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On Wall Street there was some speculation that the company might have to declare bankruptcy and then reorganize to avoid some of the damage payments. In 1982 Manville took that controversial route when it was in danger of being overwhelmed by lawsuits related to its manufacture of asbestos. Most of the problems began in World War II, when thousands of shipyard workers were exposed to asbestos. They later developed serious lung diseases and cancer. Manville is now operating under the protection of the bankruptcy laws, and its profits are insulated from legal claims while it tries to negotiate settlements of the suits. Union Carbide has strongly denied that it is even considering filing for bankruptcy.
The Bhopal disaster came as a shock to the chemical industry because Union Carbide is noted for its safety concerns. Said Dan Edwards, director of health and safety for the Oil, Chemical and Atomic Workers International Union: "The large chemical manufacturers have pretty good track records for health and safety, and I'd say Union Carbide is above average." Said Hugh Kaufman, a hazardous-waste specialist at the Environmental Protection Agency: "I'm not surprised that something like this happened, but I am surprised that it was Union Carbide."
Up to now, the company's most publicized environmental problems have involved pollution. In the late 1960s, environmentalists charged that a Union Carbide iron-alloy plant in Alloy, W Va., was "the smokiest factory in the world." Since then, the company has reduced smokestack emissions at its factories and adopted measures to ensure the safe disposal of chemical wastes.
The Bhopal accident is by far the worst crisis ever to face Union Carbide. The company grew out of a firm founded in 1886 that produced the first dry-cell la battery. Union Carbide played a key role in the Manhattan Project, which developed the atomic bomb. Over the years many of the firm's products, including Eveready batteries, Glad bags, Prestone antifreeze and Simoniz car wax, have become popular items in America's households. But the company's best customers are businesses. Major products include polyethylene and other petrochemicals, industrial gases like acetylene and argon, and pesticides. Such industrial lines accounted for 79% of sales in 1983.
Last week's tragedy was a personal trauma for Union Carbide Chairman Warren Anderson, who has spent 39 years at the company. A graduate of Colgate, where he was a chemistry major and a football letterman, Anderson joined Union Carbide in 1945 as a salesman and moved steadily up the ranks to the chairmanship in 1982. Employees last week admired the way he rushed to India after the accident, even though he knew that he would surely face trouble as soon as he stepped off the airplane. Anderson has been trying to give new momentum to a company that is still reeling from the 1981-82 recession and a worldwide glut of petrochemicals. Annual profits reached a peak of $890 million in 1980, but fell by 91% to $79 million in 1983. The price of Union Carbide's stock had dropped from a peak of 74 in 1983 to 49 before the accident.
A comeback will be all the more difficult after Bhopal. Said one Wall Street analyst: "In cases like this, a company's stock goes into a tunnel and does not come out for a number of years."