KONE
Overview
 
Kone Oyj founded in 1910 and headquartered in Espoo
Espoo
Espoo is the second largest city and municipality in Finland. The population of the city of Espoo is . It is part of the Helsinki Metropolitan Area along with the cities of Helsinki, Vantaa, and Kauniainen. Espoo shares its eastern border with Helsinki and Vantaa, while enclosing Kauniainen....

, Finland
Finland
Finland , officially the Republic of Finland, is a Nordic country situated in the Fennoscandian region of Northern Europe. It is bordered by Sweden in the west, Norway in the north and Russia in the east, while Estonia lies to its south across the Gulf of Finland.Around 5.4 million people reside...

, is an international engineering and service company employing some 32,500 personnel worldwide. The firm is the fourth largest manufacturer of elevator
Elevator
An elevator is a type of vertical transport equipment that efficiently moves people or goods between floors of a building, vessel or other structures...

s worldwide, a leading manufacturer of escalators, and also provides maintenance services and modernization solutions. In addition, Kone builds and services automatic doors and gates. The company provides local service for builders, developers, building owners, designers and architects in 800 locations in over 40 countries.
Encyclopedia
Kone Oyj founded in 1910 and headquartered in Espoo
Espoo
Espoo is the second largest city and municipality in Finland. The population of the city of Espoo is . It is part of the Helsinki Metropolitan Area along with the cities of Helsinki, Vantaa, and Kauniainen. Espoo shares its eastern border with Helsinki and Vantaa, while enclosing Kauniainen....

, Finland
Finland
Finland , officially the Republic of Finland, is a Nordic country situated in the Fennoscandian region of Northern Europe. It is bordered by Sweden in the west, Norway in the north and Russia in the east, while Estonia lies to its south across the Gulf of Finland.Around 5.4 million people reside...

, is an international engineering and service company employing some 32,500 personnel worldwide. The firm is the fourth largest manufacturer of elevator
Elevator
An elevator is a type of vertical transport equipment that efficiently moves people or goods between floors of a building, vessel or other structures...

s worldwide, a leading manufacturer of escalators, and also provides maintenance services and modernization solutions. In addition, Kone builds and services automatic doors and gates. The company provides local service for builders, developers, building owners, designers and architects in 800 locations in over 40 countries. Since 1924, Kone has been owned by one of Finland's wealthiest families, the Herlin family. After Harald Herlin purchased the company in 1924, he served as its Chairman until 1941. Afterwards, his son, Heikki H. Herlin, took over his father's post from 1941–1987. Control of the company was then handed down to his son, Pekka Herlin, which he retained from 1987–2003. The current Chairman of Kone's Board of Directors from 2003 onwards is Antti Herlin
Antti Herlin
Antti Herlin is the current and fourth chairman of the Board of Finnish KONE Corporation. He is the richest man in Finland with assets worth nearly 1 billion euros in KONE stock owned through his holding companies. He is the son of Pekka Herlin, former chairman of the board of KONE as well...

.

1910–1964

Kone (then known as Osakeyhtiö Kone Aktiebolag) was founded in 1910 as a subsidiary of Gottfr. Strömberg Oy. Strömberg's license to import Graham Brothers elevators was transferred to the new company. Kone sold just a few units before terminating the licensing agreement in 1917. Kone, then a company with only 50 employees, started to make and install its own elevators in 1918. Six years later, in 1924, entrepreneur Harald Herlin bought Kone from Strömberg and became the new chairman of the company's Board of Directors. His son, Heikki Herlin, joined the company and was appointed technical director in 1928. His office was located in a former margarine factory on Haapaniemi Street in Helsinki that Kone had bought and converted into an elevator production facility the previous year. Heikki Herlin took over as Kone's president in 1932. Kone's first foreign subsidiary - AB Kone Hissar of Sweden - was established in 1957.

After World War II, Kone was called upon by the Finnish government to contribute elevators, electric hoists and cranes to the war reparations
War reparations
War reparations are payments intended to cover damage or injury during a war. Generally, the term war reparations refers to money or goods changing hands, rather than such property transfers as the annexation of land.- History :...

 being paid to the Soviet Union. This program forced Kone to expand its capacity, rationalize production processes and learn to meet demanding manufacturing schedules. In the 1950s Kone introduced its first group controls, automatic doors and hydraulic elevators. Heikki Herlin turned over the president's duties in 1964 to his son, Pekka, who had served as administrative director since 1958.

1965–1998

Kone opened a purpose-built elevator factory in 1966 in Hyvinkää
Hyvinkää
Hyvinkää is a town and municipality of Finland. It is located in Uusimaa region, approximately north of the capital Helsinki. The town was chartered in 1960. Hyvinkää belongs to the Province of Southern Finland. The population of Hyvinkää is ....

, Finland. The following year Kone was listed on the Helsinki Exchanges and started its international expansion through the acquisition of Sweden's Asea-Graham and its Norwegian and Danish affiliates. Numerous acquisitions followed during the 1970s and 1980s with only the most significant being listed here. The acquisitions of companies larger and older than Kone itself has been seen to have brought Kone respectability and lifted the company to a position of market prominence. Eventually Kone further expanded its business scope. The company became one of the world's largest hoist and crane manufacturers as well as a producer of high-tech electronic hospital and laboratory equipment.
In 1981 Kone entered the American elevator market with the acquisition of New York City based Armor Elevator Company, which it continued to operate independently as a wholly owned subsidiary. The addition of Navire Cargo Gear in 1982 and International MacGregor a year later made Kone number one worldwide in shipboard cargo access equipment. Wood-handling systems and equipment for pulp and paper mills, hydraulic piping systems, mining equipment and conveyors, and specialized steel components from Kone's own steel foundry rounded out the company's offerings to industrial customers. In 1987, after 60 years as a member of Kone's board of directors and 46 as its chairman, Heikki Herlin retired. Prevented by Finnish law from serving simultaneously as president and board chairman, Pekka Herlin ceded the presidency to Matti Matinpalo, the first non-Herlin to occupy the position in 55 years, and continued as Chairman of the Board.

Although Kone's business had been thriving leading up to 1987, by 1990, global recession had set in, which led Kone to sell its shipboard cargo handling business in 1993, as well as its crane, wood handling and piping systems businesses in 1994, and finally the steel foundry and electronic medical instruments divisions in 1995. Only its elevators, escalators, and automatic door branches remained. Kone acquired the Montgomery Elevator Company of the U.S. in 1994, which made the Finnish company a major player in North America. Soon afterwards, the Kone Corporation purchased a majority of the outstanding shares of O&K Rolltreppen GmbH of Germany. These lucrative acquisitions made Kone the world's leading supplier of escalators and autowalks
Moving walkway
A moving walkway or moving sidewalk is a slow moving conveyor mechanism that transports people, across a horizontal...

. After expanding in both North America and Europe, the company sought to stregnthen its presence in Asia. The Finnish manufacturer achieved this in 1998 through a major, $29 million (US) investment in the construction of an elevator and escalator factory in Kunshan, China.

In 1996, Antti Herlin, the great-grandson of the company's founder, was appointed Kone CEO and deputy chairman of the board of the company that he had now inherited. The company introduced new technology such as the Kone EcoDisc hoisting machine and the Kone MonoSpace elevator technology concept in 1996. These technologies produced a shift in the elevator manufacturing business, as Kone was one of the first to introduce machine-room-less (MRL) construction in elevators. Kone's novel MRL designs significantly reduced the size of elevator machinery and its lift mechanism by using permanent magnet motors (PMM). The use of these smaller and more energy-efficient (can save up to an estimated 70-80% more electricity than hydraulic-lift elevators) mechanisms enables all of the elevator's equipment and its inner workings to be confined entirely in the space above the elevator shaft, known as the hoistway overhead instead of needing an entire room dedicated to machinery. At the beginning of the 21st Century, due to the apparent benefits of Kone's pioneering elevator systems, rival companies began competitively marketing machine-room-less elevators of their own.

1999–2007

The company faced several problems in the new millennium due to an unexpected slowdown in the elevator industry as a result of increased international competition due to over-consolidation, resulting in few independently-owned mid-sized companies left in Europe and America. Furthermore, worldwide economic downturn reduced construction activity, and modernization of elevators in aging buildings has been slower than predicted. Kone's chairman of the board, Pekka Herlin, died on April 4, 2003 after a long illness. Antti Herlin
Antti Herlin
Antti Herlin is the current and fourth chairman of the Board of Finnish KONE Corporation. He is the richest man in Finland with assets worth nearly 1 billion euros in KONE stock owned through his holding companies. He is the son of Pekka Herlin, former chairman of the board of KONE as well...

 was subsequently appointed the new chairman of the board in June 2003. Matti Alahuhta, a former Executive Vice President at Nokia Corporation, previously serving as the President of Nokia Mobile Phones, was later chosen to fill Herlin's vacant position as the acting President of the Kone Corporation. He has held the position since 2005, officially becoming the firm's President and CEO in 2006.

Unlike the elevator business, the automatic building door service business, which Kone had entered on a small-scale in France in 1980, had not yet experienced such consolidation that plagued the elevator business. Kone made a few strategic acquisitions and alliances and soon became the leading company in the field. In 2002, Kone acquired Partek, a Finnish industrial engineering company with net sales equal to Kone's. Partek's business areas specialized in container handling, load handling, forest machinery and tractors. The tractors were manufactured under the Valtra
Valtra
Valtra is a Finnish based manufacturer of tractors owned by the AGCO Corporation.-History:Valtra traces its origin to Valmet, Bolinder, Munktell and Volvo. Bolinder-Munktell merged with Volvo in 1950 to form BM Volvo. In 1979, BM Volvo/Volvo BM and Valmet formed a joint venture for tractor...

 brand. The Kone Materials Handling division thus comprised these Partek business areas.

In 2003, Kone decided to concentrate on Container Handling and Load Handling and the tractor and forest machine businesses were sold. The Valtra tractor business was sold to AGCO
AGCO
AGCO is an agricultural equipment manufacturer based in Duluth, Georgia, USA. As a leading global manufacturer of agricultural equipment, AGCO offers a full line of tractors, combines, hay tools, sprayers, forage and tillage equipment, which are distributed through more than 2,700 independent...

, a worldwide agricultural manufacturer. As the structure of Kone Materials Handling had changed significantly, the name Kone Cargotec was introduced in January 2004. Its business areas were Kalmar (container handling) and HIAB (load handling).

At the end of 2004, Kone Cargotec acquired MacGREGOR, a global marine cargo-flow solution and service provider, thereby adding the leading market position in shipboard cargo-handling solutions to its existing market leadership in container handling and load handling.

In August 2004 the Kone Board of Directors presented a plan to split the company into two separately listed companies on the Helsinki Stock Exchanges in June, 2005. One company would comprise Kone's existing elevator, escalator & building door service business and continue to operate under the name Kone Corporation. The other company would comprise Kone Cargotec’s business area and operate under the name Cargotec Corporation. The Extraordinary Shareholders’ Meeting in December 2004 approved the Demerger Plan. The demerger was completed in June 2005.

In September 2007 it was announced that Kone is proposing to lease several floors of a new riverfront tower to be built on Bass Street Landing, which is part of the Moline Riverfront.

Also in 2007, it was announced Kone had received part of what was then the largest fine ever handed out by the EU Commission for local anticompetitive behavior in the elevator and escalator markets in Belgium, Germany, Luxembourg and the Netherlands relating to time prior to mid-2004 (the commission stated that it could only prove its case back to 1995, though evidence allegedly suggested the abuse had started much earlier). Kone has appealed against the size of the fine, currently 142 million EUR. In total, the industry received 1 billion EUR fine for cartel activity across Belgium, Germany, Luxembourg and the Netherlands.

Finally, in 2007, Kone announced that they would stop production of hydraulic elevators, replacing them with the EcoSpace MRL elevators, due to the hydraulic elevators' inefficient energy consumption, contamination concerns regarding the use of hydraulic oil and buried cylinders, and other environmental concerns. Therefore, Kone has become the first major brand elevator company to make only traction elevators.
http://www.kone.com/countries/en_US/Elevators/Hydraulic/Pages/default.aspx

Significant alliances and acquisitions

  • 1981 – Kone enters the United States market by acquiring Armor Elevator Co.
  • 1985 – the acquisition of Montgomery Elevator's Canadian subsidiary opens an alliance with Montgomery in the U.S. that leads to the total integration of Montgomery into the Kone organization after 1994.
  • 1995 – an alliance was formed as Kone and MacGregor worked together to create elevators for handling passenger traffic on modern cruise ships. This alliance commands the leading position in marine elevator market.
  • 1998 – Kone's alliance initiated with Toshiba of Japan.
  • 2001 – Kone-Toshiba alliance is strengthened as the companies signed a historic agreement to exchange shares and extend Toshiba's license to market elevators based on Kone EcoDisc technology.
  • 2002 – Kone acquires the industrial engineering company Partek
  • 2005 – Kone acquires Stewart Moskal from rival Schindler Elevator
  • 2007 – Kone announces they will no longer make hydraulic elevators.
  • 2009 – Kone acquires Fairway Elevator Company in Philadelphia to enter the modernization market in that area.
The source of this article is wikipedia, the free encyclopedia.  The text of this article is licensed under the GFDL.
 
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