EghtesadOnline: Dyson Ltd. continues to prove making high-priced vacuum cleaners is a lucrative and growing business.
The closely held U.K. firm said total sales grew 45 percent in 2016, to 2.5 billion pounds ($3.12 billion), largely due to demand for a new line of battery-powered cordless cleaners. The models, first introduced two years ago and costing about 500 pounds each, are the fastest-selling vacuums in the company’s 25-year history. Dyson’s profit excluding some costs surged 41 percent to 631 million pounds, according to Bloomberg.
The new vacuum design moves the device’s motor to near the hand grip, allowing it to double as a traditional upright vacuum or a handheld cleaner to suck up debris in harder-to-reach spaces. James Dyson, the company’s founder, said he was surprised by the adoption. “They are growing at a phenomenal rate,” he said in an interview.
Dyson, with about 3,500 employees, has for years been expanding beyond vacuum cleaners, with air purifiers, heaters, fans and robots. A new hair dryerthat took four years and $70 million to develop was introduced last year. The company has committed to spending 2.5 billion pounds on future technologies, including artificial intelligence and robotics.
Among Dyson’s biggest bets are batteries. Last year, the company said it would spend 1 billion pounds on research over the next five years. In 2015, it acquired the maker of solid state batteries Sakti3 for $90 million.
While batteries are a key feature of its vacuum cleaners and other existing Dyson products, the research has fueled speculation that Dyson may eventually enter the electric-car market. Dyson declined to comment on long-term plans, but said "there will be lots of new entrants into the automotive market."
"If we can develop batteries that are four times as dense and don’t heat up and can be charged very quickly, that’s going to open up a huge number of possibilities, not just for what we make now, but products that people would never conceive of," he said.
As many larger retailers struggle with competition from online sellers, Dyson is opening stores of its own. The company plans to open 25 shops this year, including in San Francisco, New York and China.
"There are fewer and fewer retail outlets," Dyson said. "We want people to see the technology, try it out and get a very good experience of it. That’s not always possible in traditional stores."