Focus on machines: how Valmet became Valtra – a Nordic tale
Valmet is a name that sounds vaguely familiar to many, most know it as the precursor to Valtra, but it’s not so well known how the company went from one name to another.
The company had some sort of identity crisis in that it had an uncertain livery and it was not always clear where it came from.
Its ownership was also, apparently, quickly passed on to various companies in the latter part of the last century.
Adopted by AGCO
It was not until 2004 that it finally found some stability when AGCO bought it from Kone, the latter being a conglomerate more generally associated with the production of elevators and escalators, which remains today. hui its core business.
Thanks to this stability, the company has been able to find its place in the market, first as a supplier of tractors oriented towards the Nordic farmer, and more recently, as a manufacturer of high-end machines, which are located somewhere between the mass market Massey Ferguson range and the top of the range Fendt brand.
A different race
To understand the events that led to the company becoming the Valtra that we know today, it is helpful to look at the history of the company and how it managed to stay in business while many other manufacturers of post-war failed.
Farmers in the Nordic and Scandinavian countries tend to demand more tractors than their counterparts further south.
It is said that in Finland farmers have three separate jobs. The first manages the family farm, the second is a forester, while the third is a government contractor for snow removal work.
Tractors must be built to fulfill all of these roles, which has, to a large extent, influenced their design over the years.
A fourth function, but less mentioned, concerns military transport, in particular for winter operations where traction is essential.
It is this range of requirements that the original Valmet company had in mind when building their tractors over the years. Construction details such as the fuel tank incorporated into the transmission assembly to keep its contents warm in freezing weather were a notable quirk.
Still, building tractors was only a small facet of the Valmet conglomerate. The name itself is a short form of Valtion Metallitehtaat or “The State Metal Works” in English.
The birth of Valmet
Its origins lie in the post-war need to respond to reparations demands imposed on the country by Russia after the war.
To address these demands as quickly as possible, the Finnish government has, to all intents and purposes, nationalized Finnish industry in order to better oversee the process before focusing once again on the country’s own needs.
And so Valmet was created from the merger of private engineering companies and state-run factories, two of which were the cannon and rifle factory based near Jyvaskyla in south-central Finland. .
The need for ammunition had obviously diminished considerably after the war, so after Russia’s demands were met, these two factories began to seek peacetime roles.
Tractors were an obvious candidate as the world turned to the mechanization of agriculture and that’s how Valmet entered the fray with its 15hp Model A in 1952.
The transmission tunnel of the prototype models was formed from a gun barrel from the gun factory, such an obvious case of plowshares swords as there probably never is. had.
The Cannon Factory was not interested in manufacturing tractors, instead it turned to the wood processing industry, especially paper mills, and started producing the large rolls needed for the new factories.
Tractor production was taken over by the former Tourula gun factory where the technical skills available were better suited to a tractor manufacturer.
A young bird from the Valmet nest
Various other companies that had been amalgamated under the Valmet umbrella also returned to doing their own work, although the parent company remained a state owned and controlled company.
Pulp and paper processing has remained the largest part of the business and it is this section that still bears the Valmet name.
It now describes itself as “the world’s leading developer and supplier of process technologies, automation and services to the pulp, paper and energy industries”.
During the 1980s, large public conglomerates had a bad reputation around the world, especially in the eyes of free traders of the day.
Finland was not immune to this pressure; he began to sell different parts of the Valmet Empire to private buyers, although he often retained a stake in each company.
Volvo withdraws from tractor production
The tractor division has remained within the parent company for the time being. In the early 1980s, Volvo BM transferred its tractor interests to Valmet to focus on construction machinery, an act which significantly strengthened the Finnish company’s position in the market.
Despite a popular new range of tractors, jointly developed with Volvo BM during the transfer process, Valmet encountered serious difficulties in the early 1990s.
This has resulted in the accumulation of large stocks of tractors, 500 layoffs and the threat of closure.
It was a time of crisis and a time of change. The entire operation of the tractor, including the installation in Brazil, has been consolidated into a single entity named Valmet Tractor Inc. and management has been streamlined and brought closer to the plant.
The large stock of tractors was liquidated by selling them directly to customers in Finland. Over 300 were sold on the first day of the campaign, wiping out old inventory and pumping much-needed cash into the business.
A fruit ready to be picked
Now that the various parts of the tractor production had been removed from the overall corporate structure and placed in one pot, they were ripe for sale.
This duly happened in 1997 when it was sold to Partek, a Finnish conglomerate with interests in mining, forestry and engineering, including Hiab cranes.
The government kept 30% of the shares, so it was not quite a complete privatization.
During the various reorganizations of the early 1990s, the company moved away from its origins and it was agreed that it could only continue to use the Valmet name until 2001, when it had to change. Brand.
Such a dramatic change is a nightmare for any business and there was great concern about how to handle it. The first and most important problem is choosing a name that does not alienate the clientele.
An obvious answer
In this case, the solution was not difficult to find.
In the 1960s and 1970s, the company worked with aftermarket suppliers to supply a full line of approved accessories for Valmet tractors.
Any equipment that had been tested and approved by Valmet for use on its machines could be sold under a common brand. That name turned out to be Valtra, and it was seen on items such as front loaders and backhoes.
The system had fallen into disuse, but Valmet still had the nickname and even used it on articulated tractors from 1996.
So it was a simple task to resurrect it and apply it to tractors where it provided some continuity and connection with the Valmet brand.
This is how Valmet finally morphed into Valtra in 2001 and the following year the company was sold in its entirety to Kone. Three years later, AGCO acquired 100% of the business and has remained with them ever since.