The 1970s was a time of tremendous social change, such as increased political awareness and an emphasis on women’s rights. Women were making their way out of the home and into the workplace. In fact, in a landmark decision, Pampa, Texas plant manager, John Fritsch, chose to allow women to wear slacks to work (instead of dresses or skirts) with the stipulation they wear coordinated pantsuits. This decision was convenient, since polyester suits were the fashion of the day.
Further diversifying the product line portfolio from their original joint venture in 1962, Hoechst-Celanese partnered with Herbert’s Industrieglas to develop a safer sight glass by fusing metal with glass. Due to the enormity of the cost involved, Herbert’s also included Bayer AG and BASF to assist with funding, testing and technical aspects of the project. The three companies were instrumental in developing what is known today as Metaglas®, the safest sight glass in the world, used in a wide range of applications from distribution transformers, magnetic anti-theft tags, motors and high-frequency inductors. Herbert’s eventually sold their paint division to Celanese, and Celanese later sold it to DuPont in 2000.
Lower labor costs and minimal fringe benefits continued to make the U.S. market attractive to Hoechst AG, and they further increased their American influence by acquiring Hystron Fibers Incorporated in South Carolina. Despite losses in the fibers market, Hoechst executives took comfort in the knowledge that their diverse product line would shield them from long-term harm. Hoping to increase global market share, Hoechst focused its efforts on the world’s largest nation of consumers, the U.S.
Though Celanese had remained heavily dependent on the acetate and polyester markets in the 1960s, diversifying into building materials, health care and hospital supplies, revived the company, which was met with great success until the Arab Oil Embargo began in 1973, causing price increases and shortages in raw materials. The oil embargo was a result of the U.S. decision to re-supply the Israeli military during the Arab-Israeli War, in order to gain leverage in post-war peace negotiations.
Also on the world stage, the Vietnam War raged on, and opposition to the war bitterly divided Americans, even after President Richard Nixon ordered the withdrawal of U.S. troops in 1973. The U.S. Supreme Court issued a landmark decision on the Roe v. Wade case, and in 1974, President Richard Nixon resigned as a result of the Watergate Scandal. He was the first president to resign in U.S. history.
Celanese experienced rising fuel prices as a result of the oil embargo and made the decision to explore alternative fuel sources. In May 1976, a proposal was submitted to replace existing gas-fired boilers with coal-fired equipment, and Brown and Root Construction, along with several hundred Celanese employees settled in Pampa, Texas for the duration of the project.
Due to significant growth in the demand for high-performance polymers and fibers, Celanese made the decision in the late 1970s to build a new PBI (polybenzimidazole) production facility at the Celriver site in Rock Hill, South Carolina. PBI is a synthetic fiber with a very high melting point and exceptional thermal and chemical stability. The Celriver site was also the sole training facility for Celanese emergency workers and firefighters.
In addition, Celanese entered into a technical and sales collaboration with a Japanese company, Toho Rayon, in 1976, in order to work on carbon fiber production from rayon. But despite all its efforts at diversification, the company registered the lowest return on stockholders’ equity among the 13 diversified companies in Forbes’ yardstick.
Despite the downturn, in 1978 Celanese adopted a proactive approach to protecting the environment in an effort to promote safety and environmental issues in the industry. In an effort to eliminate as much wastewater as possible, plans to construct a 1.5 million gallon vessel, designed to organically treat wastewater, were implemented.
Around the same time, Celanese announced its proposed stock-swap merger with Olin Corporation, which would make Celanese-Olin the sixth largest chemical producer in the U.S., with 1977 chemical sales totaling $2.9 billion out of total sales of $3.8 billion. Negotiations were terminated, however, with little or no explanation.
Despite fears that a takeover was imminent, Celanese had its three most profitable years in history between 1979 and 1981, earning a record $144 million on sales of nearly $3.8 billion in 1981.
Hoechst took over the polyester film business of Celanese in Greer, South Carolina and became one of the area’s largest employers. The German company with its German and American staff soon became an international curiosity.
The decade came to an end with an air of unrest and looming disaster. On March 28, 1979, the core of one of Three Mile Island’s nuclear reactors in Pennsylvania, USA partially melted down, resulting in the worst nuclear disaster in U.S. history. Then on July 3, 1979, the Ixtoc I oil well in the Bay of Campeche exploded, spilling 138 million gallons of oil into the Gulf of Mexico over an astounding 293 days. Finally, on November 4, 1979, a group of Iranian students stormed the U.S. Embassy in Tehran, taking more than 60 American hostages, as a result of President Jimmy Carter’s decision to allow Iran’s deposed Shah to enter the U.S. for cancer treatment. Historians surmise that the hostage crisis cost President Carter his second election. The Iranian students set their hostages free on January 21, 1981 just hours after the inauguration of President Ronald Reagan.
Thank you for following the 100 Year Anniversary blog. We hope you learned something interesting about the sixth decade of Celanese’s history. Be sure to follow along on our interactive digital timeline and on social media.
This site uses Akismet to reduce spam. Learn how your comment data is processed.