Eaton Corporation

            Eaton Corporation, ETN, is a worldwide manufacturer of highly engineered products for many different markets.  Unlike some competitors in this industry, Eaton serves a number of different markets besides the automotive market.  The Commercial/Institutional facilities, Military/Defense, and Heavy Equipment markets are a few examples of this (eaton.com).  By diversifying into different areas they are able to create more long run stability through not being solely dependent on the success of one major market.  Therefore, fluctuations in demand in one area will not have a great affect on the company overall.

            ETN is an international presence in the automobile parts and accessories industry.  They have a manufacturing presence in many countries around the world.  Most countries in North America, South America, Europe, Asia, and Australia are affected by Eaton (eaton.com).  This shows how wide spread their operations are around the world.  Although Eaton’s presence can be found on nearly every continent around the world, their corporate headquarters is based out of Cleveland, OH.  From the USA to Australia to Japan, Eaton has searched the globe for the most attractive and fitting areas for their operations.  In turn, creating a competitive advantage over some competition that have not been as open to globalization.

            Eaton produces many different types of products for many different markets around the world.  Hydraulic and fluid connectors, electric power distribution and control equipment, fluid power, spun out axels, truck drivetrain systems, and engine components are some applications that Eaton produces within the auto division (eaton.com).  The auto and truck segments are more sensitive to the economic changes, and will fluctuate in yielding results over periods of time.  The fluid power segment is not like this however.  This segment should give more consistent and constant results over the long run, and Eaton’s expansion into this area will pay great dividends (Value Line, 2004).  This looks to be a promising fact for the company.

            According to Value Line Publishing, Eaton should have fond memories of recent years.  The corporation was able to increase their presence in the fluid power sector of the market.  This is a very good thing for Eaton because of the heavy competition that is present I this sector.  This shows that they are able to increase their competitiveness even when the room for improvement is slim.  They were able to gain this increase mainly from the use of acquisitions and joint ventures, and as a result they were able to increase their sales in this area by 11%.  Although the revenue from this was not as great as hoped because of the tough business conditions, this will put Eaton in a position to do well in the foreseen general turnaround in the economy (Value Line, 2004).  Making improvements such as this with the tough conditions is a sign that Eaton is looking for much brighter things ahead.