The Greenbrier Companies

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The Greenbrier Companies
Type Public:
Traded as NYSEGBX
Russell 2000 Component
Industry Marine Engineering / Railways
Predecessor(s) Gunderson Bros. (1919)
Founded 1981
Headquarters Lake Oswego, Oregon, United States
Key people William A. Furman, President and CEO (1994-)[1]
Mark Rittenbaum, CFO & Vice President[2]
Products Ships, freight rolling stock
Revenue $1.79 billion USD (2013)
Employees 3,661 (2006)
Website www.gbrx.com

The Greenbrier Companies is a publicly traded transportation manufacturing corporation based in Lake Oswego, Oregon, United States. Predominantly an American company, Greenbrier specializes in transportation services, notably barge and railroad car manufacturing, railroad car refurbishment, and railroad car leasing/management services. As of 2006, Greenbrier employs in excess of 3,500 people combined at its operations in Europe, Mexico, Canada, and the United States. Formed in 1981 and went public in 1994, the company generates revenues of USD $953 million.

The main operating business of the company is Gunderson Inc. based in Oregon, USA. The company also has manufacturing facilities in Świdnica, Poland (Europe), and two railcar plants in Mexico.

History[edit]

Gunderson Inc.[edit]

In Chester Ellsworth Gunderson, son of a Swedish immigrant, founded the Wire Wheel Sales & Service Company, acting as a distribution partner for the Houk Company, Pennsylvania, a manufacturer of wire wheels. His brother Alvin Gunderson joined the company in 1923. In 1925, the company became the Wheel & Rim Service Inc.[3]

By the 1930s the company expanded in other automobile parts servicing. After an unsuccessful foray into the fertilizer distribution business, the company began to manufacture trailers, the equipment for which required an investment of over $12,000. In 1937, a dual-axle trailer began production, suitable for on- and off-road use. The new design of trailers were a commercial success and in 1938, the incorporated company Gunderson Bros. was formed, with its factory in Linnton, Portland, Oregon. In 1941, the company began building ships. The company distributed, installed and pioneered the use of General Motors diesel engines, with products including winches using engines coupled through fluid couplings.[4]

In 1938, the company was near bankruptcy, in part due to the effects of the Great Depression, and in part due to the Gunderson's own financial mismanagement. The company's main creditor, their bank, took control of the accounts, and began to pay their suppliers, but the company's financial position remained tenuous.[5]

At the beginning of the Second World War the company handled assembly work for the U.S. Navy; a 1941 a loan from the Navy enabled the building of a shipyard. During the same period, continued debts caused the original factory to taken by the Federal government as security. Gunderson also constructed lifeboats, landing craft and other vessels, as well as trailers for the U.S. Army. Shortage of manpower also led to the first women working in the construction sheds.[6]

An unusual contract - the RP FLIP research vessel

In 1942, the company became Gunderson Bros. Engineering Corporation.[7] After the war, the company had comprehensive facilities for large scale metal engineering, as well as a slipway for launching ships at the Front Avenue plant, and the earlier Linnton plant was closed.[8] Construction of marine vessels such as tugs, barges, trawlers and more specialised craft continued in the 1950s and 1960s, by the 1970s the company was building vessels as long as 650 ft (200 m) and as wide as 100 ft (30 m).[9] Other postwar business lines included metal water towers, large scale metal storage tanks, bridges and structural steel for buildings as well as specialised equipment such as metal slipways for the McNary Dam (1950s), a dry dock for the Port of Portland (1963), and the vessel RP FLIP (1962).[10]

The company entered the rolling stock business in 1958, with a successful bid to construct 200 boxcar underframes for the Southern Pacific Railroad. The business was successful and profitable, and the order expanded with Gunderson eventually building over 2,000 frames in the first contract.[11]

In 1965, the Gunderson's sold their company to the FMC Corporation. In 1973, the company became a division of FMC as the Marine and Rail Equipment Division of FMC (MRED).[12] By 1979, over 6,000 freight wagons were produced. The following year the early 1980s recession began and orders plummeted, by 1982 only 25 railcars were built. At the same time new developments in rail freight transport led to new products. Ten-car units of Jacobs articulated flatcars for transportation of road semi-trailers were built for the Itel Corporation. Also in the 1980s, the company developed "Twin-Stack" flatcars for double-stack rail transport of intermodal containers in a joint venture with Greenbrier.[13] The "Twin-Stack" became an important product with approximately 3,000 being produced per year in 1990.[14]

In 1985, the company was acquired by the Greenbriers Companies and the Gunderson name restored as Gunderson, Inc.[14]

Greenbrier Companies[edit]

Articulated well cars with intermodal containers

In 1970, the Commercial Metals Company and M.D. Friedman companies jointly formed a flatcar leasing company: Greenbrier Leasing Corporation. In 1981, Commercial Metals sold the company to Alan James and William A. Furman, the leasing business became part of the Greenbrier Companies.[15] In 1985, the company acquired the Marine and Rail Car Division of the FMC Corporation (MRED) (formerly Gunderson Bros. Engineering) and renamed it Gunderson, Inc.[14]

In the early 1990s, the company's sales and profits increased dramatically due to an increase in North American railfreight. The company went public in 1994, and in 1995 acquired TrentonWorks, another rail freight rolling stock manufacturing facility in Canada.[16]

In 1998, the company acquired Polish freight car manufacturer WagonyŚwidnica SA, and formed a joint venture with Bombardier Inc. in a former-Concarril plant in Sahagun City for the manufacture of rail freight vehicles, named Gunderson-Concarril S.A.[17] In 2004, Bombardier's stake in the venture was acquired.[18][19] Another Mexican plant, Gunderson-GIMSA S de L de CV, was formed in 2006 as a joint venture with Grupo Industrial Monclova.[20]

In 2007, the TrentonWorks plant in Nova Scotia, Canada closed, in part due to unfavorable exchange rates, as well as lower operating costs in Mexico.[21][22]

Between 2006 and 2008, the company bought several rolling stock equipment companies.[23]

In 2007, GE Rail Services agreed to a $1.2 billion contract for building over 10,000 rail cars: as a result of the general economic recession initiated by the 2000s financial crisis GE attempted to alter the terms of the contract which represented 84 percent of Greenbrier's order book; any reduction in the order volume was expected to cause job and revenue losses in addition to those already caused by the recession and the production slowdown for the GE order. The situation led to members of the Greenbrier board being openly critical of their client GE. On 15 December 2009, GE and Greenbrier reached a modified contract agreement in which Greenbrier would manufacturer up to 6000 units for GE. As terms of the contract Greenbrier gained the right of first refusal to manufacture any GE railcar order placed up to December 2018, and a similar right to any vehicle refurbishment up to 2015. Greenbrier also obtained maintenance co-partner agreement for GE's rail rolling stock over a five-year period. The resultant contract gave Greenbrier an order book of at least 4,900 units valued at $430 million plus an option for a further 2,200 vehicles. The reduced contract still represented approximately 40 percent of the North American freight car industry backlog.[24]

In December 2012, Carl Icahn made an offer to purchase Greenbrier for $20 a share, representing a 5.4 percent premium to Greenbrier's stock price at that time.[25]

Products and services[edit]

Marine[edit]

Under the name Gunderson Marine LLC, the Portland, Oregon, United States plant manufactures ocean-going conventional deck barges, double-hull tank barges, railcar/deck barges, barges for aggregates and other heavy industrial products and ocean-going dump barges.

Rail vehicles[edit]

North America

Under the names Gunderson LLC (Portland, Oregon), Gunderson-Concarril (Sahagun City, Mexico, in a former Concarril plant) and Gunderson GIMSA (Monclova, Mexico), both intermodal (60 percent market share) and conventional freight (30 percent market share) cars are produced.

Europe

Under the name Greenbrier Europe (plant in Świdnica, Poland), conventional freight cars (approximately twenty percent market share) are produced.

Repair/refurbishment[edit]

Subsidiaries Gunderson Rail Services LLC and Greenbrier Europe provide repair, refurbishment and component services for railcars in North America and Europe.

Leasing/management[edit]

Under the name Greenbrier Leasing Company, LLC, third parties can lease railcars from Greenbrier's 9,203 car fleet. Subsidiary Greenbrier Management Services manages a fleet of approximately 145,000 railcars, predominantly owned by third parties.

See also[edit]

References[edit]

  1. ^ "William A. Furman". people.forbes.com (Forbes). 
  2. ^ "Mark J. Rittenbaum". people.forbes.com (Forbes). 
  3. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", Chap. 1 & 2
  4. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", Chap. 3
  5. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", Chap. 4
  6. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", Chap. 5-6
  7. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", Chap. 7
  8. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", Chap. 9
  9. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", Chap. 10
  10. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", Chap. 10-11
  11. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", Chap. 13
  12. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", appendix Time Line
  13. ^ E.M. Lundquist et al, "Gunderson : A history of an Oregon company", Chap. 15-17
  14. ^ a b c Thomas Derdak; Tina Grant, "The Greenbrier Companies", section: Gunderson Inc. Acquired 1985
  15. ^ Thomas Derdak; Tina Grant, "The Greenbrier Companies", section: Origins of the Greenbrier Companies
  16. ^ Thomas Derdak; Tina Grant, "The Greenbrier Companies", section: Greenbrier Goes Public in 1994
  17. ^ "About the Greenbrier Companies". www.gbrx.com. Greenbrier Companies. Company Timeline : 1998. Retrieved 26 January 2011. 
  18. ^ "About the Greenbrier Companies". www.gbrx.com. Greenbrier Companies. Company Timeline : 2004. Retrieved 26 January 2011. 
  19. ^ "Greenbrier buys out partner in Mexican venture". Portland Business Journal. December 7, 2004. Retrieved 2013-12-24. 
  20. ^ "Greenbrier and GIMSA Form New Railcar Manufacturing Joint Venture". www.prnewswire.com (Press release). Greenbrier Companies. Retrieved 26 January 2011. 
  21. ^ "TrentonWorks railcar plant to close". www.cbc.ca (CBC News). 4 April 2007. [dead link]
  22. ^ "From NS Steel to Greenbrier to closure: A history of Trenton Steel". www.ngnews.ca (The News (New Glasgow)). 15 June 2007. [dead link]
  23. ^ "About the Greenbrier Companies". www.gbrx.com. Greenbrier Companies. Company Timeline : 2006 to 2008. Retrieved 26 January 2011. 
  24. ^ Sources:
  25. ^ (Press release) title= Carl Icahn offers $543M to buy Greenbrier accessdate=28 December 2012 http://www.bizjournals.com/portland/morning_call/2012/12/icahn-makes-an-offer-for-greenbrier-cos.html title= Carl Icahn offers $543M to buy Greenbrier accessdate=28 December 2012.  Missing or empty |title= (help)

Sources[edit]

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