Jack Roush: more than just a racer...Roush is now a brand

  Another sunset at one of NASCAR's numerous night races (Photo: Getty Images for NASCAR)
  

  
    By Mike Mulhern
    mikemulhern.net

  

    It's been nine months since Roush crash-landed on his way to a Wisconsin air show last summer, a crash that cost him an eye.
    How has he changed?
    Well, perhaps he's a bit more introspective, a little more forgiving of mistakes.
    But certainly no less driven.

    Roush, born during the dark days of WWII, now a racing legend with some 35 years as a business pro at speed, is on track to another NASCAR championship, this one it looks like with Carl Edwards, though the year is still young.
    And he multi-tasks as fiercely as ever, agilely switching gears mentally to whatever the challenge at hand.
    But after two near-death experiences in the last few years…
    "I've had two airplane wrecks in the last 10 years. And after each one, I had to ask myself 'Have I wasted my life? Is there something else I'd rather be doing?'
    "But really the only sadness I have is that I don't have more time for my grandchildren."
  
   

    
Jack's Panama. So Roush must be nearby (Photo: Getty Images for NASCAR)
   

    Risk, in the NASCAR world, comes in many different forms.
    Like Edwards, in a promotional stunt, leaping off Las Vegas' Stratosphere, 800 feet up….and those victory backflips.
    "Jack has pointed out he doesn't think it is the best idea (doing backflips at the car), but he seems to be alright with it," Edwards says.
   "Jack is a risk taker himself. He doesn't really tell people what risks not to take. The only advice Jack has had for me is that 'If you are going to be dumb, you have to be tough.'"
   And Jack Roush is certainly tough.

   And diversified.
   In fact the web of various business enterprises which this stock car racing legend is involved in is labyrinthine.
    

  Yes, this season Roush and his men, particularly Edwards, the Sprint Cup tour leader, are on top of the racing world. They've got one of the sport's top computer simulation programs, and they've got the sport's newest race engine, Ford's FR9. Edwards will be one of the favorites in Saturday night's Southern 500.
   But Jack Roush is not just NASCAR racing.
   Sure, as a Ford man, Roush, through his performance aftermarket operation, is milking the new Ford Mustang for all its worth. (Jack Roush Jr., who runs the Grand-Am series, is running a Roush Mustang in this week's 'One Lap of America,' that rather strained version of the once-outrageous coast-to-coast Cannonball Run. And Susan Roush-McClenaghan, Roush's drag racing daughter, is running a propane-powered Mustang.)
    But there is more to 'Panama Jack' than just racing.
   And it is this back-story that gives a better glimpse into the man now in his 23rd season in NASCAR.

    Once, long ago it seems now, Roush briefly opened up this other half of his automotive empire -- the part of Jack Roush Inc. that NASCAR fans never see. It was quite eye-opening for those who only saw Roush as a sparkplug-checking, carburetor-tuning racer and P-51 war bird aficionado.
   An automotive world just west of Detroit that did all sorts of arcane automobile development work, for the EPA and others, amid huge banks of dozens of engine dynos and special acoustic test facilities.
   Roush Industries...Roush Enterprises...entertainment, life sciences, aerospace, alternative fuels, defense, aerospace, and of course automotive.
   It's how Roush got here, into NASCAR, via drag racers, sport cars, and off-road.
   Richard Childress likes to hunt around the world.
   Rick Hendrick has car dealerships galore.
   Roger Penske has world-wide business interests.
   Jack Roush likes to tinker with machinery. In fact, his first NASCAR hauler was a full machine shop on 18 wheels.
   Now Roush is a brand himself.
   Not bad for a guy who never really wanted to be a businessman at all.
  

  

   
Reading sparkplugs, tuning carburetors. Some people play golf; Jack Roush prefers racing (Photo: Getty Images for NASCAR)
  

    The Roush business empire, under its various logos:
    "The racing is about 30 to 40 percent of what we do; the engineering side is 60 to 70 percent," Roush says.
   "It's a small company, a private company. Built on entrepreneurial spirit, that was related to racing."
    Roush is a racer who somehow got into the business side of it all almost by surprise.
   "As I was buying machining equipment – mills and lathes and grinders and dynamometers and things – that coincided with the time (in the mid-1970s) when the car makers decided they couldn't afford to have the resources to do all their own work.
   "In the 1950s and 1960s Detroit's Big Three had the capability to redesign every engine and every car every year. And since they only redesigned engines every five years and cars every three years, they had a lot of unused capacity…people waiting for their next assignment.
   "As the imports started putting on price pressure (in the 1970s and 1980s), the Big Three decided to reduced costs. So they decided to go to outside vendors, to share expenses."
   And that's how Roush Industries wound up doing work for all three Big Three.
   "It was a perfect storm for me – I was building capability for my race cars at that time, so I was able to get not only a composite lab but also a noise vibration operation, which was of some interest to race teams…which we are still using, trying to figure out how to minimized vibrations in our shifters.
   "So all these things started serving dual purpose."
   That was back in 1976, years before he got into NASCAR. When he was drag racing, road racing, off-road racing, Pikes Peak….
 
  
  

  It always helps to have friends in high places: Jack Roush (R) with Ford's Edsel Ford II (Photo: Autostock)
  

   Since then he's expanded Roush Industries into EPA certification projects, working on tailpipe emissions, and other similar projects.
   Now he's even into sports equipment development: "If you have tennis elbow, we have a vibration dampening device, patented….
   "And new golf shafts, increasing range, because of less vibration."
   And now medical equipment too.
   Medical equipment?
   Yes, Roush has just opened a medical division in Boston.
   It's the other side of Jack Roush, a Warren Buffett side perhaps, diversifying and expanding -- most recently with a $1 billion project to built electrical recharging stations for cars like the Chevy Volt and Nissan Leaf.

   "My business in Detroit has been the gambler's dilemma – if you look at the myriad things we have going on, 60 percent of that is viable and profitable every year as an on-going business, and 40 percent is not," Roush says. "Now 20 percent of that 40 will come back, the rest will not. So you have to look at the things that work well, and fold the others.
   "So if every year you lose 20 percent of your volume, you have to start new projects.
   "When the economy went in the tank, we were looking at maybe 60 percent of our projects not being viable. So we had to think about the things we would fold and the things that we would hold, and the new things we would start.
   "And one of our new projects right then was a biomedical company that had patents and was doing laboratory tools for pharmaceutical companies, which we bought, opening an office in Boston --  because Boston is to the medical industry what Detroit is to the automotive industry.
   "We have exceeded our expectations there. So even though it's very small, we think it will turn into something."

   
Jack Roush Jr., at 37: a racer himself. And where will he fit into his father's racing/business empire? (Photo: Getty Images for NASCAR)

   That's not the only curious investment this stock car racing star is making.
   "We've invested in propane – as an alternate fuel. It is 98 percent produced on the North American continent and 90 percent produced in the United States.
   "Propane is lower in emissions, lower in particulates, lower in oxides of nitrogen, while in the same power as gasoline. And it has government incentives for fleet users."  (http://www.roushcleantech.com/ )
   Think NASCAR's fleet of long-haul truckers.
   And more.
   Think of T. Boone Pickens, the Midwestern oil man who, as oil prices soar, points out that natural gas/propane is five times as economically efficient as diesel fuel or gasoline. (That means if gasoline is $5 a gallon, the same amount of energy from natural gas/propane would be about $1.)
    Now propane is not natural gas; propane is liquid at 60 degree F at 200 psi, while natural gas has to be at least 3,000 psi. And a propane filling station would be not much more costly than a standard filling station, about $10,000 to $15,000, Roush says, while a similar natural gas filling station would cost maybe $200,000 to $300,000, and that would be a much more complicated operation.
   Roush says he's working on a NASCAR propane operation, to turn the hauler fleet into propane trucks. "NASCAR is very active in this idea," Roush says.

    And Roush's industrial empire is into more:
   "The other thing we've done is -- looking at the allure of the Far East, Singapore, China, Japan, for making tooling for injected molding of plastic parts as fading – to triple our investment in that business….figuring that the price of gas would be in the $4 to $5 a gallon range, with thus a rush by the automobile companies to redesign their cars to take 20 percent of the weight out."
    So Roush Industries is expanding. After cutting from 2200 to 2500 people back to 1700 during the economic malaise, "Now we're up to 1900, and I've got requisitions for recruiting 200 more people to hire. We've been hiring for a year now, and working a lot of overtime."

   On the side, Roush is also general manager for an official FAA-authorized repair station operation for the Merlin engine, the 1600-cubic inch Rolls-Royce WW II war bird engine, used in P-51s and other planes. ( http://bit.ly/l2SOv1 )
   And Roush also specializes in armored vehicles for high-profile people around the world.
   While Roush himself actively runs Roush Fenway Racing, he lets CEO Evan Lyall, his long-time business partner, handle much of the heavy lifting for Roush Industries.
   It is a rather impressive, if somewhat curious, portfolio for the sports-businessman.

   And he concedes his life hasn't quite turned out the way he once envisioned it.
   "Since I didn't have Business 101…and I watched my father struggle and agonize,  back in the 50s and 60s, over small businesses that didn't work too well….I had no great interest in this.
   "I wanted to be a scientist, an engineer.
    "But I figured out that in order to make my race car operation work, I needed a business format around it, and not to be doing it for somebody else but rather for myself."
   Still, Roush insists "I'm not really qualified" to deal with the business intricacies of Roush Industries' various arms. "And I don't lay awake at night thinking about things I'd like to do with the business. I just work with Evan and Doug (Smith) with problems."

    Which goes back to his father….   
    Every man is his father's son, in one way or another.
    "My dad was a farm boy, and my mother came out of a farm family too. My dad went to a two-year school in Columbus, Ohio, and learned about how to put factories together. The assembly lines, the steel, the structures….
   "He was mechanically inclined. He built and sold crystal radios; remember them?
   "He wired the farm house his family lived in. He was an electrician, a carpenter, a mechanic…
    "He was really skilled technically, a jack-of-all-trades.
    "While he rolled around the South Pacific during the war, on the battleship South Dakota, a 500-pound bomb hit the turret he was in one day. So he made a deal with his Maker that if he survived the war, he'd move back to the country, not the city.
    "And he did.
    "He bought a nice little ice-and-coal business…
    "But the ice-and-coal business was by then being pushed aside by oil-fired heat in homes and refrigerators.
   "So then he decided to go into the food locker business, for little Manchester, Ohio. But home freezers were coming in….
   "He never took bankruptcy, but nothing he invested in ever really took off."

   By the time Roush went off to college, his father had settled in a plant manager in manufacturing.
   But the business misses had Roush himself wary of that side of life.
    "Watching all that, me being a business man and understanding markets and workers, rather than sign myself up for that, I just wanted to work for the aerospace industry….
   "But that wasn't in the Midwest.
   "So I went to work for Ford.
   "But once I became successful in drag racing, I came to the realization I really wanted to be a businessman, and started my business in 1976.
   "The point is if I'd had more money in 1976 than I did have, I wouldn't have been as successful. Because I didn't have the education or inspiration."
   Building Roush Industries has been an exercise in patience, Roush says: "I waited until I had a demanding opportunity and then had to ask myself 'Do you want to buy this piece of equipment?'
    "Roush Industries has never built a building, but we have 80 to 85 buildings we occupy, in Detroit, Charlotte, Minnesota, Colorado and Florida."
   
    Through it all Roush says "I've been amazed that I survived.
    "The first 20 years, virtually every decision I made to borrow I had to give a personal guarantee for.
    "For the first 10 years every decision I made we literally bet the company: 'If this doesn't work, we'll lose the company.'
    "And for the next 10 years every other decision we made we bet the company.
   "Every thing we've tried to do hasn't been successful…but the ratio of things that worked has been at least four-to-1."
  

   
Jack Roush: another NASCAR championship looming? (Photo: Getty Images for NASCAR)