Fagor parent organization Mondragon Corporation
Fagor Electrodoméstico was a large domestic and commercial appliance manufacturer based in the Basque Country, Spain and run by the Mondragon Corporation. Fagor was Spain's largest consumer appliance company and the fifth largest electrical appliance company in Europe, manufacturing a wide range of domestic appliances, including washing machines, refrigerators and ovens.History
Fagor Electrodoméstico was the world's biggest industrial worker cooperative for decades, the flagship of the Mondragon Corporation, the world's largest workers' co-operative.
It started in 1956 in a small workshop in Mondragón, Spain. From the Spanish market, it expanded internationally to North Africa and Latin America in the late 1980s. From 1996 to 2001, Fagor formed joint ventures with international companies. In 1999, Fagor acquired Wrozamet in Poland. The acquisition of Brandt Electroménager in 2005 made it the leader in household appliances in France. Among European manufacturers, it ranked fifth after Electrolux, Whirlpool, Bosch Siemens and Merloni. The employees of the foreign acquisitions were not offered ownership. Besides, about 15% of the workers in the parent company were temporary employees without ownership rights. In 2006, it had eight production plants in Spain, four in France, one in Poland, one in Italy, three in China and one in Morocco). Its 1,729-million-euro sales were 6% of the European market. The total workforce was 10,543 employees. The buying of Brandt and other growth was financed through borrowing as capital markets were not available. When the Spanish housing crisis struck in 2008, the main market for Fagor appliances collapsed. Increased Asian competition could not be countered in spite of austerity measures, liquidity injections and staff relocation.On October 16, 2013, Fagor Electrodoméstico filed for protection from creditors while it tried to refinance and renegotiate its €1.1 billion of debt under Spanish law, after suffering heavy losses during the European financial crisis.On November 6, 2013, Fagor Brandt, the French subsidiary of the Spanish appliance manufacturing group, which employed 1,920 people, announced its bankruptcy and was placed under receivership in early 2014, before being divested and taken over by the Algerian conglomerate Cevital Group.Later Fagor Electrodoméstico officially announced its bankruptcy as well and has been taken over by Spanish appliance manufacturer CATA Electrodoméstico (CNA Group) in autumn 2014, adding 155 new jobs.In late 2014, the German appliance company BSH Hausgeräte was about to purchase FagorMastercook in Poland.One of the factors in the fall of Fagor has been the human resources policy. Relatives of workers were given preference. The new workers did not acquire the cooperative mindset and were submitted to Taylorist methods. The disengagement led to absenteeism beyond the usual in Spanish private companies, and unusually higher among the younger workers. This was paradoxical for a worker-owned company. A reverse dominance hierarchy formed and decisions like offshoring production to the cheaper wage workers were not taken by worker-owners.
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