Donaldson Co., the Bloomington-based company that clears $3 billion in revenue making industrial filters for vehicles, buildings, factories and even food, seems at first glance like the kind of global manufacturer vulnerable to tariffs and trade wars.
For decades, however, a key strategy at Donaldson has been building things in the markets where it sells them.
Donaldson has 65 plants around the world, and three-fourths of everything they make is consumed in the country that makes it. As a result, it ships relatively little from one part of the world to another.
“You hear a lot of companies say they have hundreds of millions of dollars’ worth of tariff exposure. That‘s not where Donaldson is,“ CEO Tod Carpenter told me recently. “We have been able to, fortunately, pretty much offset all that is taking place. It‘s because of our operations and business model and the overall diversity in the company and the fact that we’re very global.”
Eighteen of its plants are in the U.S. Its largest is in Poland. Donaldson for decades has been a fixture among Minnesota’s largest publicly traded companies. It ranks 20th this year on the Star Tribune 50 with about $3.6 billion in annual revenue.
Carpenter, who studied manufacturing technology in college, has been with Donaldson for 29 years, including the last 10 as CEO. Before joining the company, he spent 13 years at Hughes Aircraft Co., which became a part of Raytheon in the late 1990s.
I wrote recently that I was not worried about the place of American manufacturers in the world, a topic that has bubbled around the nation’s consciousness for decades and seems to undergird President Donald Trump‘s trade policy. China has passed the U.S. in value of goods produced, but that doesn’t seem surprising to me given its 4-to-1 population advantage. The U.S. is second in value of goods produced.
Carpenter made it clear he’s not as sanguine about what‘s happening to U.S. manufacturers.