AVX Corporation
Encyclopedia
AVX Corporation a 71 percent owned subsidiary of Kyocera Electronics Corporation
, is a manufacturer of electronic component
s headquartered in Greenville, South Carolina
. It is the largest industrial employer in Horry County, South Carolina
, with almost 1000 workers in Myrtle Beach and Conway
. AVX has 9,900 employees and operates in the United States
, Europe
and Asia
. 2009 sales were $1.4 billion. Capital expenditure for the year 2010 was at a five year low of $28.888 million 34.6% lower than the year before and 2.5 times less than in 2008, earnings per share grew 78.7% even though total sales fell (although revenue grew with each successive quarter since April 2009)
, cell phones, copiers, hearing aid
s, and locomotive
s. KED Resale sells Kyocera products including ceramic
and tantalum capacitor
s. Connectors are used in the automotive
and medical
industries.
Major customers of AVX include Motorola
, Nokia
and Robert Bosch GmbH
.
Asia accounts for 45 percent of AVX sales.
Butler cofounded Alloys Unlimited Inc. in 1957, which was sold to London-based Plessey Co.
in 1970; Butler stayed for several years as president of the Plessey subsidiary. With his experience in the semiconductor
field, Butler decided AVX should emphasize multilayer ceramic capacitors (MLCs), used in the rapidly expanding integrated circuit
field. Butler sold two other divisions and started a five-year plan. The company's $20 million investment and careful analysis of the market resulted in 1979 sales of $95 million and dominance of the market; the goal, based on 30 percent annual growth, had been $83 million.
AVX added operations in Europe, but moving into Japan
proved more difficult. The company's license would not let it sell in Japan, but Kyocera Corporation could sell its products in the United States. Kyocera CEO Kazuo Inamori agreed with Butler that the situation needed to be changed, and Kyocera ended the unfair provision. In 1979 AVX started a Japanese subsidiary.
During the 1980s, growth continued, with 1984 sales reaching $234 million. But that year, it became clear that computer
manufacturers had bought more capacitors than needed, and a slowdown began in the industry. AVX continued to grow through new product research and buying other companies. By the end of the decade sales reached $450 million.
In the late 1980s, the European operations of AVX represented one-fourth of sales. AVX wanted to manufacture parts for Kyocera, which had only 2 percent of its sales in Europe and hoped to increase that before the European Community made that more difficult. Inamori wanted to buy AVX rather than partner with the company. After a $267 million stock
purchase, AVX has operated as part of Kyocera Corp. since January 18, 1990.
Butler retired as CEO in 1993 but remained on the board of directors
. Benedict P. Rosen, an employee since the company's start, became the new CEO. By 1995, sales reached almost $1 billion after significant growth for personal computer
s and cell phones. At the same time, the automotive, home appliance
and medical industries needed electronic components, and advanced electronic systems needed capacitors as well. AVX also sold Kyocera products worldwide and helped the company start operations in Mexico
and Indonesia
. Kyocera helped AVX start manufacturing connectors.
In 1995, Kyocera sold one-fourth of AVX for $557 million, which more than returned the company's investment in AVX, even though Kyocera still owned three-fourths of the company. AVX used the money to enter the connector business and increase its manufacturing of ceramic and tantalum capacitors.
The boom in the capacitor industry once again proved temporary, after customers bought more products than they needed. But in 1998, personal computers and cell phones contributed to more growth, as did newer electronics in cars. At the same time, material prices went up, and an Asian currency crisis added to AVX's troubles. Layoffs resulted, but by 2000 the company was doing well again, adding operations in El Salvador
and the Czech Republic
.
By the end of fiscal 2001, AVX had 26 plants in 12 countries, 21,000 employees, and sales of $2.6 billion. But a recession
put an end to the good times, and revenues dropped to $1.25 billion; employee numbers totalled 12,500. Production moved to the Czech Republic in the late 90's and China
from 2005 onwards.
The industry situation appeared to improve by 2004, though AVX still lost money.
In 2007, Myrtle Beach property owners near the AVX plant filed suit, claiming trichloroethylene
(TCE) used at the plant until the 1980s has polluted their neighborhood and lowered property values. Another lawsuit claimed the pollution had stopped a condominium
development in the area. A consultant for one of the land owners, Horry Land Co., discovered the pollution in 2006 while doing environmental testing prior to development of a portion of the land. In 2009, AVX claimed Myrtle Beach Air Force Base
caused at least part of the pollution, and the company added the air force
to one of several lawsuits. A geologist for AVX claims the pollution can be cleaned up in five years and Horry Land is not entitled to compensation, while the consultant for Horry Land claims there is no way to tell how long cleanup will take, since AVX has been trying to clean up its own pollution for 28 years.
In April 2009 the company decided to close a number of its smaller worldwide factories including its flagship manufacturing plant in Paignton, UK following the credit crunch in a effort to reduce costs and remain financially viable for shareholders.
On December 3, 2009, AVX announced it would move corporate headquarters to Greenville, South Carolina, with about 150 jobs leaving the Myrtle Beach area. The company planned no change to manufacturing in Conway and Myrtle Beach.
On February 22, 2010, federal judge Terry Wooten ruled that evidence in the Horry Land suit showed the plaintiffs were entitled to a trial. On February 23, 2011, the trial began in Florence, South Carolina
. In May 2011, Wooten ruled that AVX caused the pollution, and county property records show that AVX purchased the contaminated land.
In 2011, AVX announced plans to tear down the original Myrtle Beach plant built in 1949 and updated in 1985, with manufacturing operations continuing at a nearby location on the same land.
Kyocera
is a multinational manufacturer based in Kyoto, Japan. It was founded as in 1959 by Kazuo Inamori and renamed in 1982. The company has diversified its founding technology in ceramic materials through internal development as well as strategic mergers and acquisitions...
, is a manufacturer of electronic component
Electronic component
An electronic component is a basic electronic element and may be available in a discrete form having two or more electrical terminals . These are intended to be connected together, usually by soldering to a printed circuit board, in order to create an electronic circuit with a particular function...
s headquartered in Greenville, South Carolina
Greenville, South Carolina
-Law and government:The city of Greenville adopted the Council-Manager form of municipal government in 1976.-History:The area was part of the Cherokee Nation's protected grounds after the Treaty of 1763, which ended the French and Indian War. No White man was allowed to enter, though some families...
. It is the largest industrial employer in Horry County, South Carolina
Horry County, South Carolina
Horry County is a county located in the U.S. state of South Carolina. This name honored Revolutionary War Hero, Peter Horry. Brigadier General Horry was born in South Carolina sometime around 1743 and started his distinguished military career in 1775 as one of 20 captains the Provincial Congress...
, with almost 1000 workers in Myrtle Beach and Conway
Conway, South Carolina
Conway is a city in Horry County, South Carolina, United States. The population was 16,317 at the 2010 census. It is the county seat of Horry County and is part of the Myrtle Beach metropolitan area. It is the home of Coastal Carolina University....
. AVX has 9,900 employees and operates in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, Europe
Europe
Europe is, by convention, one of the world's seven continents. Comprising the westernmost peninsula of Eurasia, Europe is generally 'divided' from Asia to its east by the watershed divides of the Ural and Caucasus Mountains, the Ural River, the Caspian and Black Seas, and the waterways connecting...
and Asia
Asia
Asia is the world's largest and most populous continent, located primarily in the eastern and northern hemispheres. It covers 8.7% of the Earth's total surface area and with approximately 3.879 billion people, it hosts 60% of the world's current human population...
. 2009 sales were $1.4 billion. Capital expenditure for the year 2010 was at a five year low of $28.888 million 34.6% lower than the year before and 2.5 times less than in 2008, earnings per share grew 78.7% even though total sales fell (although revenue grew with each successive quarter since April 2009)
Products
AVX has three business units. Passive Components includes electrical components for automotive brakingVehicle brake
A vehicle brake is a brake used to slow down a vehicle by converting its kinetic energy into heat. The basic hydraulic system, most commonly used, usually has six main stages...
, cell phones, copiers, hearing aid
Hearing aid
A hearing aid is an electroacoustic device which typically fits in or behind the wearer's ear, and is designed to amplify and modulate sound for the wearer. Earlier devices, known as "ear trumpets" or "ear horns", were passive funnel-like amplification cones designed to gather sound energy and...
s, and locomotive
Locomotive
A locomotive is a railway vehicle that provides the motive power for a train. The word originates from the Latin loco – "from a place", ablative of locus, "place" + Medieval Latin motivus, "causing motion", and is a shortened form of the term locomotive engine, first used in the early 19th...
s. KED Resale sells Kyocera products including ceramic
Ceramic capacitor
In electronics, a ceramic capacitor is a capacitor constructed of alternating layers of metal and ceramic, with the ceramic material acting as the dielectric. The temperature coefficient depends on whether the dielectric is Class 1 or Class 2...
and tantalum capacitor
Tantalum capacitor
The tantalum capacitor is a highly reliable type of electrolytic capacitor, available in both solid-bodied and separately encased forms. The encased "wet" variant is not used often in modern designs...
s. Connectors are used in the automotive
Automotive industry
The automotive industry designs, develops, manufactures, markets, and sells motor vehicles, and is one of the world's most important economic sectors by revenue....
and medical
Medicine
Medicine is the science and art of healing. It encompasses a variety of health care practices evolved to maintain and restore health by the prevention and treatment of illness....
industries.
Major customers of AVX include Motorola
Motorola
Motorola, Inc. was an American multinational telecommunications company based in Schaumburg, Illinois, which was eventually divided into two independent public companies, Motorola Mobility and Motorola Solutions on January 4, 2011, after losing $4.3 billion from 2007 to 2009...
, Nokia
Nokia
Nokia Corporation is a Finnish multinational communications corporation that is headquartered in Keilaniemi, Espoo, a city neighbouring Finland's capital Helsinki...
and Robert Bosch GmbH
Robert Bosch GmbH
Robert Bosch GmbH is a multinational engineering and electronics company headquartered in Gerlingen, near Stuttgart, Germany. It is the world's largest supplier of automotive components...
.
Asia accounts for 45 percent of AVX sales.
History
AVX began in 1972 making ceramic capacitors as a subsidiary of Aerovox Corporation, a company founded in 1922 as Radiola Wireless Corporation, which made radios. In June 1973, AVX became the parent company when assets of Aerovox were sold. That same year, Marshall D. Butler, who played a major role in the company's growth, became chairman and CEO.Butler cofounded Alloys Unlimited Inc. in 1957, which was sold to London-based Plessey Co.
Plessey
The Plessey Company plc was a British-based international electronics, defence and telecommunications company. It originated in 1917, growing and diversifying into electronics. It expanded after the second world war by acquisition of companies and formed overseas companies...
in 1970; Butler stayed for several years as president of the Plessey subsidiary. With his experience in the semiconductor
Semiconductor
A semiconductor is a material with electrical conductivity due to electron flow intermediate in magnitude between that of a conductor and an insulator. This means a conductivity roughly in the range of 103 to 10−8 siemens per centimeter...
field, Butler decided AVX should emphasize multilayer ceramic capacitors (MLCs), used in the rapidly expanding integrated circuit
Integrated circuit
An integrated circuit or monolithic integrated circuit is an electronic circuit manufactured by the patterned diffusion of trace elements into the surface of a thin substrate of semiconductor material...
field. Butler sold two other divisions and started a five-year plan. The company's $20 million investment and careful analysis of the market resulted in 1979 sales of $95 million and dominance of the market; the goal, based on 30 percent annual growth, had been $83 million.
AVX added operations in Europe, but moving into Japan
Japan
Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south...
proved more difficult. The company's license would not let it sell in Japan, but Kyocera Corporation could sell its products in the United States. Kyocera CEO Kazuo Inamori agreed with Butler that the situation needed to be changed, and Kyocera ended the unfair provision. In 1979 AVX started a Japanese subsidiary.
During the 1980s, growth continued, with 1984 sales reaching $234 million. But that year, it became clear that computer
Computer
A computer is a programmable machine designed to sequentially and automatically carry out a sequence of arithmetic or logical operations. The particular sequence of operations can be changed readily, allowing the computer to solve more than one kind of problem...
manufacturers had bought more capacitors than needed, and a slowdown began in the industry. AVX continued to grow through new product research and buying other companies. By the end of the decade sales reached $450 million.
In the late 1980s, the European operations of AVX represented one-fourth of sales. AVX wanted to manufacture parts for Kyocera, which had only 2 percent of its sales in Europe and hoped to increase that before the European Community made that more difficult. Inamori wanted to buy AVX rather than partner with the company. After a $267 million stock
Stock
The capital stock of a business entity represents the original capital paid into or invested in the business by its founders. It serves as a security for the creditors of a business since it cannot be withdrawn to the detriment of the creditors...
purchase, AVX has operated as part of Kyocera Corp. since January 18, 1990.
Butler retired as CEO in 1993 but remained on the board of directors
Board of directors
A board of directors is a body of elected or appointed members who jointly oversee the activities of a company or organization. Other names include board of governors, board of managers, board of regents, board of trustees, and board of visitors...
. Benedict P. Rosen, an employee since the company's start, became the new CEO. By 1995, sales reached almost $1 billion after significant growth for personal computer
Personal computer
A personal computer is any general-purpose computer whose size, capabilities, and original sales price make it useful for individuals, and which is intended to be operated directly by an end-user with no intervening computer operator...
s and cell phones. At the same time, the automotive, home appliance
Home appliance
Home appliances are electrical/mechanical machines which accomplish some household functions, such as cooking or cleaning. Home appliances can be classified into:*Major appliances, or White goods*Small appliances, or Brown goods...
and medical industries needed electronic components, and advanced electronic systems needed capacitors as well. AVX also sold Kyocera products worldwide and helped the company start operations in Mexico
Mexico
The United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...
and Indonesia
Indonesia
Indonesia , officially the Republic of Indonesia , is a country in Southeast Asia and Oceania. Indonesia is an archipelago comprising approximately 13,000 islands. It has 33 provinces with over 238 million people, and is the world's fourth most populous country. Indonesia is a republic, with an...
. Kyocera helped AVX start manufacturing connectors.
In 1995, Kyocera sold one-fourth of AVX for $557 million, which more than returned the company's investment in AVX, even though Kyocera still owned three-fourths of the company. AVX used the money to enter the connector business and increase its manufacturing of ceramic and tantalum capacitors.
The boom in the capacitor industry once again proved temporary, after customers bought more products than they needed. But in 1998, personal computers and cell phones contributed to more growth, as did newer electronics in cars. At the same time, material prices went up, and an Asian currency crisis added to AVX's troubles. Layoffs resulted, but by 2000 the company was doing well again, adding operations in El Salvador
El Salvador
El Salvador or simply Salvador is the smallest and the most densely populated country in Central America. The country's capital city and largest city is San Salvador; Santa Ana and San Miguel are also important cultural and commercial centers in the country and in all of Central America...
and the Czech Republic
Czech Republic
The Czech Republic is a landlocked country in Central Europe. The country is bordered by Poland to the northeast, Slovakia to the east, Austria to the south, and Germany to the west and northwest....
.
By the end of fiscal 2001, AVX had 26 plants in 12 countries, 21,000 employees, and sales of $2.6 billion. But a recession
Early 2000s recession
The early 2000s recession was a decline in economic activity which occurred mainly in developed countries. The recession affected the European Union mostly during 2000 and 2001 and the United States mostly in 2002 and 2003. The UK, Canada and Australia avoided the recession for the most part, while...
put an end to the good times, and revenues dropped to $1.25 billion; employee numbers totalled 12,500. Production moved to the Czech Republic in the late 90's and China
China
Chinese civilization may refer to:* China for more general discussion of the country.* Chinese culture* Greater China, the transnational community of ethnic Chinese.* History of China* Sinosphere, the area historically affected by Chinese culture...
from 2005 onwards.
The industry situation appeared to improve by 2004, though AVX still lost money.
In 2007, Myrtle Beach property owners near the AVX plant filed suit, claiming trichloroethylene
Trichloroethylene
The chemical compound trichloroethylene is a chlorinated hydrocarbon commonly used as an industrial solvent. It is a clear non-flammable liquid with a sweet smell. It should not be confused with the similar 1,1,1-trichloroethane, which is commonly known as chlorothene.The IUPAC name is...
(TCE) used at the plant until the 1980s has polluted their neighborhood and lowered property values. Another lawsuit claimed the pollution had stopped a condominium
Condominium
A condominium, or condo, is the form of housing tenure and other real property where a specified part of a piece of real estate is individually owned while use of and access to common facilities in the piece such as hallways, heating system, elevators, exterior areas is executed under legal rights...
development in the area. A consultant for one of the land owners, Horry Land Co., discovered the pollution in 2006 while doing environmental testing prior to development of a portion of the land. In 2009, AVX claimed Myrtle Beach Air Force Base
Myrtle Beach Air Force Base
Myrtle Beach Air Force Base is a closed United States Air Force facility, located in Myrtle Beach, South Carolina. It was established in 1940 as a World War II training base and was also used for coastal patrols during the war...
caused at least part of the pollution, and the company added the air force
United States Air Force
The United States Air Force is the aerial warfare service branch of the United States Armed Forces and one of the American uniformed services. Initially part of the United States Army, the USAF was formed as a separate branch of the military on September 18, 1947 under the National Security Act of...
to one of several lawsuits. A geologist for AVX claims the pollution can be cleaned up in five years and Horry Land is not entitled to compensation, while the consultant for Horry Land claims there is no way to tell how long cleanup will take, since AVX has been trying to clean up its own pollution for 28 years.
In April 2009 the company decided to close a number of its smaller worldwide factories including its flagship manufacturing plant in Paignton, UK following the credit crunch in a effort to reduce costs and remain financially viable for shareholders.
On December 3, 2009, AVX announced it would move corporate headquarters to Greenville, South Carolina, with about 150 jobs leaving the Myrtle Beach area. The company planned no change to manufacturing in Conway and Myrtle Beach.
On February 22, 2010, federal judge Terry Wooten ruled that evidence in the Horry Land suit showed the plaintiffs were entitled to a trial. On February 23, 2011, the trial began in Florence, South Carolina
Florence, South Carolina
-Municipal government and politics:The City of Florence has a council-manager form of government. The mayor and city council are elected every four years, with no term limits...
. In May 2011, Wooten ruled that AVX caused the pollution, and county property records show that AVX purchased the contaminated land.
In 2011, AVX announced plans to tear down the original Myrtle Beach plant built in 1949 and updated in 1985, with manufacturing operations continuing at a nearby location on the same land.