Outboard Marine Corporation (OMC) was a maker of Evinrude, Johnson and Gale Outboard Motors, and many different brands of boats. It was a multibillion-dollar Fortune 500 corporation. Evinrude began in Milwaukee, Wisconsin in 1907. OMC was based in Waukegan, Illinois. They also owned several lines of boats such as Chris Craft, Lowe Boats, Princecraft, Four Winns, SeaSwirl, Stratos, and Javelin. OMC was also a parent company to Lawn-Boy and Ryan, which made lawn mowers, and Pioneer, a chainsaw company.
OMC sold 100,000 motors in 2000 and had one third of the outboard market. OMC filed for bankruptcy 22 December 2000 and laid off 7,000 employees.
The Johnson and Evinrude brands were won by bid in February 2001 by Bombardier Recreational Products and the boat division by Genmar Holdings of Minnesota. The former OMC plant #2 in Waukegan, Illinois is now a Superfund cleanup site.
History Outboard Marine Corporation sometimes referred to as Outboard Motor Company was formed in 1929 when ELTO was merged with Lockwood-Ash Motor Company. They began using the name OMC in 1956. Outboard Marine Corporation was the world's largest manufacturer and supplier of outboard motors and second largest producer of powerboats. Based in Waukegan, Illinois the company had become famous for its brand-name Johnson and Evinrude outboard motors, as well as its Chris-Craft and Grumman powerboats. Other products under the brand names of Four Winns, Seaswirl, Trade Winds, Sunbird, Stratos, and Hydra-Sports include fiberglass runabouts, cruisers, performance boats, and craft for offshore fishing. Outboard Marine also marketed clothing for boating, and resort wear. Unfortunately, during the late 1980s and early 1990s, Outboard Marine had a difficult time keeping up with the competition, notably archrival Brunswick Corporation, currently the world's largest manufacturer of powerboats.
Early years Motorized transport was just becoming an everyday part of life in 1907, when Ole Evinrude first mass-produced a practical outboard engine for boats. Evinrude placed an advertisement in a motor magazine to introduce his motor, drawing so many inquiries from U.S. and overseas readers that he decided to try large-scale production. Needing financial help with this undertaking, he found a backer and established the Evinrude Motor Company in 1910.
The business was an instant success—its market included not only recreational boaters but also the Scandinavian fishing fleets operating in the North Sea. Friction between the partners forced Evinrude to sell his share to his backer in 1914 and depart, after signing a guarantee restricting him from the outboard motor industry for five years. The company continued without him, becoming a subsidiary of the gasoline-engine manufacturer Briggs & Stratton Corporation in 1926.
By 1921, Evinrude was back in business, in a venture he called the ELTO Outboard Motor Company. His new offering was the Evinrude Light Twin Outboard, a motor partly made of aluminum, reducing its weight by a third. Popular with the fishing fleets, this engine outstripped sales of Evinrude's original outboard motor within three years. It also attracted the attention of a competitor, Johnson Motor Company, which brought out its rival lightweight engine in 1922. Johnson gained market share, snatching the lead four years later with an updated model weighing 100 pounds, costing $190, and able to drive a boat at 16 miles per hour. Neither the Evinrude Company nor ELTO could match this. Now far ahead, Johnson produced a net profit of $433,000 in 1927, far outpacing Evinrude's $25,000 and ELTO's $30,000.
A new engine in 1928 restored the ELTO Company, whose annual net profit rose to $300,000. Ole Evinrude merged ELTO with Stephen Briggs the following year when he and Harold Stratton disagreed over diversifying Briggs & Stratton into the outboard engine market. Mr. Briggs became chairman of the brand-new Outboard Motors Corporation with Mr. Evinrude as the president.
The Great Depression and World War II Outboard scarcely had time to find its feet before the stock market crash of 1929 tested its staying power. Already responsible for $500,000 in bank loans as a result of the merger, the company had to increase its debt to $600,000 between 1930 and 1932, when operating deficits totaled $550,000. To keep the business afloat, the entire inventory was sold at bargain prices, and Evinrude sacrificed his salary until his death in 1934.
Johnson's fate was worse. A too-costly advertising campaign, as well as an ill-timed offering of matched motors and hulls, drained all cash reserves by 1930, when control of the company passed to its bankers. Next came an attempt to lessen its reliance on seasonal sales by entry into the refrigerator-compressor market. This last-ditch effort did not revive the business, and shortly thereafter Johnson was for sale.
In 1935, the Outboard Motors Corporation bought the Johnson Motor Company. Its $800,000 price tag brought Outboard a line of outboards and plant and equipment worth $1.5 million. It also brought Outboard established overseas markets in China, Burma, Iran, and Albania, to broaden Evinrude's array of dealers in Europe, Australia, and New Zealand. Another plus was Johnson's niche in the refrigeration market; Outboard established the Gale Products Division at Galesburg, Illinois, to manufacture this new line.
Expansion brought changes. No longer devoted to purely marine interests, the company changed its name in 1936, to the Outboard Marine & Manufacturing Company. Stephen F. Briggs resigned his Outboard chairmanship temporarily—he had held this position since 1929 to take the Johnson helm. He instituted a rigorous cost-cutting regime, and by 1937 the Johnson division's gross sales were $4.3 million, as compared with Evinrude-ELTO's $2.5 million.
By now, Outboard Motors accounted for about 60 percent of U.S. outboard motor production. There were three engine lines, suiting most needs: the ELTO line for the buyer seeking thrift; Evinrude, the prestige line; and Johnson, offering special features. Though there was cooperation, operations were largely independent. This left each division to award contracts to outside bidders as well as those sharing a place under the Outboard umbrella. Even export sales operations were handled differently; although they were all routed through the Waukegan headquarters, Johnson tended to sell directly to its dealers, while most Evinrude sales were passed through distributors and then to the dealers.
In addition to the engines, selling mostly in seasonal markets, there were other items broadening the product lines. The Lawn-Boy lawnmower had been an Evinrude staple since 1932, along with pumps for drainage, firefighting, and lawn spraying. Offerings from Johnson included small generators, a gasoline engine for washing machines, and refrigerators. In combination with the motors, all these produced net sales of $6.8 million by 1937, generating profits of $945,000.
In the early 1940s, Outboard's facilities were all converted to the production of war materials. Bomb fuses, aircraft engines, and firefighting apparatus flowed from the Outboard factories, along with landing-boat motors for the Navy. Evinrude four-cylinder engines carried troops across the Rhine. Net sales for 1945 reached $1.8 million, topping $2.5 million the following year.
The personnel who steered the company through the hectic war years were Outboard oldtimers. In addition to Briggs, there was Joseph G. Rayniak, director of manufacturing research, whose career dated back to the Johnson brothers' 2 horsepower Light Twin, unveiled in 1922. There was Finn T. Irgens, holder of 92 patents, who had risen to be director of engineering from a start with Ole Evinrude, in 1929. There was Ralph Evinrude, who had succeeded to the company presidency after his father's death in 1934.
Expansion and growth in the postwar years These longtime staff members were all on hand with the return of peacetime, when the company converted its facilities back to the production of Johnson and Evinrude outboard motors. Spending $8 million on plant expansion and improvement by 1952, Outboard then offered models ranging from one-cylinder, 3 horsepower engines to two-cylinder, 25 horsepower models.
Several acquisitions broadened the Outboard product line during the 1950s. The first, in 1952, was RPM Manufacturing Company of Missouri, whose specialty was a rotary power mower that Outboard planned to sell under its Lawn-Boy tradename. Featuring a detachable engine useful as an outboard, the mower was already a best-selling unbranded item in both the Sears and the Spiegel catalogs. Outboard coped with the huge volume of existing orders by completing entire units in one factory, rather than using the more time-consuming method of piecemeal assembly in several locations.
In 1956, the company changed its name to Outboard Marine Corporation (OMC). The same year, OMC purchased Industrial Engineering, Canada's largest chain-saw manufacturer, for C$2.55 million plus 40,000 shares. OMC moved this new subsidiary to Peterborough, Ontario, and changed the name Industrial Engineering to Pioneer Saws Ltd.
Cushman (company) of Nebraska joined the company subsidiary list in 1957. Well known in the utility vehicle field, Cushman had manufactured the Airborne, a motor scooter dropped by parachute for ground transport of paratroopers. Later the company's lightweight vehicles became popular for agricultural, industrial, and recreational use. Costing 114,000 shares at 30¢ par, the new acquisition added three-wheel mail carriers, golf carts, and motor scooters to the OMC product line. Besides the Johnson and Evinrude motors then being sold by about 7,000 retail dealers, the swelling list of OMC offerings included Gale Buccaneer motors sold through hardware jobbers, as well as a number of unbranded models sold for retailers.
The company's most innovative engine appeared in 1958. The first mass-produced die-cast aluminum engine, it was a four-cylinder, 50 horsepower outboard, completely manufactured by OMC, its V-blocks came from Johnson, its steel parts from Evinrude, while the Gale division contributed its carburetors and ignition systems.
Export sales of all items surged ahead during the 1950s. Seeing a 215 percent gain in exports between 1949 and 1956, OMC expanded its export department in 1956, gaining a new subsidiary called Outboard Marine International S.A. By 1960, taking the next logical step of overseas production, the company was manufacturing and assembling motors in Brugge, Belgium. All these developments showed in the annual net sales, which soared from $27 million in 1950 to $171.5 million by 1959.
During the 1950s, OMC's main objective had been acquisitions to broaden basic product lines. In the 1960s, the company's aim was to improve all these products and find growing markets for them. Ensuring its industry leadership by constant innovation and improvement to existing products, OMC allocated more than $7 million annually to research and development.
As the 1960s began, the United States was in the trough of a recession. First-time buyers as well as those seeking bigger and better leisure-time equipment put their purchases on hold. Because its principal markets were tied to leisure-time activities mostly practiced on a seasonal basis, OMC sales sank to a 1961 low of $132.3 million.