Red Dot Corporation is focused on bringing comfort to people whose office happens to be a vehicle. The company been leading the mobile HVAC industry for 55 years.
In the Gulf War, the U.S. military sent in four-wheel-drive tactical Humvees with canvas tops and sides for combat, ready to perform with minimal maintenance on challenging terrain over long periods of time. The lightweight vehicles were designed to carry cargo and occupants in safety. What they weren’t expecting were the IEDs – improvised explosive devices – that tragically took many lives.
The military needed to up-armor their transport vehicles for the invasion of Iraq in 2003. That’s when Red Dot Corporation, a Seattle, Washington-based manufacturer of mobile heating, ventilation and air-conditioning (HVAC) systems and replacement parts for heavy-duty vehicles, was called in.
“As soon as you enclosed those soldiers in those armored vehicles it became a pizza oven, especially in the Middle East. So they needed air-conditioning and they needed it really, really fast,” explains Pat Carroll, Vice President of Sales for Red Dot.
“In the span of roughly 60 to 90 days, we went from concept to validating the testing of the AC system and started producing AC systems that were dropped into Kuwait to be outfitted by the military. At that time our commercial business was sailing along at a pretty good clip so we couldn’t just drop that into our regular production, so our leadership team got creative and hired a weekend shift to build nothing but military product.”
The AC made such a big difference that the military started adopting it in their vehicles as an aftermarket addition and to spec it into vehicles at the factory. To date, Red Dot has fielded north of 80,000 systems.
The 55-year-old company has a solid reputation for innovation, quality and on-time delivery to hundreds of aftermarket distributors and original equipment manufacturers around the globe, in the construction, agriculture, mining, defense and trucking sectors. Through distributors located from Mexico to New Zealand, the company offers the industry’s most comprehensive catalog of all-makes parts, accessories and unit kits. For both OE and aftermarket, the team can take a project from custom design to delivery with an in-house technical center that stacks up to the best in the business, Carroll says.
He’s seen a lot of growth and the development of a diverse range of products during his 26 years at Red Dot. Those products include industry firsts like separate climate controls for the sleeper compartment of heavy trucks, the trinary pressure switch, air-operated water valves and vent doors, and low-profile rooftop condensers.
“We’ve got customers – whether it’s Caterpillar, Daimler, or others – that will partner with us to do their air-conditioning testing or gather their field service data. Just because they know when it goes to the Red Dot technical center it will be done right,” he shares.
People are a top priority at Red Dot and the company really means it – the business is actually 100 percent employee-owned, which gives it a unique and enterprising culture. The products are focused on bringing comfort to people in demanding job environments and the founder’s number one concern was always the welfare of his employees, so much so that in the early 1970s, Red Dot moved to a four-day work week so employees would have Fridays for personal business in the days before weekend banking and shopping.
“Everyone from top to bottom has a little skin in the game,” Carroll says. “If they think like an owner and act like an owner, they are going to do a better job for the customers. We are going to have people who really care on a day-to-day basis. And it should really help the employee as well; they should benefit from their hard work and not have to rely on the wolves of Wall Street, so to speak.”
In fact, Harcourt G. “Harky” Runnings, the founder and former chairman of Red Dot, brought a family spirit to the workplace long before it was fashionable. He was a veteran of Boeing, among other companies, who started a Seattle radiator repair shop. He had a friend who drove a truck to Alaska and always talked about how cold it got in the cab and how he would have to get out and chip ice off the windshield. So on a weekend, Runnings put a little heater together that could be put underneath the seat or on the dashboard – and it’s still in production today. He founded Red Dot in 1965 when the popularity of his heaters outpaced his ability to produce them.
As for the name, Red Dot, well… “There’s no real significance behind the name,” says Carroll. “He just wanted a really short and memorable name that would fit very well in the ‘pay to the order of’ part of a check. He wanted to call it Dot but he thought people would confuse it with the Department of Transportation.”
When he retired in 2000, Runnings sold 100 percent of Red Dot’s ownership to its employees. And at Christmas that year, he and his wife gave Red Dot employees a total of $2.2 million for their support and loyalty over the years.
Employees who feel valued and have a stake in the business are one of the drivers that truly set Red Dot apart, says Nick Janus, Red Dot’s CEO. There are now 500 employees, most in Seattle, with 40 people in Memphis, 40 in Ipswich, England and 12 in China.
“I think it is the flexibility of our people and their technical excellence,” Janus says of the Red Dot advantage. “We’ve been around a long time. We were pioneers in this industry. Right now, a lot of our technical expertise is in people who are getting close to retirement, so we are also in a transition period of thinking about technical excellence and rolling it down to the next generation.”
When you’re looking at succession planning, you’re also balancing the need to incorporate new technology, which is important in an industry that closely follows auto manufacturing. From an operations standpoint, Red Dot is making the transition to more robotics on shop floors and software for engineering and industrial design.
In terms of new automotive technology, Red Dot is at the forefront of innovating for hybrid and electric vehicles with the launch of its all-electric E-6100 HVAC unit in 2018. While the company is fielding strong interest across the industries it serves, adoption rates of hybrid vehicles in construction are still relatively slow. The industry needs to figure out a standard voltage for operation, so that the component design and manufacturers can make something that can be cost-competitive. “Otherwise, we are adding too much technology to make it work. There has to be some critical mass,” Janus says.
There is also a lot of talk of autonomous vehicles and how it will impact Red Dot because, put simply, if there is no one in the cab you don’t need the AC, Janus says. But he’s confident that the company’s engineering talent and technical expertise will continue to drive the business forward. This year, for example, will see the launch of electric products that will integrate an engine-off situation so that the driver does not have to continually run the vehicle to keep comfortable.
“It goes back to being a 55-year-old start-up,” says Janus. “In the last decade, we’ve built an entirely new, dynamic leadership team – I think the average age of our executives has dropped 15 to 18 years. Now it’s really a matter of building that next layer down. I think the key area to focus on is engineering and it ties into the STEM programs you see worldwide. We are developing that next generation.” As Red Dot moves into the next phase of its life, we look forward to seeing what emerging technologies are on the horizon for this dynamic and innovative company.