ILO-Motorenwerke
The founder Heinrich Christiansen bought a bankrupt machine factory, with 25 employees producing a track tamper-compactor for Prussian railway construction.
Heinrich Christiansen's son, who took over from his father, negotiated the sale of the business to Rockwell Manufacturing Company that same year.
In 1960, before Rockwell could redirect their efforts, small motor demand exploded with their entry in the fast-growing North American snowmobile business.
Prior to Rockwell, Hodges was a physicist with NASA, and an aerospace reliability and quality manager with Martin-Marietta in Orlando, Fl.
Each facility's quality was graded by the level and trend of its quality cost impact on earnings, revealing significant quality and reliability issues especially with Gas Product Division meter leaks – and, of large escalating warranty claims on US books and enterprise image issues regarding snowmobile motor sales into rapidly growing US and Canadian snowmobile markets, with motors manufactured by the Engine Division's ILO-Motorenwerke factory in Pinneberg, Germany – which repeatedly did not correct.
Escalating losses and accelerating debt was accumulating in the motor business on both sides of the ocean, as well as the Dikkers Valve Netherland firm also going into the red.
In 1970, Rockwell Manufacturing Company management appointed Michael W. Hodges as CEO of the unprofitable Engine Division and as ‘Geschäftsführer’ (managing director) of the German-based ILO-Motorenwerke GMBH manufacturing company, including appointed to the European boards of Rockwell GMBH Germany and Dikkers Valve Products LLC Netherlands.
Many failed delivered motors were being rotated into a rework facility set up in Russellville, Kentucky, as warranty costs soared.
After Mr. Hodges' arrived at the Engine Division's ILO-Motorenwerke factory in Pinneberg, Germany a first priority was to recognize that thousands of dedicated long-serving German employees had jobs at risk and large time-consuming termination costs.
Attacking quality issues internally and with major suppliers, and reducing snowmobile production, including significant downsizing of the labor force via the personnel manager gaining local in-plant union leader to assist setting up a jobs fair such that every departing worker found a new job without pay loss, with minimal termination cost – such cancelled a threatened central union lawsuit.
A large nearby rented warehouse had been stuffed full with unusable motors and parts, at inflated book prices.
