Briggs & Stratton - Acquisitions, Agreements and Joint Ventures

Acquisitions, Agreements and Joint Ventures

• Farymann Diesel GmbH (1979–1984) – Based in Lampertheim (near Mannheim) in Germany, this was the first foreign acquisition Briggs & Stratton had ever made and was a poor fit with the company's acknowledged expertise in high volume, low cost production. Despite investing in new production methods, Briggs & Stratton never understood the very low volume, highly customized nature of the air-cooled diesel engine market. After considering adding Italy's Lombardini to increase its presence in the diesel market, as well as a failed attempt to develop its own designs, Briggs & Stratton accepted defeat and sold the company to a private investor for a minimal amount to avoid further liabilities. Since the energy crisis had not affected the US market's preference for gasoline engines, enthusiasm waned rapidly at management level for diesel engines. They officially completed the acquisition on May 29, 1979.

• Daihatsu Briggs & Stratton (DBS) – In an effort to stave off Japanese competition during the 1980s, Briggs & Stratton entered a 50/50 joint venture with the Daihatsu Motor Company in Japan. Located in Shiga Prefecture (50 miles (80 km) from Osaka, Japan), construction on the then-57,000-square-foot (5,300 m2) plant began in December 1986 and was completed in April 1987. This joint venture was notable for the manufacture of vertical and horizontal crankshaft engines from 12.5 to 22 hp (16 kW) under the Vanguard brand. Today the plant employs roughly 100 people on two shifts and manufactures Vanguard V-twin engines ranging from 14 to 36 hp (27 kW).

• The Mitsubishi Agreement – The Vanguard line initially consisted of three single-cylinder engines and several V-twin engines. The V-twins, made by DBS, had sold very well but the single-cylinder engine models, originally produced at Briggs & Stratton's Menomonee Falls, Wisconsin plant, didn't fare so well. Briggs & Stratton needed to solve this problem, so, following discussions with several Japanese engine manufacturers, it entered into an agreement with Mitsubishi Heavy Industries Ltd. of Tokyo, Japan. Briggs & Stratton produced only certain parts for the engines, while Mitsubishi was responsible for overall production and shipping. The completed single-cylinder Vanguard engines were shipped directly to customers worldwide. Briggs & Stratton had exclusive marketing rights only in North America, Europe and Australia/New Zealand. MHI had exclusive marketing rights (under their own brand name) in Malaysia, Taiwan, South Korea and Japan. In other countries both companies competed with the same product under their own brand names which led to considerable friction, and together with escalating production costs in Japan, caused this otherwise successful relationship to fail. Briggs & Stratton commenced marketing alternative U.S.-made single-cylinder engines under the Vanguard brand in early 2007.

• The Komatsu Zenoah Venture – In May 1987, Briggs & Stratton entered into an agreement with yet another Japanese company, executing a 10-year contract with the Komatsu Zenoah Company of Tachikawa, Japan. Under the terms of the contract, Komatsu would manufacture a 2-cycle, 4 hp (3 kW) engine, in which Briggs & Stratton would purchase and distribute in the United States, Europe, Australia and New Zealand. Said Fred Stratton, "This venture was not successful, because the rising price of the yen made the engine too expensive in the U.S."