The Sad Collapse and Sale of Westinghouse
Can you shed a tear for a corporation that messes up? I can.
It was known, after its logo, as “The Flying Bar W.” It was the emblematic “can do” company: creative and confident in its engineering, sagacious in its marketing, aggressive politically and not afraid of a scrap.
It was Westinghouse, and it traced its linage to George Westinghouse, the man who invented the air brake that, with modifications, still stops railway trains and big trucks. He also warred with Thomas Edison and proved to be right in backing Nicola Tesla’s alternating current over Edison’s direct current.
Now, after an ignominious bankruptcy, the company has been sold by its last owner, Toshiba, to a Canadian asset management firm, Brookfield Business Partners.
Westinghouse has had its ups and downs. I was lucky enough to know its executives and to cover the company when it was on a winning streak under the chairmanship of Robert Kirby.
Westinghouse was a sluggish but still prosperous operation when Kirby took over in 1975. He sold off unprofitable divisions and concentrated on its core power generation business, especially nuclear. “I have had to sell businesses that would have made an individual rich,” Kirby told me.
The world nuclear industry owes much to Westinghouse and technology, which came out its former Monroeville, Pa., headquarters near Pittsburgh. It was a technology driver. Nearly every light water reactor design was influenced by Westinghouse. The envied French nuclear electric system relies partly on Westinghouse designs.
Poor management — including an excursion into television — hurt the power business, as did the long hiatus in domestic plant ordering.
The proximate cause of the economic collapse of Westinghouse are two ambitious reactor projects: V.C. Summer and Vogtle nuclear plants in South Carolina and Georgia. There were multiple mistakes suggesting a lack of managerial depth, both at Westinghouse and Toshiba, which bought the battered Westinghouse power business from BNFL for $5.4 billion in 2006, and probably overpaid.
Then there was a new reactor design that was yet to be deployed in the United States (Westinghouse 1000) and the deteriorated nuclear supply chain — no reactor had been built here in 20 years. But, sources tell me, the critical mistake was fixed-price contracting. This had been a no-no from the early days of nuclear power: too much can go wrong and often has. It did again.
Maybe its new owners will let Westinghouse lead again.
The Joy of Reading Detective Fiction
I feel a bit sorry for people who don’t read fiction or who don’t think they have time for it.
I’ve been checking informally on the reading habits of my friends and I learn that most of them are on the news-and-fact treadmill night and day. Get off, I say.
The easiest way to escape dull care is to tuck up with a good detective book and live in your head with its characters. These have beginnings and ends: In the hands of masters — say P.D. James, Donna Leon or the late Colin Dexter — you get complex characters, human situations and the whole project moves along at the pace of the investigation. There aren’t that many awkward endings that bedevil many books.
I exclude those detective novels with superhuman heroes, tough guys. Unreal. A common thread in detective fiction is the struggle of the individual against the system. Maybe that’s everybody’s struggle, the human condition. The system is at odds with all of us. Maybe that’s why we enjoy detective fiction.
And the Answer Is … Money?
One wishes Alex Trebek, the host of “Jeopardy!” who is taking a medical leave after undergoing surgery to remove blood clots from his brain, a quick recovery.
He has been seeking answers at the syndicated game show since 1984. One does wonder how he has survived doing the same thing with the same equanimity for so long? I guess, as Noel Coward said to an interviewer when asked why the critics hated his last play, “Sail Away”, which nonetheless was sold out in London, “I suppose I shall have console myself once again with the bitter palliative of commercial success.”
Trebek makes $10 million a year. Maybe that’s it.
The Things They Say
“It is very important in life to know when to shut up. You should not be afraid of silence.” — Alex Trebek
Gil Brown says
I get the point of fixed cost being problematic and a lesson to have been learned. But, unlike the plants of the “naissance,” which were hardly replicated, I thought the FOAK (first of a kind) risks of the AP-1000 would have been ameliorated by the back log of plant orders. Seem to recall a couple of dozen or so. Thus, the demise probably had as much, if not more, to do with the crippling effect of fracked gas (and mandated/subsidized wind and solar).