With the advent of the automobile and of electric railroad transporta on, the E.B. & R.'s business dropped and opera ons were discon nued in 1928. Bion's son, Robert M. Arnold, previously at M.I.T., was then working at the Grigsby Grunow in Chicago. In 1934, Robert M. Arnold returned from England where he had done exploratory work on permanent magne c materials for Philco, and started ac vely working for his father's company. One of his first assignments was to develop permanent magnets for the Pe bone-Mulliken Company in Chicago. A er one year of developmental work, Pe bone-Mulliken decided not to enter the magne c field. And so, with assistance and permission from his father, Robert M. Arnold started his own permanent magnet produc on at the former E.B. & R. Railroad genera ng and repair depot located in Marengo, Illinois, the present site of the company's largest plant. His produc on was Alnico permanent magnets and was licensed under a patent held by the General Electric Company. These first marketed products were used primarily in radio loudspeakers. In December of 1936, Robert M. Arnold bought the equipment of the auc oned Kinite Company, a foundry in Sheboygan Falls, and moved produc on from the Marengo plant. Ini al manufacturing started in Sheboygan Falls with only five employees. Early Alnico Manufacturing P 3 Robert M. Arnold