Let's Talk Trash-news


Let’s Talk Trash! MARCH/APRIL 2018

©2018 The Keenan Group, Inc

This article is a continuing story taken from A.O. Smith’s History Book printed © 2015. The purpose is to educate and inform our kids!

is more than just Water Heaters! A. O. Smith has been in operation for over 140 years having started in 1874 by Charles Jeremiah Smith. He made hardware parts for baby carriages and bicycles, and so much more!

Story continues... The use of enamel or glass type of coating & more. Post war 1945, A.O. Smith team had the product they wanted to launch, the water heater . Early in 1945, the company had conducted a story of its water heater business. There had been promising signs the glass-lined units in 1946 up to 1.3 million units in 1950, according to the U.S. Bureau of Labor Statistics. Thus shiny new water heaters were installed in each of these new homes as young families clamored for the convenience of hot water. After the war, A.O. Smith renewed its marketing agreement with Sears Roebuck, supplying the retailer with gas-fired or electric zinc-lined economy water heaters and premium glass-lined products carrying the Homart brand name. A.O. Smith began marketing its own water heaters using the Duraclad brand for zinc-lined products and Permaglas for the glass-lined units. By 1952, Sears Roebuck and A.O. Smith no longer offered a zinc product, placing all their resources behind the glass-lined products. had expired. (see page 21 for “patent”) By the early 60’s the five largest water heater manufacturers had capured 50% of the market, and the number of competitors overall was contracting. Industry sales, as a whole, had increased to 3.5 million units per year by 1965, but now two-thirds of the demand was for replacement water heaters. Competitive pressure in the industry caused the decision for A.O. Smith and Sears Roebuck to part ways. Shortly thereafter, the Sears water heater business was picked up by a privately held company in Tennessee, State Industries.

It was not until December 28, 2001 that A.O. Smith acquired State Industries that not only doubled the size of A.O. Smith’s water heater business, it moved the company into the retail segment for the first time in more than 30 years. State Industries brought additional commercial volume and manufactured pump tanks for the retail market segment. They also had a subsidiary APOM Inc., in nearby Franklin, Tennessee, that made a wide range of water heater components -- not just for State but for a number of water heater manufacturers including A.O. Smith. A.O. Smith was now running neck-and-neck with Rheem to vie for the title of North America’s largest water heater manufacturer, a position it had not enjoyed since the 1950s. From a simple shoe last to fabricating baby carriage and bicycle parts in the 1800s, the ‘roots’ of A.O. Smith over generations has grown into a global manufacture for many industries: automotive, oil and gas, breweries, transportation, military, agriculture, residential retail, elevators, and so many more. See next issue for discussion and analysis about A.O. Smith’s Automotive sale and how to structure the new A.O. Smith, or “newco” as some people called it by Rick Amburgey.

October 1958, the Permaglas division diversified and began manufacturing water softeners, which allowed the company to expand in the rapidly growing wholesale plumbing market channel. “Now, you people are making glass-lined beer tanks and glass-lined

water heater would have

a market, however,

the war had interrupted those plans. For the production of water heaters, A.O.Smith needed a plant location close to sources of steel and the ability to support nationwide distribution for its consumer product. The company broke ground in Kankakee, Il in the fall and by the following year water heaters started to come off the line. According to Life Magazine this facility was a “model of civilian production,” and the most efficient factory of its kind in the world. The housing market took off like a rocket in the late 1940s - new home construction increased from 647,000

water heaters,” [sic] “Why not a steel silo coated on the inside with glass? There’d be no pitting, thus a big reduction in spoilage.”

Glass lined tanks also served beneficial in the farm industry for dry storage structures. Premaglas units were used to store feed. It was a unique approach and so different to the traditional silos as the oxygen-limiting unit did indeed retard spoilage, and the issue of feed freezing inside a concrete structure was eliminated. Cattle ate more from this silage than they would from a conventional silo, as a result, milk output increased dramatically. In the 60s, the residential water heater industry was proving much more volatile when A.O. Smith’s patents for the glass lining process

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