Hughes Tool Company

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Hughes Tool Company
IndustryDrilling, manufacturing
FateMerged with Baker International
SuccessorBaker Hughes
FounderHoward R. Hughes Sr.
Key people
Howard Hughes
ProductsDrill bits
The manufacturing operations of the company at 2nd and Girard Streets in Houston, Texas, where it was located in the 1910s. Today, the site of the building is on the campus of University of Houston–Downtown.
A February 1914 advertisement for the Sharp-Hughes Tool Company in Fuel Oil Journal.

Hughes Tool Company was an American manufacturer of drill bits. Founded in 1908,[1] it was merged into Baker Hughes Incorporated in 1987.


The company was established in December 1908[1] as Sharp-Hughes Tool Company when Howard R. Hughes Sr. patented a roller cutter bit that dramatically improved the rotary drilling process for oil drilling rigs. He partnered with longtime business associate Walter Benona Sharp to manufacture and market the bit. Following her husband's death in 1912, Sharp's widow Estelle Sharp sold her 50% share in the company to Howard Hughes, Sr. in 1914.[2] The company was renamed Hughes Tool Company on February 3, 1915.[2]

When Hughes Sr. died in 1924, 75% of the company was left to Howard Hughes Jr., who at the time was a student at William Marsh Rice Institute (now Rice University). According to Howard Sr.'s will, his son was to initially receive a 25% share, his wife 50%, and the remaining 25% was to be divided between various family members. Since Howard Sr.'s wife had died some years earlier, and the will had not been updated to reflect that, Howard Jr. automatically inherited his mother's shares. Resentful of his relatives' attempts to run the business, Howard Hughes Jr. had himself declared a legal adult (21 being the age of majority at the time), and bought out his relatives' minority share in the business.[citation needed]

Under Howard Jr.'s ownership, Hughes Tool ventured into the motion picture business via Hughes Productions during the 1920s, and into the airline business in 1939 with the acquisition of a controlling interest in Transcontinental and Western Air (later renamed Trans World Airlines).

In 1932, Hughes formed Hughes Aircraft Company as a division of the Hughes Tool Company. Hughes Aircraft thrived on wartime contracts during World War II (though not on the only two contracts it received to actually build airplanes), and by the early 1950s was one of America's largest defense contractors and aerospace companies with revenues far outpacing the original oil tools business; in 1953, Hughes Aircraft became a separate company and was donated to the Howard Hughes Medical Institute as its endowment. Hughes Aircraft's helicopter manufacturing business was retained by Hughes Tool Co. as its Aircraft Division until 1972.

For a period of time in the 1940s to late-1950s, Hughes Tool owned the RKO companies, including RKO Pictures, RKO Studios, RKO Theatres, and the RKO Radio Network.

During the early 1960s, a wholly owned subsidiary Hughes Dynamics was created, that offered consulting and services in data processing, information technology, credit information processing, and advanced business techniques and management methods.[3] After some $9.5 million of Hughes Tool money was invested in it, results were deemed not acceptable, and it was quickly shut down.[4]

For a brief period in the early-1960s, Hughes Tool held a minority stake in Northeast Airlines. Hughes Tool's majority stake in TWA was sold off in 1966. Two years later, in 1968, Hughes Tool Company purchased the North Las Vegas Air Terminal.

In the late-1960s, Hughes Tool ventured into the hotel and casino business with the acquisition of the Sands, Castaways, Landmark, Frontier, Silver Slipper, and Desert Inn, all in Las Vegas. Hughes Tool also purchased KLAS-TV, Las Vegas' CBS affiliate; in the early-1970s, Hughes Tool ventured back into the airline industry with the takeover of the largest regional air carrier in the western United States: Air West, renamed Hughes Airwest following the purchase. Hughes Tool also briefly owned Los Angeles Airways, a small airline operating a commuter service with a fleet of helicopters.

In 1968, Hughes Tool purchased Sports Network Incorporated and renamed it the Hughes Television Network, with Dick Bailey continuing as president.[5]

The huge main plant for Hughes Tool located in Houston, Texas, fronting Harrisburg Blvd., had grown to be one of the biggest oil tool manufacturers in the world. It had the latest, largest, and most automated equipment for foundries, forging, heat treating, and machining anywhere, at its peak during the Texas oil boom, it was a center for manufacturing, design, research, metallurgy, and engineering for oil field technologies. This included the drill bit (well) and tool joint product lines critical for oil and gas drilling, some of the first technologies for ram blast bits for drilling in mines, geothermal drilling, and a hydraulic powered jackhammer known as the Hughes Impactor.[6] It also manufactured a line of truck and crane-mounted earth augering machines ("diggers") that were most commonly used to produce holes up to a depth of about 120 feet (37 m) for building and bridge foundations. It even had a fully functioning drilling simulator inside its main research lab where production or prototype drill bits could be tested on any kind of rock at temperatures and pressures normally encountered in actual drilling operations; in 1972, Howard Hughes sold the Hughes Tool Company; it had been the consistently profitable part of his empire, and produced the profits that built all the rest from the very beginning. This became the "new" Hughes Tool Company while the remaining divisions of the business were placed in a new holding company, the Summa Corporation.

Hughes Tool Company merged with Baker International to form Baker Hughes Incorporated in 1987.[7]


  1. ^ a b Botson, Michael R. (2005). Labor, Civil Rights, and the Hughes Tool Company. Texas A&M University Press. ISBN 9781603446143.
  2. ^ a b Barlett, Donald L.; Steele, James B. (11 April 2011). Howard Hughes: His Life and Madness. W. W. Norton. p. 38. ISBN 978-0-393-07858-9.
  3. ^ "Companies Plan Sales, Mergers" (PDF). The New York Times. April 19, 1963. p. 69.
  4. ^ Barlett, Donald L.; Steele, James B. (1981). Empire: The Life, Legend, and Madness of Howard Hughes. New York: W. W. Norton & Company. pp. 401–402, 554.
  5. ^ "Hughes buys TV Network". The Milwaukee Journal. UPI. September 7, 1968. p. 18. Retrieved 30 May 2012.
  6. ^ US 3699675, Edward M. Galle, "Hydraulic Impactor Methods and Apparatus", issued 1972-10-24, assigned to Hughes Tool Company 
  7. ^ BERKMAN, LESLIE (1987-04-04). "Baker, Hughes Tool Merge, Creating an Industry Leader". Los Angeles Times. ISSN 0458-3035. Retrieved 2018-02-22.