ROBERT SIEGEL, HOST:
We hear a lot about the desirability of American manufacturing jobs and green jobs. President Obama talks about both very often.
PRESIDENT BARACK OBAMA: We have doubled our use of renewable energy and thousands of Americans have jobs today building wind turbines and long-lasting batteries.
SIEGEL: Well, last week, I visited a Massachusetts factory that doesn't build wind turbines or batteries, but it does make a product that is arguably a force for sustainability. Nearly 40 Americans assemble that product and it's an interesting case study in innovation. It's a hand dryer. It's made by Excel Dryer of East Longmeadow, Massachusetts, a company that Denis Gagnon bought in the 1990s. By 1997, Gagnon knew that Excel had a problem.
DENIS GAGNON: We had an experienced and dedicated workforce. We built a quality product. We had an excellent reputation for customer service and we had a product that people hated to use.
SIEGEL: Drying your hands took 35 to 40 seconds. By that time, lots of people with wet hands had either wiped them on their clothes or grabbed a paper towel. Well, luckily for Gagnon, a firm called Invent Resources promised a marriage made if not in heaven, at least within Massachusetts.
RICHARD PAVELLE: We called ourselves Invention Upon Demand.
SIEGEL: Richard Pavelle was one of four scientists, three of them out of MIT, men who had done serious physics and applied mathematics who would work with companies on ideas for new products, all kinds of products. By the '90s, Pavelle had patented a putter with a big sweet spot. His idea for a hair dryer that blew dry air had failed to win over Conair. So he had a related idea, a dry air hand dryer.
PAVELLE: It's clear that the use of very dry air can absorb more moisture than the ambient air. And the use of shaped nozzles to better focus an air stream can help in the drying of hands and use in...
SIEGEL: Pavelle, the scientist-turned-inventor, phoned Gagnon, the entrepreneur.
GAGNON: It was clear in my mind that the hand dryer of the 21st century better dry your hands quickly. And if they could figure out a way to get there, I was all for proceeding.
SIEGEL: Mind you, Richard Pavelle and his colleagues had already run their idea for a faster hand dryer past World Dryer, which was the colossus in the field, the GM of hand dryers, and they'd been rejected. But when they invited Denis Gagnon to a brainstorming session, the Excel owner accepted.
GAGNON: And they would be at one after another at the chalkboard screaming at each other in Yiddish and arguing how to design this or do that. And just left there thinking, you know what? These guys are probably smart enough to help us figure out a way to do this.
SIEGEL: The scientists determined that the old hand dryers wasted 90 percent of the energy going into them. A new hand dryer had to be more efficient. Excel's own Tom Koetsch went to the milling machine and cut prototype after prototype. Richard Pavelle recalls that the problem was balancing the unbearable noise of the machine against its drying power.
How fast could you dry your hands with a machine that didn't make you flee the washroom deafened by the experience?
PAVELLE: We were shooting for 10 seconds.
SIEGEL: Ten seconds to dry your hands.
PAVELLE: That was our goal. I don't think we ever achieved that goal, but we got down to certainly under 15 seconds.
SIEGEL: After three and a half years, Excel got it down to 12 seconds. Denis Gagnon had borrowed against his home and his life insurance, from associates and relatives. He was tapped out at the bank. But his risk had paid off. His company had a revolutionary machine in the works, the Xlerator, which Excel took to trade shows.
GAGNON: Literally, I had to coax people out of the aisles to come try our hand dryers. I hate hand dryers. Why do I want to try your stupid hand dryer for? So we'd get them up to the Xlerator and they'd put their hands under and you could see the expression in their face. There was a real wow factor to it. It's like, oh, this works.
SIEGEL: It may still have been loud, but it actually dried your hands. Gagnon says sales for the family-owned company have gone up more than 10 percent every year for the past decade. In East Longmeadow, 38 people assemble the dryers in a remarkably un-automated plant.
GAGNON: What we're doing here, we're making our optic sensor.
SIEGEL: The circuit boards are attached by workers armed with power screwdrivers. Denis Gagnon says the components and machinery they use are to the greatest extent possible American.
Today, Excel competes with other hand dryer manufacturers. Dyson, the British vacuum cleaner company, followed Excel with the Airblade. That's the dryer that you dip your hands into. World Dryer eventually came out with its own high-speed hand dryer. And there are others. But the real competition remains, paper towels.
George Campbell, who used to work for Dyson, now sells hand dryers of all brands through his Chicago company NetDryers. Using government data, they tried to measure the potential market for hand dryers.
GEORGE CAMPBELL: And we came up with a number that there's roughly 30 million bathrooms away from home in the United States - ballpark, give or take. Paper towels alone, without hand dryers, are probably in around 90 to 95 percent of those bathrooms.
SIEGEL: That would mean that there are well over 25 million bathrooms that are potential hand dryer installations. The argument for the product is twofold, as Campbell tells it. First, it's cheap. Hand dryers are low maintenance machines and they don't require someone to stock clean towels and cart away used ones. An Xlerator is especially cheap; the basic model costs all of $400.
Second is the sustainability argument. That 12 seconds of drying time uses some electricity. But Campbell quotes research from MIT - research the Dyson actually commissioned - that makes paper towels out to be the real energy guzzlers.
CAMPBELL: If you measure the weight of the carbon it takes to make the paper - manufacture it, deliver it with the vehicles back and forth, dispose of it by vehicles back and forth - the actual weight of the carbon footprint of a paper towel is four times the weight of the towel itself.
SIEGEL: So, the hand dryer makers claimed to be the rare manufacturers who are both green and cheap. And they have big designs on what Campbell calls The Bathroom Away From Home.
Back at Excel's plant in Massachusetts, Denis Gagnon's son, and Excel Vice President Bill Gagnon, treated me to a glimpse of the future.
BILL GAGNON: OK. Well, you're going to see something that not a lot of people have seen back here.
SIEGEL: In their R&D room, there's a model of the sink that made its debut before Christmas. It's in the ladies' room near the shoe department of the flagship Macy's in Manhattan. It's a trough. And at each position there are what appeared to be three nozzles. Put your hands under the one on the left and a sensor dispenses soap. The one in the middle dispenses water the same way. And on the right is the nozzle of the Xlerator, the rest of it is tucked underneath out of sight
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GAGNON: So you get a personalized, proper hand washing without having to move.
SIEGEL: There are some who argue against hand dryers. The paper towel industry points to studies that find that they blow germs around. The hand dryer people cite a Mayo Clinic study that suggests the question of germs is answered by how you wash, not how you dry.
As I asked Campbell, there's also the fact that when I spilled coffee on my desk, I can't say: Help, bring me the hand dryer. And Campbell told me what he says he tells prospective buyers of higher dryers.
GAGNON: They don't open a door, shut a sink, clean your face, dry a spill. They're had dryers. That's what they do. They're now doing it well. And they're doing it with low energy, and they're doing it in a way that people - a lot of people do enjoy.
SIEGEL: So here's a question about hand dryers. If an American entrepreneur, an American shop of inventors, and a skilled American workforce can think up and manufacture a very successful appliance - one that is globally competitive, by the way. Excel says it has 800 Xlerators at London's Heathrow airport alone. Why is it that the motor inside the Xlerator, perhaps not the brains, but the guts of the thing is made in Asia?
We'll address that question tomorrow.
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