[Congressional Record (Bound Edition), Volume 154 (2008), Part 13]
[Senate]
[Pages 18543-18544]
[From the U.S. Government Publishing Office, www.gpo.gov]




                RECOGNIZING SBE, INC. OF BARRE, VERMONT

  Mr. LEAHY. Mr. President, I rise today to recognize the innovation 
and achievements of SBE, Inc. in Barre, VT.
  For decades, SBE has demonstrated an exceptional ability to adapt to 
the demands of a changing marketplace. The company started as Sprague 
Electric in 1945, but today SBE is using cutting-edge technology to 
develop capacitors for use in green cars, alternative energies, Taser 
stun guns, and advanced military equipment. These innovative products 
have created dozens of quality Vermont jobs that reflect our state's 
commitment towards moving to alternative energy sources.
  I commend Ed Sawyer, president and CEO of SBE, and all of the hard-
working employees in Barre for their foresight and innovation. I ask 
unanimous consent that a September 1, 2008, Burlington Free Press 
article about the company be printed in the Record so all Senators can 
read about the success and commendable business practices of this 
sustainable Vermont company.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

[[Page 18544]]



            [From the Burlington Free Press, Sept. 1, 2008]

 Barre Firm Adapts Products to Survive: Capacitor Company Moves Focus 
               From TV and Stereos to Tasers and Hybrids

                            (By Dan McLean)

       Barre.--SBE Inc., built on 20th century capacitor 
     technology, has survived by continuing to adapt, taking a 
     Vermont-made product and carving a national market.
       SBE has branched off from its trademarked orange colored 
     capacitors, known worldwide as the ``orange drop,'' and is 
     pursuing ``power ring'' technology for hybrid vehicles, 
     alternative energy producers and military applications.
       ``This is sustainable manufacturing. It's a different 
     product mix,'' said Ed Sawyer, president and CEO of the SBE 
     Inc.
       SBE has landed two rounds of U.S. Department of Energy 
     grants to pursue capacitor technology for the burgeoning 
     hybrid vehicle industry. The money is helping to bankroll 
     research and development that are creating jobs. ``We applied 
     for the grant in a competitive process along with 
     approximately 2,000 other firms across the U.S,'' Sawyer 
     said.
       By continuing to innovate, the manufacturer has been able 
     to save itself from becoming obsolete.
       Over a billion capacitors have been made by the Barre-based 
     manufacturer during the past six decades, Sawyer said. A 
     capacitor is an electronic device that can store energy.


                            Keys to survival

       Boom times continued into the late 1960s and early 1970s 
     for the capacitor manufacturer. During that time, about 900 
     employees built capacitors for companies such as AC Delco, 
     Magnavox, RCA and Zenith.
       The industry has changed a lot since Sprague Electric 
     entered into a subcontracting agreement with the Rock of Ages 
     Corp. to manufacture capacitors on their behalf in 1945. SBE 
     Inc. is the successor to Sprague Electric Co.
       SBE has retooled. The company has translated a mid-20th 
     century technology into a modern application for green cars, 
     alternative energies, Taser stun guns and military equipment. 
     As the decades passed, foreign competitors--mostly in China, 
     Korea, Malaysia and the Philippines--began making capacitors 
     for one-quarter to one-third the price, Sawyer said. Aside 
     from the hefty price competition, work was lost because the 
     manufacturing of many electronic devices that use capacitors 
     moved from the U.S. to Asia.
       When Sprague Electric sold the company to SBE in 1986, it 
     was down to 19 employees, Sawyer said. SBE now has about 50 
     employees and is hiring five more engineers to work on 
     capacitors for hybrid cars.
       The company survived, Sawyer said, because of its 
     longstanding philosophy: ``new products need to be developed 
     to keep the company viable.''
       SBE Inc.--which leases 30,000 square feet of the 110,000 
     square feet the manufacturer owned a few decades ago--was 
     created from the shell that Sprague Electric was leaving 
     behind after being decimated by foreign competition, Sawyer 
     said. The management team banded together to buy the 
     operation, forming SBE, he said.
       ``If they didn't have the motivation, it would have been 
     just one more `closed business' story,'' Sawyer said.
       Since becoming president in 2002, Sawyer promoted the 
     development of patents. Three patents have been issued on 
     high-voltage, pulse technologies, and six more are pending, 
     he said.
       Unlike a semiconductor, which requires power be applied to 
     it, a capacitor has the ability to hold a charge and can 
     change direct current to alternating current, which is used 
     to power an electric motor.


                             Job potential

       Job growth, particularly skilled manufacturing positions, 
     should continue at SBE.
       If the capacitor technology SBE is developing for hybrid 
     vehicles is embraced by General Motors, as Sawyer hopes, 
     employment could grow by another 100 people. ``It would be 
     huge job growth for the state,'' he said.
       Rob Peterson, a GM spokesman, said suppliers for the Chevy 
     Volt hybrid vehicle have not been established yet. ``We have 
     made some decisions on suppliers, but we are very, very early 
     on in the process.''
       The Chevy Volt is set to hit markets in November 2010, 
     Peterson said. The car is designed to travel 40 miles on an 
     electric charge before tapping into electricity generated by 
     a gas-fueled engine.
       The bulk of SBE's sales remain in standard capacitors used 
     in industrial lighting, welding equipment and supplies for 
     cell phone towers.
       ``This is still what's paying the bills,'' he said.
       SBE added to its product lineup when it became the 
     exclusive provider for capacitors for Taser International 
     Inc. in 2002, Sawyer said. SBE has sold about a million 
     capacitors for the stun guns carried by police departments 
     across the country, he said.
       SBE landed Taser as a client because of the Barre company's 
     history as an industry leader. ``They actually approached us, 
     basically on our reputation in the industry,'' he said.
       In 2007, SBE's revenue was $3 million to $5 million. Sawyer 
     expects those figures to be 20 to 25 percent higher this 
     year. Despite the sales, earnings are lackluster.
       SBE, a privately held company, is not turning a profit, but 
     that's because profits are being rolled back into the 
     research and development budget, Sawyer said.


                            Funding sources

       Department of Energy grants are helpful, but they don't 
     offset the losses, he said.
       SBE received $850,000 from the Energy Department to perfect 
     hybrid vehicle capacitor technology. The technology could 
     make lighter, smaller capacitors and slice a few hundred 
     dollars from the price of a hybrid vehicle, Sawyer said.
       Grant money isn't the only source powering new endeavors at 
     SBE. The company's eye toward innovation, and reliable 
     revenue stream, caught the interest of ``angel'' investors, 
     Sawyer said. Such investors have poured in more than $2 
     million in the last four years, he said.
       The work for Taser helped SBE get traction with the 
     investment community and the existing capacitor business 
     added a sense of security.
       ``There is less risk than two guys in a garage. We are an 
     existing entity that is paying the bills,'' Sawyer said.
       The military is interested in the power ring technology to 
     shoot ``a high energy laser'' from a vehicle,'' Sawyer said.
       The technology of the capacitors is similar. It's the sizes 
     of the pieces that vary. Capacitors for the hybrid cars are 6 
     inches in diameter, substantially larger than the standard 
     capacitors, which are \1/2\-inch to 1-inch wide.
       Capacitors being used by solar and wind energy producers to 
     store and filter electricity are about 12 inches in diameter, 
     he said.
       York Capacitor--a similar operation in Winooski--closed in 
     2005 after being purchased by a South Carolina company that 
     moved manufacturing to Mexico. York Capacitor failed to 
     adapt, Sawyer said. ``They never changed.''
       ``I don't think we'd be in business today . . . if we 
     didn't make the choices we made to target the markets we are 
     now,'' he said.

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