Fagor

Fagor Electrodomésticos was a large domestic and commercial appliance manufacturer based in the Basque Country, Spain and run by the Mondragon Corporation. Fagor was Spain's largest consumer appliance company and the fifth largest electrical appliance company in Europe, manufacturing a wide range of domestic appliances, including washing machines, refrigerators and ovens.[2]

Fagor Electrodomésticos, S. Coop
Sociedad Cooperativa
Founded1956
DefunctNovember 2013 (2013-11)[1]
Headquarters
Mondragón
,
Spain
Number of employees
6,000 (2006)
ParentMondragón Corporation
Websitewww.fagor.com

History

Fagor Electrodomésticos was the world's biggest industrial worker cooperative for decades,[3] the flagship of the Mondragon Corporation, the world's largest workers' co-operative.

It started in 1956 in a small workshop in Mondragón, Spain. From the Spanish market, it expanded internationally to North Africa and Latin America in the late 1980s. From 1996 to 2001, Fagor formed joint ventures with international companies. In 1999, Fagor acquired Wrozamet in Poland. The acquisition of Brandt Electroménager in 2005 made it the leader in household appliances in France. Among European manufacturers, it ranked fifth after Electrolux, Whirlpool, Bosch Siemens and Merloni. The employees of the foreign acquisitions were not offered ownership. Besides, about 15% of the workers in the parent company were temporary employees without ownership rights. In 2006, it had eight production plants in Spain, four in France, one in Poland, one in Italy, three in China and one in Morocco). Its 1,729-million-euro sales were 6% of the European market. The total workforce was 10,543 employees. The buying of Brandt and other growth was financed through borrowing as capital markets were not available. When the Spanish housing crisis struck in 2008, the main market for Fagor appliances collapsed. Increased Asian competition could not be countered in spite of austerity measures, liquidity injections and staff relocation.[3]

On October 16, 2013, Fagor Electrodomésticos filed for protection from creditors while it tried to refinance and renegotiate its €1.1 billion of debt under Spanish law, after suffering heavy losses during the European financial crisis.[4][5]

On November 6, 2013, Fagor Brandt, the French subsidiary of the Spanish appliance manufacturing group, which employed 1,920 people, announced its bankruptcy and was placed under receivership in early 2014, before being divested and taken over by the Algerian conglomerate Cevital Group.[6][7]

Later Fagor Electrodomésticos officially announced its bankruptcy as well and has been taken over by Spanish appliance manufacturer CATA Electrodomésticos (CNA Group) in autumn 2014, adding 155 new jobs.[8][9]

In late 2014, the German appliance company BSH Hausgeräte was about to purchase FagorMastercook in Poland.[10]

One of the factors in the fall of Fagor has been the human resources policy. Relatives of workers were given preference. The new workers did not acquire the cooperative mindset and were submitted to Taylorist methods. The disengagement led to absenteeism beyond the usual in Spanish private companies, and unusually higher among the younger workers. This was paradoxical for a worker-owned company. A reverse dominance hierarchy formed and decisions like offshoring production to the cheaper wage workers were not taken by worker-owners.[3]

Structure and global business

Mondragon Corporation comprises, 122 industrial companies, 6 financial organizations, 14 retailers, 4 research centers, 1 university, 14 insurance companies, and international trade services. It has a assets of 24.72b Euro (2014), a revenue of 12.1b Euro (2015), and a workforce of 69,000.

The corporation is divided into three main divisions: finance, retail, and industrial.

Major international expansion has increased Fagor's workforce to 6,074. It has factories in Europe, America, and Africa. It also has 13 worldwide subsidiaries and sales networks in 80 countries in 5 continents. The purchase of the Brandt Group in 2005 made Fagor one of the largest appliance manufacturers in Europe. This also included the brand names, Ocean, SanGiorgio, and De Dietrich.

Fagor America makes major appliances, small appliances, and cookware.

44% of Fagor's sales are international, 70% percent of which are in France, Portugal, Germany, the UK, Morocco, Poland, and the Czech Republic.

Fagor markets its products under the following brand names:

  • Fagor
  • Edesa
  • Aspes
  • Mastercook
  • De Dietrich
  • Fagor Commercial
  • Brandt
  • Ocean (acquired with Brandt acquisition)
  • SanGiorgio (acquired with Brandt acquisition)
  • De Dietrich (acquired with Brandt acquisition)

References
  1. "Spanish appliance group Fagor files for bankruptcy". Reuters. November 13, 2013. Retrieved March 14, 2014.
  2. About, UK: Fagor.
  3. Basterretxea, Imanol; Heras-Saizarbitoria, Iñaki; Lertxundi, Aitziber (February 20, 2019). "Can employee ownership and human resource management policies clash in worker cooperatives? Lessons from a defunct cooperative" (PDF). Human Resource Management (58). doi:10.1002/hrm.21957. Retrieved September 13, 2019.
  4. https://www.reuters.com/article/2013/10/16/spain-fagor-idUSL6N0I61WA20131016
  5. https://www.theguardian.com/social-enterprise-network/2013/nov/15/spanish-co-op-workers-occupy-plant
  6. http://www.euromonitor.com/consumer-appliances-in-france/report
  7. http://www.liberation.fr/economie/2013/11/06/fagorbrandt-journee-cruciale-pour-les-salaries-avec-la-reunion-du-cce_944945
  8. "Catalan company Cata buys bankrupt domestic appliance business Fagor ", published 29 July 2014.
  9. "CNA Group announces the acquisition of the production units of Fagor" Archived April 13, 2015, at the Wayback Machine, published 5th of November 2014.
  10. "Bosch-Siemens to buy FagorMastercook's Wrocław business" Archived April 10, 2015, at the Wayback Machine, Published on 2014-12-29.
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