Small ship repairers find orders dwindling

SOS : The small Maryland companies that are vital to the repairing of ships are finding it harder to survive.

August 26, 2002|By Paul Adams | Paul Adams,SUN STAFF

Steve Salmi will go anywhere to fix a ship. The retired Coast Guard naval engineer and his small crew travel up and down the East Coast and throughout the Great Lakes in pursuit of work, mostly aboard Coast Guard vessels.

This year, it has been tough to find. After Sept. 11, the Coast Guard's 232 ships and 1,400 boats became so busy guarding ports from potential terrorist threats that many postponed the kind of minor repair contracts that keep Pasadena-based Salmi and Co. in business.

At the same time, a sluggish economy and other market forces have made this a tough year for small companies that repair shops. They provide a vital service to commercial cargo ships visiting the port of Baltimore and other East Coast ports. In an effort to keep costs low, many ship operators avoid having all but emergency work done in the United States, where skilled labor is more expensive than in other parts of the world.

"There's not as much [work] out there, and they're trying to do more with less," Salmi said, taking a break from repairing fuel valves aboard the Coast Guard cutter Buckthorn, a 100-foot buoy tender stationed at Sault Ste. Marie, Mich.

In coming days, Salmi, 50, and a crew of six will clean and repair the ship's water and fuel tanks, complete galley renovations and finish other repairs while the 38-year-old Buckthorn is in port. It's one of the few Coast Guard contracts he has landed this year.

"They're just running [the ships], and it's going to catch up to them eventually," he said.

Salmi's business has suffered as the Coast Guard's mission has expanded since Sept. 11. In addition to carrying out its usual tasks of intercepting drug smugglers and enforcing fishing regulations, the federal agency has increased inspections of foreign cargo ships entering U.S. ports and is generally keeping an eye out for terrorist threats. The agency is expected to be the centerpiece of the proposed Department of Homeland Security.

"We did have to defer quite a bit of in-port [repair] work because we had to get the cutters under way for homeland security reasons, and that happened up and down the East Coast," said Lt. Don Deibler, who is with the Coast Guard's maintenance and logistics command in Norfolk, Va.

Repair schedules are beginning to return to normal now as the Coast Guard settles into a post-Sept. 11 routine, Deibler said.

Salmi is willing to travel to keep up with demand, as the work gradually returns. It's a transient lifestyle he became accustomed to in the Coast Guard, where his 26-year career took him to Florida, Puerto Rico, California, Michigan, Minnesota and Maryland. He launched the ship repair business in 1997, just a few months after retiring.

"I believe in the Coast Guard and would have stayed there forever," he said.

Salmi and Co. is among a shrinking number of small Maryland companies that repair ships. Most survive by taking on emergency repairs and appealing to a broad audience, including commercial cargo ships and military vessels. Keeping the niche business alive in Baltimore is considered critical to maintaining the city's reputation as a full-service port.

But with the economy tight, the business has fallen off.

"We see the same number of ships moving in [to port], so that's not the problem," said Cary Lynch, vice president of Baltimore's General Ship Repair Corp., a third-generation, family-owned company on Key Highway. "The problem is that routine maintenance seems to be curtailed somewhat."

Much of General Ship's business comes from commercial ships. When a cargo vessel needs emergency repairs, Lynch will dispatch a crew to meet the ship wherever it's unloading.

Such "down river" repairs range from overhauling a motor to repairing an electrical problem. Workers have to be prepared to work at any time of the day or night to keep the ships moving on schedule.

Work for the company and its 40 employees was pretty steady until last spring, Lynch said. That's when he began to notice a decline in certain segments of the business. Tug and barge repair jobs are picking up, while maintenance work aboard large cargo vessels seems to still be lagging.

"I think it's partly because of the economy," he said. Ship owners know that minor maintenance can be postponed when times are tight.

Michael W. Moss of Moss Marine USA Inc. has seen the trend as well. As does General Ship, the small Baltimore company picks up general maintenance work on cargo ships coming into port.

Moss is often called upon to take on emergency repairs after Coast Guard inspectors board a ship and identify equipment problems that could pose a safety threat.

The slowdown in business can be partly attributed to a change in the mix of ships visiting Baltimore.

For example, Moss said his company used to get a lot of work repairing foreign ships that bring sugar to Domino Sugar's processing plant in Baltimore. A bulk commodity, sugar is often transported aboard older, low-budget ships that have a tendency to break down or require unexpected minor repairs. But much of Domino's sugar now arrives from domestic sources and is transported by barge. Repair orders are fewer, Moss said.

"In general, the market is depressed, but we're a small company," he said. "As a small company, we have staying power because our needs are not as great."

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