Hampton Machine Tool – Case Write Up

Hampton Machine Tool – Case Write up

Hampton Machine Tool Company was founded in 1915. Their customers were mainly Defense and Automobile manufacturers. Fortunately they were reported to be able to withstand the severe cyclical fluctuations characteristic of the machine tool manufacturing business. The case explained that it’s conservative financial policies contributed to its success and survival in the industry. Hampton’s customers consisted of military aircraft and automobile manufacturers in the St. Louis area. They were associated with the Vietnamese War and the booming automobile market in the in the mid-60s through the early 70s. Fortunately, The company didn`t have a debt during 10 years until December 1978.

Unfortunately The company slowed down in the 1970`s economic recession caused by the Arab oil embargo (associated with the automobile industry, a major consumer), the recession caused by the Vietnam War ( military aircraft, another major consumer) and the subsequent increase in the price of gasoline . Hampton, fortunately, stabilized by the late 1970`s