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Merger and international expansion

1917-1949: AB Diesels Motorer

In 1898, acquired the Swedish rights to produce Rudolf Diesel's patented engine. A new company was founded for this: AB Diesels Motorer. Skillful engineers gradually perfected the original licensed design, which was quite crude. In 1906, a young engineer named Jonas Hesselman came up with an innovation: a mechanism for reversing the diesel engine. This opened up the market for large diesel engines for ships.

A breakthrough for AB Diesels Motorer came in 1912, thanks in part to an event in which the company was indirectly involved. The year before, Norwegian explorer Roald Amundsen reached the ice barrier around the South Pole. His ship, Fram, was equipped with a 180-hp marine engine that worked perfectly in rough conditions. On his way back from the pole, Amundsen sent a telegram to Diesels Motorer that read: “Diesel engine excellent.” His discovery inspired Diesels Motorer to name all the company´s engines “Polar.”
In 1917, AB Atlas merged with AB Diesel Motorer, becoming AB Atlas Diesel. At the same time, the production of steam locomotives was phased out. Atlas delivered its 174th and last locomotive in 1917. The merged companies enjoyed strong demand for their products until the Depression struck in the 1920´s.

War years

Atlas Copco history - 1917-1949
At the outbreak of World War I, Atlas had already established a profitable export market through a network of foreign sales agents. During the war however, this network collapsed and export of pneumatic tools came to a complete standstill. In the post-war years, Atlas Diesel concentrated its development resources and export efforts on the diesel engine business.

Move to Sickla, Nacka

To strengthen liquidity and reduce interest expenses, Atlas Diesel decided to sell off some buildings and share-holdings in 1924. A large piece of land down town Stockholm, where the workshops of Atlas had been located a half-century earlier, was sold. The most profitable parts of the Atlas operation, air compressors, pneumatic tools, and compression-ignition engines, was moved to Sickla, south-east of Stockholm. Less profitable activities such as a sheet-metal department, transportation equipment manufacturing and a carpentry workshop were shut down entirely.

Growth in compressed air

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Despite the focus on diesel engines, it was the compressed air tools area that turned out to be the most successful and profitable. In the development work of the compressed air tools, the principle of close customer interaction led to several important design breakthroughs.

Gustaf Andersson developed a pneumatic chipping and riveting hammers with advanced design and a spool valve engine in 1910. In 1930, he developed the important light RH pneumatic rockdrill, that became part of the Swedish Method. Other important innovators were David Roos, who developed a light and high efficiency compressor with a revolutionary efficient and light vane type motor in 1930, and Herman Pyk and John Munck, innovators of the direct injection portable compressor in 1933.

The Swedish Method

In 1936 Atlas Diesel introduced a one-man pneumatic rock drill that was light, strong and efficient. The drill could be equipped with a pneumatic pusher leg, developed by Erik Ryd, that rationalized rock drilling considerably. The combination of a strong but light drill with a pneumatic pusher leg and tungsten carbide drill bits gave superlative performance.

After the wars, Atlas worked on increasing exports. In post-war Europe competition was tough and prices were low on drilling equipment. The general manager at the time, Walter Wehtje, realized that Atlas had to offer the customers something more than the actual drilling tool in order to compete on foreign markets. Atlas presented the “Swedish method,”  a modern and lighter drilling technology, compared to conventional heavier methods. It combined a light rock drill with pusher leg and drill steels with tungsten carbide drill bits. With “the Swedish method" one man could handle one machine and the method became known all over the world as the superior productivity solution in rock drilling technology.

Worldwide sales and service

The Swedish method offered obvious advantages over competitors and world markets opened up for the company. Specially trained drill masters and engineers were sent worldwide to demonstrate drillings at customer locations. It was not hard to convince customers of the superiority of the Swedish method.

But to gain worldwide sales, Atlas needed to establish local presence in the new markets in order to support and serve customers in a satisfactory way. Management immediately established more than 20 new sales companies. This strategy paid off. In the second half of the 1940s, sales of compressed air equipment increased ten-fold; five-fold in the 1950s.

End of the diesel era

Diesel engine production gradually lost its importance and the business was finally sold in 1948. In the end, Atlas Diesel had produced a total of 5 447 diesel engines.