Textron
Sent from my iPhone using Tapatalk
Made me google it, and sure enough!
in the 1970s
After its one stumble, the company grew rapidly in the boom years of the 1960s. So pronounced was the growth that it outstripped the management skills of the owners, who had to decide whether to hire professional managers or sell the company. In 1968 Polaris was sold to Textron, a diversified company holding E-Z Go golf carts, Bell helicopters, Talon zippers, and Schaefer pens. The company kept Polaris in Roseau and continued snowmobile manufacturing, but also began limited research and development on watercraft and wheeled turf vehicles. Herb Graves of Textron became president and Johnson stayed on as vice-president to oversee production.
During the 1970s Polaris began to solidify its reputation for high-performance snowmobiles. In pre-Textron years, Polaris had purchased its snowmobile engines from a number of suppliers. With the entry of Textron, Polaris was able to bring on Fuji Heavy Industries as its sole supplier. Fuji engineers went to Roseau to work on building a high-quality engine specifically for Polaris. Increasingly, the Polaris product lines were being noticed. The TX Series set a standard for power and handling in racing and gained popularity with recreational riders. Introduced in 1977, the liquid-cooled TX-L was a strong cross-country racing competitor. Polaris also introduced the RX-L in the mid-1970s, which carried the first Independent Front Suspension (IFS) and produced winners on the racing circuits shortly after its debut. The 1970s also marked the opening of corporate offices in Minneapolis, with product development and production staying up north.
The sport of snowmobiling grew by leaps and bounds in the early 1970s; enthusiasts in the snowbelts of the United States and Canada now numbered more than a million. The growth rate for the industry was 35 percent per year, versus 20 percent for other recreation industry manufacturers. In 1970, 63 companies manufactured snowmobiles in the United States, Canada, Europe, and Japan. Bombardier held 40 percent of the market, with an additional 40 percent shared by Arctic Cat, Polaris, Scorpion, and Sno Jet. About one-third of the machines manufactured in North America in the early 1970s were made in Minnesota.
Factory-backed racing teams found Polaris support in the days of Allan Hetteen and Textron, but the death of a Polaris team member in 1978 effectively ended the program. From 1981 on the company sponsored a modified racing program with independent racers. Hill climbs, stock and modified oval racing, snow and grass drag racing, and cross-country endurance racing tested the limits of the machines and appealed to customers. Racing was an important part of engineering research and development as well as public relations and product marketing.
Yet in the late 1970s, despite everything that favored the industry--including regular improvements in safety and an expanding trail system that would eventually rival the U.S. Interstate Highway System in total miles--the snowmobiling boom was about to go bust. Companies began shutting down or selling off their snowmobile divisions in the face of declining sales. Names such as Scorpion, AM, Harley-Davidson, Johnson & Evinrude, Chaparral, and Suzuki would no longer be seen on snowmobile nameplates. By 1980 even Arctic Enterprises, the number one manufacturer, was in trouble. High energy costs, economic recessions, snowless winters, and overexpansion eventually drove all but three manufacturers of snowmobiles out of business. Industry sales slid downhill from 500,000 units annually in the early 1970s to 316,000 in 1975; 200,000 in 1980; 174,000 in 1981; and 80,000 in 1983.
Management Buyout in 1981
Textron wanted out of the snowmobile business, too. Textron president Beverly Dolan, who had been president of Polaris during its first years with Textron, told Polaris's then-president, W. Hall Wendel, Jr., to sell off the company. A deal to sell the Polaris division to Canada's Bombardier fell through, however, because of the threat of antitrust action by the U.S. Department of Justice. Liquidation was on the horizon. This opened the door for a management group leveraged buyout led by Wendel, who believed that there was a market for snowmobiles and that seasonal snowfalls would rise again. Polaris Industries was created in July 1981, and a shutdown of the Roseau plant was avoided. (Still, the company began production with just 100 workers after the buyout.) Also at this time, plant workers voted the union out and Polaris proceeded to establish a Japanese labor model of worker participation, with a crew that had firsthand knowledge of the machines and their capabilities. Times were still tough, though: the 1982 product line consisted of the 1981 model with some detail changes, and barely more than 5,000 machines were built that season. The same year as the buyout, Polaris attempted to purchase Arctic Cat. When the deal failed, Arctic Cat shut down, leaving Polaris, at least for a while, as the only American snowmobile manufacturer.
The first years following the management buyout from Textron were lean and characterized by a skeleton factory crew and tight budgets. But the Textron debt was paid off ahead of schedule and the snowmobile line was expanded and improved. The company also expanded into Canada to become more price competitive and to create a stronger dealer network. Five years after the buyout the company had reached sales of $40 million and employed 450 people. A Polaris innovation of the early 1980s was the "Snow Check" early deposit program. Polaris encouraged its dealers with incentives to make spring deposits on machines for preseason delivery. For the first time snowmobiles were built to dealer orders rather than manufacturer forecasts, which had been resulting in excess inventory. Other factors helping the industry along at the time were advancements in clothing technology, winter resorts welcoming snowmobilers on winter vacations, and new engineering on the machines producing quieter, more reliable vehicles. By 1984 there were 20 million snowmobilers in the northern snowbelt and mountain regions using the vehicles for rescue and outdoor work as well as recreational and sporting events.
One of the highlights of the 1980s was the introduction of the Indy line of snowmobiles, which became so popular that other high-quality Polaris sleds, such as the Cutlass, were phased out. Good suspension, special features (such as handwarmers and reverse drive), powerful engines, and reliability all pushed Polaris into the number one position in the market. The Indy 500 was named the "sled of the decade" by Snowmobile magazine.
The 1990s and Beyond
Into the 1990s Polaris continued to improve the performance, ride, and reliability of its machines by introducing such features as the triple-cylinder and high-displacement engines, extra-long travel suspensions, and specialized shock absorbers. The machines of the 1990s were a long way from the industry's early noisy, pull-start models, with uncertain braking and questionable reliability. In 1990 Polaris held 30 percent of the snowmobile market, manufacturing 165,000 units. Arctco Inc. held 25 percent of the total market, followed by Yamaha and Ski-Doo (Bombardier, Inc.), both at 22.5 percent.
Just as the snow outside Polaris's doors had provided a proving ground for snowmobiles, the summertime swampland of the far north provided a place for testing wheeled turf vehicles. The company built and sold two-wheel tractor-tired bikes in the middle to late 1960s as it was testing diversification into such areas as lawn and garden products, single and two-person watercraft, and snowmobile-engined go-carts. The Textron acquisition and merger with E-Z Go golf carts ended formal ATV product development, so testing stayed underground until after the buyout. The company then tried but failed to sell private-label ATVs to other large companies. Still hoping to better utilize its manufacturing facilities, the company brought out two ATV designs, a three-wheel and a four-wheel with automatic shifting, which caught the interest and commitment of distributors. Added features such as racks and trailers appealed to farmers, ranchers, and lawn maintenance workers. ATVs made perfect sense for Polaris in that they shared engines and clutches with snowmobiles, could be marketed through the same dealers, and represented a seasonal line manufactured in fall and winter months for sale in the summer, just the opposite of snowmobiles.
When Polaris entered the ATV market all the major manufacturers were Japanese, led by Honda. Polaris ATVs, a combination recreation-utility vehicle, avoided direct competition with the leaders. The majority of the two million ATVs in use in the mid-1980s was in the United States and Canada. The first production run of the Polaris ATVs was a resounding success and quickly sold out to dealers. Eventually, production of three-wheel vehicles would be curtailed by all manufacturers, in response to reports of rising accidents and deaths and action by the Consumer Product Safety Commission. Polaris ceased manufacture of its three-wheel adult version after its first year of ATV production. In 1990 the retail cost of a four-wheel ATV ranged from $2,400 to $4,000 and Polaris controlled about seven percent of a shrinking market. By the end of 1993, however, ATV sales made up 26 percent of entire sales by product line. ATV manufacture was now year-round, with a dedicated production line, and had the potential to surpass snowmobile production. Because of marketing and distribution that now extended beyond the snowbelt to tractor, lawn and garden, used car, and motorcycle dealers, Polaris had become a key national as well as international player in the broader market of recreational vehicles.
