An LVT system

LVT HQ and the kibbutz. In background is the Golan Heights, with snow-capped Mount Hermon towering over it (the part of Hermon you see is in Israel--the mountain straddles three countries: Israel, Lebanon, and Syria).

An LVT system.

Lehavot Habashan Secretary Yori Kandel workd in the factory during high school and again at age 21 following his IDF service.

“People began to work outside of the kibbutz and earn nice salaries, and they didn’t like having to split their wage,” LVT Sales Director and lifelong Lehavot Habashan resident Misha Goldemberg recalls. “If you lived here but you wanted to visit family abroad, the kibbutz would tell you to wait in line. This flowed into every aspect of life, such as buying a car, and people didn’t want to hear about it.”

An LVT system.

For This Socialist Business, Problem Solving Is Literally Putting Out Fires

Lehavot, as it is known in Israel, dominated the domestic portable fire extinguisher market until the 1990s. But it wasn’t enough to support its owners’ communal lifestyle. Here's what happened next.

When members of Socialist youth group Hashomer Hatzair (The Young Guard) founded Lehavot Habashan on the foothills of the Golan Heights in 1945, little did they know that the name they gave their kibbutz--“Flames of the Bashan,” from a story in Genesis 14:5--would have a literal connection to the company that would eventually sustain their community.

LVT, wholly owned by the kibbutz, is a specialist in fire suppression systems for military and civilian purposes. It created the world’s first multi-zone fire protection system for vehicles and has worked on the U.S. military’s MRAP (Mine Resistant Ambush Protected vehicles) program. Last year sales jumped 40% after LVT shifted toward modular systems for the detection and suppression of fire in buses, trains, off-road vehicles, mining equipment, oil and gas platforms, and industrial kitchens.

In its nascent years the firm sold agricultural equipment to the developing world, but even before the 1979 Iranian Revolution stripped it of its largest export market, it began to diversify into other industries.

Lehavot, as it is known in Israel, dominated the domestic portable fire extinguisher market until the 1990s. But it wasn’t enough to support its owners’ communal lifestyle, and in 2000 the members of Lehavot Habashan voted to follow the path of many other kibbutzim into full privatization.

“People began to work outside of the kibbutz and earn nice salaries, and they didn’t like having to split their wage,” LVT Sales Director and lifelong Lehavot Habashan resident Misha Goldemberg recalls. “If you lived here but you wanted to visit family abroad, the kibbutz would tell you to wait in line. This flowed into every aspect of life, such as buying a car, and people didn’t want to hear about it.”

Had they held out for just a few more years, Lehavot Habashan might have survived in its original form. Instead, with encouragement from the Israel Defense Forces, LVT branched out into fire suppression systems. Work on the U.S. MRAP vehicles helped LVT hit record sales of $20 million in 2008, but like neighboring kibbutz company Plasan Sasa, with which it collaborated on the MRAPs, American defense budget cuts forced LVT to again reinvent itself. Company sales plunged in 2009-11, before regaining stride in 2012.

Now, with assistance from the Office of the Chief Scientist, which oversees all Israeli government support for R&D, LVT is investing millions in innovations such as the N2 Inert Gas Generator. Developed in cooperation with a Canadian partner, the N2 offers a high-speed, environmentally friendly, nitrogen-based fire suppression solution which releases gas directly from the canister. The product is designed for safe use in confined spaces such as crew compartments, control rooms, and engine bays.

It’s also started developing linear detectors that are designed to operate in harsh environments such as engine compartments in vehicles and boiler rooms in which a regular system would be unable to detect fire.

LTV’s technologies are more advanced than ever, but its operations still take place in the same no-frills, minimalistic factory building as before. Lehavot Habashan Secretary Yori Kandel has fond recollections of his time working in the factory during high school and again at age 21 following his IDF service.

“Before privatization, we educated children not to be afraid of work. We knew how to get up early in the morning to milk the cows,” he says. “After school finished, at about 1 o’clock, each child would have a place to work. Some worked with the younger kids, some with the cattle, some in the dining room--although that has now closed--and others in the factory.”

Kandel no longer works at LVT, but he acknowledges that Lehavot Habashan “cannot survive” without it. In addition to providing full employment for 10% of the kibbutz’s 150 members (the total on-site workforce numbers 70), the company also pays the pensions of all its senior citizens--the same people who, in effect, are the owners.

“Pensioners still come to the factory each day to work for four hours, six hours, as much as they can. If they quit or go home early, that’s up to them; the kibbutz gives them work even if we don’t need them that much. It’s a part of our DNA--it’s better for them, it’s better for us.”

In some ways, the company’s success has allowed Lehavot Habashan to maintain something of a communal lifestyle, even though it no longer upholds the kibbutz movement’s original ideals. LVT paid kibbutz members dividends on one occasion, but it also financed the construction of most of its non-residential buildings, including a concert hall and facilities for social gatherings.

With such a strong connection between company and kibbutz, one would expect this to be a challenging environment for an outsider. CEO Nir Kinori, a native Jerusalemite, admits that being in charge of a kibbutz company is unique, giving the example that he can sit down for a discussion with an employee in the morning, and then find himself sitting opposite that same person in the afternoon when he meets with the company owners. The other major difference is that the kibbutz assembly must approve all company decisions, but Kinori says that none of the board’s directives have been rejected in the 18 months since he joined.

Ultimately, he says, the relationship strengthens the company: “One advantage of being part of a kibbutz is that there are veteran workers who have been with the firm for 25-30 years. This means plenty of knowledge stays within company. If you want to know about something that happened 10 years ago, you don’t need to search in the archives, you just ask them.”

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2 Comments

  • Mark A Carbone

    This isn't a socialist business.  Misleading that you titled it that.  Great company and you did con me into thinking you were promoting socialism so I had to read it to see if it was BS propaganda against free trade and free markets.  I liked the article though :)

    Note - Communal living is not socialism.  It's communal living.  Dah.  Socialism, if you go to Wikipedia or any economics or history book is a baseline of communism and Nazism.  Nazism is also called National Socialism.  

    OK, off my soapbox. 

  • Bablo

    No matter what the Nazis may have called themselves, their ideology had nothing to do with socialism.  Get educated and stop spreading that American conservative lie, please.