E-Z-GO 2011 Annual Report Download - page 16

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Jacobsen designs, manufactures and sells professional turf-maintenance equipment, as well as specialized turf-care vehicles.
Brand names include Ransomes, Jacobsen and Cushman. Jacobsen’s customers include golf courses, resort communities, sporting
venues and municipalities. Products are sold primarily through a worldwide network of distributors and dealers, as well as factory
direct. Jacobsen has two major competitors for professional turf-maintenance equipment and several other competitors for
specialized turf-care products. Competition is based primarily on price, product features, product quality and reliability and
product support.
Powered Tools, Testing and Measurement Equipment
We design and manufacture Powered Tools, Testing and Measurement Equipment through our Greenlee business unit. Greenlee
designs and manufactures powered equipment, electrical test and measurement instruments, hand and hydraulic powered tools, and
electrical and fiber optic assemblies under the Greenlee, Klauke, Paladin Tools and Tempo brand names. These products
principally are used in the electrical construction, maintenance, telecommunications, data communications, wiring, utility and
plumbing industries. Greenlee distributes its products through a global network of sales representatives and distributors and sells
its products directly to home improvement retailers and original equipment manufacturers. Through joint ventures, Greenlee also
sells hand and powered tools for the plumbing and mechanical industries in North America and hand tools for the home center,
construction, industrial manufacturing and automotive channels in China. The Greenlee businesses face competition from
numerous manufacturers based primarily on price, product quality and reliability.
Finance Segment
Our Finance segment, or the Finance group, is a commercial finance business that consists of Textron Financial Corporation (TFC)
and its consolidated subsidiaries, along with three other finance subsidiaries owned by Textron Inc. In the fourth quarter of 2008,
we announced a plan to exit the non-captive portion of the commercial finance business of our Finance segment while retaining the
captive portion of the business that supports customer purchases of products that we manufacture. The non-captive portion of this
business is based primarily in North America and includes the following product lines: Golf Mortgage, Timeshare and Structured
Capital. The exit plan is being effected through a combination of orderly liquidation and selected sales. During 2011, we reduced
our total finance receivable portfolio by $1.7 billion primarily through liquidations, mark-to-market adjustments on certain
portfolios and impairments. Depending on market conditions, we expect continued progress in liquidating the remaining $950
million in the non-captive portfolio over the next several years.
Our Finance segment continues to originate new customer relationships and finance receivables in the captive finance business,
which provides financing primarily for new Cessna aircraft and Bell helicopters and, to a limited extent, for new E-Z-GO and
Jacobsen golf and turf-care equipment. We also provide financing to purchasers of pre-owned Cessna aircraft and Bell helicopters
on a limited basis. The majority of new finance receivables are originated outside the United States. New originations in the U.S.
are primarily for purchasers who have had difficulty in accessing other sources of financing for the purchase of Textron-
manufactured products.
In 2011, 2010 and 2009, our Finance group paid our Manufacturing group $284 million, $416 million and $654 million,
respectively, related to the sale of Textron-manufactured products to third parties that were financed by the Finance group. Our
Cessna and Industrial segments also received proceeds in those years of $2 million, $10 million and $13 million, respectively,
from the sale of equipment from their manufacturing operations to our Finance group for use under operating lease agreements.
The commercial finance business traditionally is extremely competitive. Our Finance segment is subject to competition from
various types of financing institutions, including banks, leasing companies, commercial finance companies and finance operations
of equipment vendors. Competition within the commercial finance industry primarily is focused on price, term, structure and
service.
Our Finance segment’s largest business risk is the collectability of its finance receivable portfolio. See “Finance Portfolio
Quality” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on pages 30 and 31 for a
discussion of the credit quality of this portfolio.
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Textron Inc. Annual Report • 2011 5