Janesville56.5°

Parts supplier motors in

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JAMES P. LEUTE
February 10, 2009
— Rock County has lost vehicle manufacturing, but it now has an engine business.

Janesville businessman Jim Grafft on Monday bought the assets of the engine division of TecumsehPower Co. and plans to move the operation to Rock County.


Until TecumsehPower ended engine production in December, the company made gas engines for snowblowers, generators and other lawn and garden, industrial and agricultural applications.


Initially, Grafft will supply parts for TecumsehPower engines. Down the road, Grafft said his company could produce engines locally, a step that would rev up the potential for new, well-paying jobs.


TecumsehPower, a direct competitor of Briggs & Stratton in the small engine market, lost a key customer last year.


"At one point, they were building 2 million to 4 million engines a year," Grafft said. "Then 60 percent of their business disappeared.


"That created a huge void in the market," he said, adding that TecumsehPower supplied about 80 percent of engines for snowblowers.


Last week, TecumsehPower sold the assets of its transmission business to Husqvarna Outdoor Products.


TecumsehPower engines primarily were built in Dunlap, Tenn. Component plants in Indiana and the Czech Republic supported the Tennessee plant.


At this point, Grafft's purchase of TecumsehPower is similar to a move he made in 1982. Grafft and his Janesville-based Certified Parts Corp., a national parts distributor for recreational equipment, bought Arctic Cat, essentially cornering the market on parts for the snowmobile line.


Grafft said his first challenge will be to consolidate in Rock County the TecumsehPower parts. He owns the former highway trailer building in Edgerton, as well as buildings in Janesville on Jackson, Pearl and Racine streets.


Many of the first shipments of parts will go to the Racine Street building.


If he ever moves to engine production, Grafft said he'd need about 200,000 square feet of space, which is the size of his Edgerton facility.


In order to build engines, Grafft said he would need to study the market and determine the players and their relationships with engine companies.


"A lot of those relationships go back years, but there are certainly some smaller original equipment manufacturers—even bigger ones—that don't have relationships with engine companies," he said.


Grafft would not reveal the purchase price for the assets, which a Los Angeles-based private equity firm bought in 2007 along with the transmission business for $51 million.


TecumsehPower engines date to 1895, when John Lauson built his first internal combustion engine in New Holstein to make life easier for Wisconsin farmers. In 1905, Lauson introduced an engine designed for cold Midwest winters. Dubbed the "Frost King," the engine circulated a solution of calcium chloride that helped it start and keep running.



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