Barber Greene 1916 - 1985

Harry H. Barber and W.B. Greene founded Barber Greene in 1916 in Aurora to design and produce conveyors and bucket loaders to raise the productivity of coal yards. The first twenty years were extremely difficult with many stories of missed or deferred payrolls. Fortunately for the firm’s eventual growth and success, the employees were both highly loyal and talented.

Barber Greene’s most significant growth resulted from the invention of the asphalt plant and paving machine during the late 1930’s. World War II created a heavy demand on these new products, primarily for building asphalt landing strips worldwide. This created a strong period of growth from the late 1940’s until the mid 1960’s. The need for capital forced the company to go public in 1959.

A purchase for stock in the early 1960’s of Telsmith, a Milwaukee company which manufactured crushing, screening and aggregate producing equipment led to strong market leadership in both aggregate and asphalt equipment. By the mid-1960’s, Barber-Greene was established with plants in Aurora and DeKalb, Illinois and with Telsmith plants in Milwaukee.

Foreign manufacturing was in England, Holland, Canada, Australia and Brazil. Licensees for aggregate equipment operated in England, France, South Africa, and South America. An independent distributor network in every state and province in the U.S. and Canada, as well as in every country world-wide where highways existed supported equipment sales and customer service. Sales exceeded $100,000,000 and employment was in excess of 3,000, with 1,000 in Aurora.

The aggregate industry is dependent on highways and also other building that relies on concrete as a key element. The asphalt industry was much more dependent on the highway industry than the aggregate business. More specifically, new private development for local roads, parking lots and other transport infrastructure determined demand for Barber Greene asphalt equipment lines.

The primary source of funding for asphalt highway construction was gas tax or user tax on gasoline sold in developed countries that were dedicated for highway maintenance and construction. Asphalt as a binder of aggregates or crushed stone is the heavy end of the oil barrel or what remains after lighter distillates such as gasoline, aviation fuel and heating oil are distilled in the refining process.

Asphalt concrete had large advantages over Portland cement concrete for road building. It could be laid over an aggregate base after compaction and be utilized by the next day. Portland cement concrete needed higher site preparation and many days of curing before usage. Asphalt concrete also was the primary road maintenance material when one to six inches of overlay to a disintegrating roadway was required to create a smooth pavement.

Asphalt contractors were local family-oriented businesses in the U.S., Canada, and Europe. Because the paving material was manufactured and delivered to a work site heated above 300 degrees, there were limitations to distance between the plant and the roadbed. To overcome this, the industry was dominated by single contractors in each town or village that tended to have a monopoly over most paving work in their area.

Capital investment in equipment and land exceeded $2,000,000, creating a significant barrier of entry and lack of real competition in many areas. But it also created many wealthy family-owned operations. Demand for funding for high growth and maintenance, commercial created expansion of operations and residential development, low interest rates and equipment made obsolete by new technology or age.

The industry was seasonal with the construction season being limited to March through October in much of the developed northern countries of America and Europe. To prepare for demand, equipment manufacturers, such as Barber-Greene, needed to build large inventories in the off-season. This required heavy seasonal debt in order to be prepared for the equipment demand in the spring and summer. Delivery capability was key to market share.

The first abrupt disruption to the asphalt market occurred in 1973 with the oil embargo and tripling of oil prices. Oil based raw materials also tripled, and in many cases they were not available. Highway revenues from gas taxes did not increase as higher gasoline prices and shortages curtailed driving. The result was an immediate decrease in paving activity domestically, by more than 50%, and an enormous drop in demand for new equipment. Large layoffs and corporate losses wreaked havoc with the balance sheets of many in the industry, as contractors waited out or tried to adapt to the crisis of higher material costs and lower road building revenues.

Barber Greene’s reaction to this period from 1974-1978 was to retrench, diversify and develop. One consolation of the oil price increase was to change the economies of road construction. The ability to recycle old roads into new asphalt concrete by using equipment to remove the old paving materials, transport them to the plant and then reheat and rebalance the gradation resulted in a new technology required by the market. Asphalt plants adapted to this technology and mobile equipment to recycle created new demand for equipment, but the costs of development were high.

By 1979, profitability was returned and markets were healthy, in part due to large new road building projects in the newly rich Middle East oil states, which had precipitated the initial crisis with oil price tripling in 1973. However, recovery was cut short as Iran’s Shah was overthrown and oil prices tripled again. This was accompanied by high inflation and interest rates exceeding 18%. The resulting road building collapse was worldwide, not confined to the U.S. as after 1973 oil price rises. Again, layoffs and huge losses occurred. Barber Greene and others in the industry piled up huge debts and no turn-around was in sight.

Attempts were made to use the facilities and skills for other work. Barber Greene was awarded an order for $17,000,000 worth of tunneling machines for the Shah of Iran. This shipment was underway when the Shah fell. The result was no payment and expensive litigation. Three years of painful bank and lender negotiations followed, coupled with drastic cutbacks and layoffs.

These ongoing crises finally culminated in the forced sale of Barber Greene to Astec Industries in Chattanooga, Tennessee. Mobile equipment was moved to DeKalb in 1986 and the Aurora operations were closed. The DeKalb operation was sold to Caterpillar in the late 1980’s and moved to Minnesota by Caterpillar in the early 2000’s, where it continues today. The Telsmith operation in Milwaukee remains a part of Astec.

Much of this Barber Greene history from the glory years in the 1960’s was lived through and recalled here by Dave Hipp. As a third generation descendent of founder Ashley Barber, Dave remained a Director until Barber Greene was sold to Astec in 1985.

As for all those asphalt machines that built the roads of the world, they are still being produced, although their once glistening green Barber Greene finish is now a Cat canary yellow. For those of us old enough and sufficiently nostalgic, seeing one of those original green classics along the world’s roads anywhere from Afghanistan to Zambia sparks a stream of fond memories of Aurora at it’s manufacturing peak.

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Sources:

Dave Hipp, Aurora Beacon News, Barber Greene Company History