Bookmark and Share
Facebook
Twitter
LinkedIn

TRACOR

TRACOR. Tracor, headquartered in Austin, also known as Associated Consultants and Engineers and Texas Research Associates, is a diversified international technological products and services company involved in research and development, engineering, manufacture, and marketing of defense and commercial electronics, including electrical components for radios, televisions, stereos, home appliances, autos, trucks, computers, and aircraft. Tracor has served as a center for start-up technology companies, and is an example of efforts to more rapidly commercialize university technological discoveries, or establish partnerships between universities and commercial firms. Tracor headquarters are located near the main University of Texas campus, and the firm has long obtained its junior scientists and engineers from among university graduate students. Tracor was founded at the start of an electronics business boom that produced Massachusetts's Route 128 and California's Silicon Valley and became a role model for entrepreneurs that made Austin a major player among high-tech research centers. The company was founded in 1955 as Associated Consultants and Engineers to conduct research and development in the physical sciences for United States government agencies, private institutions, and industry. Its founders were three physicists associated with the University of Texas at Austin-Richard Lane, Chester McKinney, and Jess Stanbrough-along with University of Texas mechanical engineering professor Frank W. McBee. Lane, who was born in Eagle Pass and received his degree in physics from the University of Texas in 1941, was an acoustical engineer in the sonar section of the Radio Corporation of America and head of the Acoustics Division of the Applied Research Laboratories at the University of Texas before joining the firm. McBee, the son of a Travis County justice of the peace, worked at Austin Radio Company during the Great Depression and completed his degree at the University of Texas in 1947.

After making initial sales to Union Carbide Corporation in 1957 and filling important contracts for the United States Navy in 1959, the firm, which was among the first Austin businesses to be racially integrated, changed its name to Texas Research Associates in 1960. After a merger with Textran Corporation of Austin and Rudmose Associates, Incorporated, of Dallas in 1962, it was henceforth known as Tracor. Headquarters were established in a former Austin grocery store in 1963, and in 1964 the company made its first public stock offering. Major acquisitions were made in the 1960s, including Sulzer Laboratories and Littelfuse, Incorporated, of Illinois, a manufacturer of electronics and mechanical products, Berkeley Science Laboratories, and Marine Acoustical Services of Miami. By 1969 the firm operated in thirteen states, Mexico, and Puerto Rico. Originally involved primarily in research and development, Tracor moved increasingly into the manufacture of instruments, components, and military products. Its social scientists explored human response to sonic booms and other problems and designed and developed scientific instruments, antisubmarine warfare systems, decoys for missiles, countermeasures to help military planes fool enemy weapons, and other products for specific market niches. Frank McBee, who became president and chief executive officer of the firm in 1970, is credited with helping it to survive an unsuccessful effort to compete with IBM in computer hardware in the 1960s.

In 1973 the corporation was reincorporated in Delaware, and by 1984 Tracor appeared on the Fortune 500 list of the nation's largest industrial companies and had become one of Austin's largest employers. At its height, company sales reached $700 million, and employees numbered 11,000 worldwide. Divisions of the firm included components, instruments, defense electronics, applied science, aerospace, and flight systems. By 1985, however, Tracor's fortunes began to change when the company became the subject of disputes over defective products and a criminal investigation by a Fort Worth federal grand jury regarding pricing of government contracts. Revenues in 1986 reached over $632 million, but profits declined significantly. In 1986 Westmark Systems, Incorporated, a defense electronics holding company owned by the Dallas-based merchant banking firm of Elvis Mason and Randy Best, run by chairman and admiral Bobby Inman, acquired the company in a $866 million dollar leveraged buyout. Inman formerly headed Microelectronics and Computer Technology Corporation, an Austin-based computer research consortium. Among Westmark's distinguished early board members were executives from Temple-Inland, Xerox Corporation, the Union Pacific Railroad, and Robert Strauss, former chairman of the Democratic National Committee. By 1989 Westmark was in financial trouble, enhanced by the oil crash of 1987, and planned to sell its nondefense-related manufacturing subsidiaries to reduce its debt. By 1990 the instruments division had been sold to Baker Hughes, but in 1991 the company filed for reorganization in bankruptcy court and resumed operations under the direction of James Skaggs as president, chairman, and chief executive officer. By this time, Tracor had operations in twenty states and four counties, and employed 7,000 workers worldwide, of which roughly 930 were in Austin. Back on its feet, the firm nearly doubled its size in 1993 by acquiring Vitro Corporation, a firm headquartered in Rockville, Maryland, which engineered computer systems and software for the military and government agencies.

Over the course of its forty year history, Tracor has spun off more than twenty companies, including Austron, Radian, Pinson Associates, Melster Engineering, Weed Instrument, Texas Research International, Galaxy Microsystems, SGE, Zycor, Continuum, Nova Graphics International, and McBee's Research Applications, founded in 1988. McBee became a key Austin businessman, sponsored local art and a new Austin art museum, acquired numerous works by local artists for Tracor's new 150-acre East Austin headquarters, and supported efforts to protect the region's buzzard population. Richard N. Lane established a scholarship fund at the University of Texas and served as president of Lamac Environments, an Austin-based real estate firm. Among other community involvements, Tracor established the Tracor Scholar Program in 1986 to recognize outstanding local students and faculty.

BIBLIOGRAPHY: 

This is Tracor (Austin: Tracor, 1983).

Diana J. Kleiner

Citation

The following, adapted from the Chicago Manual of Style, 15th edition, is the preferred citation for this article.

Diana J. Kleiner, "TRACOR," Handbook of Texas Online (http://www.tshaonline.org/handbook/online/articles/dnt03), accessed July 10, 2014. Uploaded on June 15, 2010. Published by the Texas State Historical Association.