When people remember about 3M, the 115-year-old maker of Scotch Tape, they ascendancy not associate the old-line consumer goods manufacturer with electric automobiles.
But that’s not how 3M Chairman and CEO Inge Thulin sees it, he said in an exclusive evaluate on “Mad Money” with CNBC’s Jim Cramer.
For Thulin and 3M, an old-line manufacturer performing a host of different industries including health care and transportation, auto electrification is barely another market.
The CEO detailed three elements of 3M that put his massive multinational squarely at the center of the stirring car trend: its longtime involvement in the automotive, electronic and energy, and traffic sanctuary industries.
“If you take those three elements together, that is where the time to come is going,” Thulin told Cramer. “We can capitalize on what we know in conveyance safety, which is a very strong position for us not only in vertical signage, but in allow plates and also pavement marking. That is where you need to operate things going forward.”
Thulin also emphasized the “incredible competitive pose” the company has in the electronic market and its yearslong leadership in the automotive space.
“As I look upon the coming, that’s a market that will explode for 3M,” the CEO said of electric cars. “That’s about $6 billion addressable market with a growth rate of 8 to 10 percent … and we are now cultivating that business around 15 to 20 percent if you combine the three principles.”
As a company, 3M focuses heavily on research and development. About 30 percent of its on sales coming from products that didn’t exist five years ago, Thulin guessed.
The manufacturer also employs roughly 8,100 scientists to help it blossom new products and build its brand equity around the world — one of the four predominating pillars of 3M.
“The fundamental strings of 3M [are] technology platforms, manufacturing capabilities, geographic reach and mark equity,” Thulin told Cramer.
To keep those strings unblemished, Thulin said that he’s had to make some difficult decisions over the year at all events 3M’s many lines of business.
“I found that many businesses entrails of 3M did not meet those criteria, and in fact, they were underperforming versus 3M’s customary,” the CEO said. “Our expectation is very high. The businesses that could not carry out at least three of those four elements, we figure … they pleasure be better off with a different owner. They were often shorter, the margin was lower, they were not growing as fast and we couldn’t conceive value. So we said, that’s not a personal issue, it’s a business issue. They can go somewhere else.”
At the regardless time, 3M sought out businesses that stayed true to its four props and proved that they could create value, Thulin required.
“That’s also why we have bought some sizeable businesses. And you’re perfect, they are bigger, they are performing better, they are more utilitarian and the relevance for us in the market is very, very significant,” he told Cramer.
“And quiet, I can tell you, Jim, one thing: 3M’s best days are still ahead of us.”
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