Spindletop. For many years, Texaco was the only company selling gasoline under the same brand name in all 50 US states, as well as Canada, making it the most truly national brand among its competitors. Its current logo features a white star in a red circle (a reference to the lone star of Texas), leading to the long-running advertising jingles "You can trust your car to the man who wears the star" and "Star of the American Road." The company was headquartered in Harrison, New York, near White Plains, prior to the merger with Chevron.
Texaco gasoline comes with Techron, an additive developed by Chevron, as of 2005, replacing the previous CleanSystem3. The Texaco brand is strong in the U.S., Latin America and West Africa. It has a presence in Europe as well; for example, it is a well-known retail brand in the UK, with around 1,100 Texaco-branded service stations.
Founding through 1930s
Texaco was founded in Beaumont, Texas as the Texas Fuel Company in 1901. In 1905, it established an operation in Antwerp, Belgium, under the name Continental Petroleum Company, which it acquired control of in 1913. The next year, Texaco moved to new offices in Houston on the corner of San Jacinto and Rusk. In 1928, Texaco became the first U.S. oil company to sell its gasoline nationwide under one single brand name in all 48 states (50 states after Alaska and Hawaii joined the Union in 1959).
Later, in 1931, Texaco purchased Indian Oil Company, based in Illinois. This expanded Texaco's refining and marketing base in the Midwest and also gave Texaco the rights to Indian's Havoline motor oil, which became a Texaco product. The next year, Texaco introduced Fire Chief gasoline nationwide, a motor fuel that meets the octane requirements for fire engines. It was promoted through a radio program over NBC hosted by Ed Wynn, called the Texaco Fire Chief. During this time, Texaco also supplied the Nationalist rebels in Spain with a total 3,500,000 barrels (560,000 m3) barrels of oil.
In 1936, marketing operations east of Suez (including Asia, East Africa, and Australasia) were placed into a joint venture with Standard Oil Company of California – Socal (Chevron) under the brand name Caltex, in exchange for Socal placing its Bahrain refinery and Arabian oilfields into the venture. The next year, Texaco commissioned industrial designer Walter Dorwin Teague to develop a modern service station design. In 1938, Texaco introduced Sky Chief gasoline, a premium grade fuel developed from the ground up as a high-octane gasoline rather than just an ethylized regular product. In 1939, Texaco became one of the first oil companies to introduce a "Registered Rest Room" program to ensure that restroom facilities at all Texaco stations nationwide maintained a standard level of cleanliness to the motoring public.
1940s and 50s
In 1940, the CEO, Torkild Rieber, was forced to resign when his connections with German Nazism, and his supply of oil to the Fascist forces during the Spanish Civil War were made public by the Herald Tribune through information produced by British Security Coordination. During the war, Texaco ranked 93rd among United States corporations in the value of military production contracts. In 1947, Caltex expanded to include Texaco's European marketing operations. That same year, Texaco merged its British operation with Trinidad Leaseholds under the name Regent; it gained full control of Regent in 1956, but the Regent brand remained in use until 1968-9. In 1954, the company added the detergent additive Petrox to its "Sky Chief" gasoline, which was also souped up with higher octane to meet the antiknock needs of new cars with high-compression engines. The next year, Texaco became the sole sponsor of The Huntley-Brinkley Report on NBC-TV. In 1959, the Texas Company changed its corporate name to Texaco, Inc. to better reflect the value of the Texaco brand name, which represented the biggest selling gasoline brand in the U.S. and only marketer selling gasoline under one brand name in all 50 states. It also acquired McColl-Frontenac Oil Company Ltd. of Canada and changes its name to Texaco Canada Ltd. Around this time, Paragon Oil, a major fuel oil distribution company in the northeastern U.S, was acquired.
1960s and 70s
In 1964, Texaco introduced the "Matawan" service station design at a station in Matawan, New Jersey. Two years later, Texaco replaced the long-running banjo sign with a new hexagon logo that had previously been test-marketed with the "Matawan" station design introduced two years earlier. The new logo featured red outline with TEXACO in black bold lettering and small banjo logo with red star and green T at bottom. The following year, the Regent name replaced by Texaco at British petrol stations. In 1970, in response to increasingly stringent federal emission standards that would ultimately lead to mandating of unleaded gasoline in 1975 and later-model cars and trucks, Texaco introduced lead-free Texaco as the first regular-octane lead-free gasoline at stations in the Los Angeles area and throughout Southern California. lead-free Texaco became available nationwide in 1974. Eight years later, Texaco Canada Ltd. merged with Texaco Explorations Canada Ltd. to form Texaco Canada Inc.
1980s and 90s
On November 21, 1980, the Lake Peigneur/Jefferson Island disaster occurred. Two years later, a new service station design was introduced. Several product names were also changed with the advent of self-service including Lead-free Texaco to Texaco Unleaded, Fire Chief to Texaco Regular, and Super Lead-free Sky Chief to Texaco Super Unleaded. On November 19, 1985, Pennzoil won a US$10.53 billion verdict against Texaco in the largest civil verdict in US history. This was due to the fact that Texaco established a signed contract to buy Getty Oil after Pennzoil entered into an unsigned, yet still binding, buyout contract with Gordon Getty. In 1987, Texaco filed for bankruptcy. It was the largest in U.S. history until 2001.
The following year, Texaco and Saudi Aramco agreed to form a joint venture known as Star Enterprise in which Saudi Aramco would own a 50% share of Texaco's refining and marketing operations in the eastern U.S. and Gulf Coast. In 1989, Texaco introduced System3 gasolines in all three grades of fuel, featuring the latest detergent additive technology to improve performance by reducing deposits that clog fuel injection systems. Texaco Canada Inc was sold to Imperial Oil with retail operations converted to Esso brand. Two years later, the company was awarded the National Medal of Arts. In 1993, several dozen tribal leaders and residents from the Ecuadoran Amazon filed a billion-dollar class-action lawsuit against Texaco, as a result of massive ecological pollution of the area and rivers around Texaco's Ecuadorian offshore drilling sites, causing toxic contamination of approximately 30,000 residents.
In 1994, Texaco's System3 gasolines were replaced by new CleanSystem3 gasoline for improved engine performance. The following year, Texaco merged its Danish and Norwegian downstream operations with those of Norsk Hydro under the new brand HydroTexaco. This joint venture was sold in 2007 to Norwegian retail interests as YX Energi, following the purchase of Hydro by Statoil. In 1996, Texaco paid over $170 million to settle racial discrimination lawsuits filed by black employees at the company. It was the largest racial discrimination lawsuit settlement in the U.S. at the time, and was particularly damaging to Texaco's public relations when tapes were released containing ethnic slurs used repeatedly by company officers at high-level corporate meetings. Two years later, the company formed the joint venture Equilon with Shell Oil Company, combining their Western and Midwestern U.S. refining and marketing. This gave rise to the 2006 U.S. Supreme Court antitrust case of Texaco Inc. v. Dagher, which cleared both Texaco and Shell of any antitrust liability concerning the pricing of Equilon's gasoline. That same year, another joint venture, Motiva, was formed with Shell Oil Company and Saudi Aramco in which the Star Enterprise operations were merged with the Eastern and Gulf Coast U.S. refining and marketing operations of Shell.
Chevron Corporation merged with Texaco six days later, and Shell purchased Texaco's interest in the Equilon and Motiva joint ventures. Shell began converting its Texaco stations to the Shell brand the next year. In July 2004, Chevron regained non-exclusive rights to the Texaco brand name in the U.S. The following year, in August, Texaco introduced the Techron additive into its fuels in the U.S. and parts of Latin America. In 2007, Delek Benelux took over marketing activities for Chevron in Benelux, including 869 filling stations, mostly under the Texaco brand. Chevron Corporation also sold its Conoco stations in Mississippi to the Texaco brand name. In 2010, Chevron and Texaco ended retail operations in the Mid-Atlantic US, removing their brand from 1,100 stations in Delaware, Indiana, Kentucky, North Carolina, New Jersey, Maryland, Ohio, Pennsylvania, South Carolina, Virginia, West Virginia, Washington, D.C., and parts of Tennessee.
Prior to the merger, Texaco's headquarters, a 750,000-square-foot (70,000 m2) building, were in Harrison, New York, near White Plains. In 2002, Chevron sold the former Texaco headquarters to Morgan Stanley. Morgan Stanley bought the building and the surrounding 107 acres (0.43 km2) for $42 million.
In popular culture
A location was used in the opening scene of Cheech & Chong's Next Movie at 6407 West Sunset Boulevard in Los Angeles, California where the main characters Cheech & Chong siphon gasoline from a tow truck. A Jack in the Box now stands at that location.
Texaco is associated with the Havoline brand of motor oil and other automotive products. It was one of the sponsors of NASCAR with drivers like Davey Allison, Ernie Irvan, Kenny Irwin Jr., Ricky Rudd, Jamie McMurray, Casey Mears, and Juan Pablo Montoya. Texaco last sponsored the #42 Dodge driven by Montoya. Havoline sponsored a NASCAR race car continuously from the early 1980s through the 2008 season. At the end of the 2008 NASCAR season, Texaco/Havoline officially ended their sponsorship with NASCAR and Chip Ganassi Racing. This brought to a close a 20-plus year relationship with the sport. Texaco has also has also been involved in open wheel racing, sponsoring the Texaco Grand Prix of Houston along with sponsoring drivers like Indianapolis 500 winner Mario Andretti and his son Michael.
Texaco was long associated with the Metropolitan Opera as sole sponsor of its radio broadcasts for 63 years. It was identified as well with such entertainment legends as Bob Hope, Jack Benny and Milton Berle (many of their shows were originally sponsored by Texaco – see Texaco Star Theatre, which includes the sponsorship lyrics of the opening theme: "We're the men of Texaco, We work from Maine to Mexico..."). Berle's program was broadcast in the same time slot as Fulton J. Sheen's religious program for a while, thus leading to Berle's oft-quoted quip, "We both have the same boss – Sky Chief!"
From 1965–1993, Texaco participated in a consortium to develop the Lago Agrio oil field in Ecuador. It has been accused of extensive environmental damage from these operations, and faces legal claims from both private plaintiffs and the government of Ecuador. The case has been widely publicized by environmental activists and is the subject of Crude, a 2009 documentary film by Joe Berlinger. Chevron claims that it is being unfairly targeted as a deep pocket defendant, when the actual responsibility lies with the government and its national oil company.
The NiMH chemistry used in modern hybrid vehicles was invented by ECD Ovonics founder, Stan Ovshinksy, and Dr. Masahiko Oshitani of the Yuasa Company In 1994, General Motors acquired a controlling interest in Ovonics's battery development and manufacturing. On October 10, 2001, Texaco purchased GM's share in GM Ovonics, and Chevron completed its acquisition of Texaco six days later. In 2003, Texaco Ovonics Battery Systems was restructured into Cobasys, a 50/50 joint venture between Chevron and Energy Conversion Devices (ECD) Ovonics. Chevron's influence over Cobasys extends beyond a strict 50/50 joint venture. Chevron holds a 19.99% interest in ECD Ovonics. In addition, Chevron maintains the right to seize all of Cobasys' intellectual property rights in the event that ECD Ovonics does not fulfill its contractual obligations. On September 10, 2007, Chevron filed a legal claim that ECD Ovonics has not fulfilled its obligations. ECD Ovonics disputes this claim. Since that time, the arbitration hearing was repeatedly suspended while the parties negotiate with an unknown prospective buyer. No agreement has been reached with the potential buyer. Cobasys's patents relating to NiMH batteries expire in 2015.
In her book, Plug-in Hybrids: The Cars that Will Recharge America, published in February 2007, Sherry Boschert argues that large-format NiMH batteries are commercially viable but that Cobasys refuses to sell or license them to small companies or individuals. Boschert argues that Cobasys accepts only very large orders for these batteries. When Boschert conducted her research, major auto makers showed little interest in large orders for large-format NiMH batteries. However, Toyota employees complained about the difficulty in getting smaller orders of large format NiMH batteries to service the existing 825 RAV-4EVs. Because no other companies were willing to make large orders, Cobasys was not manufacturing nor licensing any large format NiMH battery technology for automotive purposes. Boschert concludes that "it's possible that Cobasys (Chevron) is squelching all access to large NiMH batteries through its control of patent licenses in order to remove a competitor to gasoline. Or it's possible that Cobasys simply wants the market for itself and is waiting for a major automaker to start producing plug-in hybrids or electric vehicles."
In an interview with the Economist, Ovshinsky subscribed to the former view. "I think we at ECD we made a mistake of having a joint venture with an oil company, frankly speaking. And I think it’s not a good idea to go into business with somebody whose strategies would put you out of business, rather than building the business."
In December 2006, Cobasys and General Motors announced that they had signed a contract under which Cobasys provides NiMH batteries for the Saturn Aura hybrid sedan. In March 2007, GM announced that it would use Cobasys NiMH batteries in the 2008 Chevrolet Malibu hybrid as well.
In October 2007, International Acquisitions Services, Inc. and Innovative Transportation Systems AG filed suit against Cobasys and its parents for refusing to fill a large, previously agreed-upon order for large-format NiMH batteries to be used in the electric Innovan.
In August 2008, Mercedes-Benz U.S. International Inc. filed suit against Cobasys claiming that Cobasys isn’t delivering the batteries it agreed to build for Mercedes-Benz’s planned hybrid SUV.
Cobasys was sold in 2009 to SB Li Motive, which is a joint venture formed by Bosch and Samsung to develop lithium ion batteries for automotive applications. The sale price was not disclosed. The German-Korean company will integrate Cobasys as the North American branch of the company. Cobasys will supply batteries to the new Mercedes ML450 hybrid.
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