Austal's LCS finally left port for her builders trials on Thursday morning but came back in on Friday, the party line being that they wanted to give everybody involved the weekend off before starting again on Monday.  The trials had been delayed by problems with her machinery control system software, something that seems to be becoming a chronic problem with the Navy's ships.  July 3, 2009.

Yesterday Bender voluntarily sought conversion of the Chapter VII filing to Chapter XI and got permission to use money borrowed from Marquette Commercial Finance to meet its payroll.  Reads the filing here.  An attachment to this filing indicates that the company projects revenues of $1,195,516 over the next two weeks and disbursements of $1,405,871.  In addition, Tom Bender apparently lent the company $330,428 this week.  July 2, 2009.

The Census Bureau has released some of the data from the 2007 Economic Census and it clearly shows the boom we have been experiencing.  Look at the data here.  (Note that the Economic Census is done in years that end in 2 and 7: the additional data come from the Annual Survey of Manufacturing.)  The total revenues of the industry in 2007 were $16.3 billion, compared to $14.9 billion in 2006, an increase of 10%.  Of this, shipbuilding grew by more than 14%, while ship repair didn't change at all.  Note also that revenues in boatbuilding turned down in 2005.  July 1, 2009.

We've seen this coming and here it is.  Read the announcement here.  If anyone doesn't understand that this is going to be the big technological challenge for our industry over the next few years, they haven't been paying attention.  This could make compliance with OPA90 look simple.  But remember, what they make us do, they had better make the truck and car and train and airplane guys do as well.  Start planning your LNG-fuelled ships.  July 1, 2009.

The other shoe finally dropped.  Bender Shipbuilding said this morning that it has agreed to seek protection from its creditors, filing a Chapter 11 bankruptcy petition to reorganize the business.  Sad, but not surprising.  Read the report in the Mobile Press-Register here: don't miss the nasty comments that follow.  July 1, 2009.

Strange scheduling that must have stretched the Navy's INSURV resources saw simultaneous "Super Trials" this week of DDG 105 at NGSB and DDG 108 at BIW.  In a reversal of expectations, however, the NGSB ship apparently performed well while the BIW ship didn't.  Read the Defense News report on DDG 108 here and the NGSB release on DDG 105 here.  Insiders report, however, that the DDG 105 trial was not as smooth as the release implies and you note that there is no reference to any broom at the masthead.  In addition, DDG 105 was supposed to have been delivered in June last year, whereas DDG 108 was only supposed to have been delivered in February this year.  July 1, 2009.  Correction: I am advised, with a confirming photograph, that DDG 105 was, in fact, flying a broom from her masthead on her return to the yard.  Good for NGSB.  July 2, 2009.

LCS 2 did not go out on builders' trials on Monday, because of machinery problems.  And it did not go out on builders' trials yesterday either, for unspecified reasons.  And GD will no longer be providing any “interim updates”, that is to say "enough with the questions and trust us."  July 1, 2009.

Some of the snowbirds are still down here on the beach.  Check out the tan on this guy as he heads to the local saloon for some flipper pie and a Labatt 50.  By the way, this gentlemen - his name is Mitch - is a beach moose.  The beach moose has very different behavioral characteristics compared to your common or forest moose.  Whereas the forest moose just nibbles on greenery, complains a lot and finds his entertainment in trying to stare down oncoming traffic, your beach moose enjoys fish and pasta, is very gregarious and plays a mean game of beach volleyball.  July 1, 2009.

Military Sealift Command is asking about the cost and availability of providing two US-flag HSVs, with delivery of both vessels in October of this year.  Read the request for information here.  I think I know of a couple that just might be available.  June 30, 2009.

Last week, Seacor filed suit in the Bankruptcy Court in Alabama, claiming that Bender defaulted on its contract to build six offshore service vessels and now needs to pay up on the $5 million letter of credit issued by RegionsBank, which was effectively its performance bond.  Today, the judge ruled for Seacor.   June 29, 2009.

Harry Fiegel died last week, at the age of 73.  Read the report in Galveston County's Daily News here.  Harry was a remarkable shipbuilder.  He started out at Todd Houston but became President of Galveston Shipbuilding while still in his 20s and was the only shipbuilder to build double-hull tank barges before they were required.  One can only imagine how successful he might have been if he had been running a shipyard in some place other than Galveston.  June 29, 2009.

OSG America has sold one of the few tank barges that were built with double hulls before OPA 90 was ever dreamt of.  The OSG 300 was built by Galveston Shipbuilding in 1979 as Belcher 101: she was one of the barges that OSG used in lightering service in Delaware Bay and will be replaced by one of the two ex-Bender newbuildings.  Now she is the Bamidele and is in service in Nigeria.  Marcon, who recently celebrated their one thousandth sale, were the brokers.  June 27, 2009.

The Mobile Register's intrepid shipyard watcher reports that LCS 2 is scheduled for Builders Trials on Monday, June 29.  Read the story here.  Nothing on this from any of the official sources, as usual.  Unofficial sources confirm that LCS 2 will attempt to go to sea on Monday, but are not optimistic that anything useful will be achieved.  The biggest problem is apparently the machinery control system, manufactured by GD but never before installed on a ship.  June 25/26, 2009.

In addition to Austal's LCS, NGSB will have DDG 105 and LPD 21 on sea trials next week   Hey, NAVSEA, no unnecessary secrecy now: the taxpayers want to know how these trials go.  June 26, 2009.

Rowan has announced that its rigbuilding subsidiary, Le Tourneau Technologies, will restart work on the third of the four 240-C jack-ups, which had been suspended last year.  Read the announcement here.  June 26, 2009.

Ashland Oil has sold its marine services subsidiary, Drew Marine, to J. F. Lehman & Co., for $120 million.  Read the announcement here.  June 24, 2009.

The Navy has exercised an option with Northrop Grumman to provide almost $214 million for LLTM for LPD 26, which will, with luck, be the last of the San Antonio class.  Read the DefenseLink announcement here.  The Navy has spent $8.8 billion so far on these ten doubtfully useful ships: there's probably about another billion to go, for an average shipyard cost of close to $1 billion per ship.  The Austin class, which this class replaces, cost about $25 million each in the mid 1960s: let's see now, $25 million inflated at 4% a year for 40 years equals about $120 million and the new ships are averaging about $1 billion.  Yes, I know that the new ships are much more capable, but really, isn't this a bit out of proportion?  Aren't they just transports for marines?  Funny how you don't hear U.S. Rep. Gene Taylor railing away about this program.  June 23, 2009.

The satellite launch company that is owned by Boeing (40%), RSC-Energia of Russia (25%), Aker of Norway (20%) and SDO Yuzhnoye of Ukraine (15%); is based in Long Beach - see picture at right; and operates a modified Russian-built semi-submersible as a launch platform in the South Pacific and supports it with a special-purpose Scottish-built command ship, is bust.  Read the announcement here.  June 23, 2009.

Washington State Ferries has sold their four fine old electric ferries again, this time to Eco Planet Recycling, a California company with the ultimately PC name.  Read the announcement here.  The price is $200,000 for the four, which is essentially a case of "please come and take them away".  June 23, 2009.

MARAD has sold the ammunition ship Suribachi (AE 21) for scrap.  Read the announcement here.  She was built at Sparrows Point in 1956, one of a class of five.  June 23, 2009.

Signal International has signed a contract to build a 300-foot by 100-foot oceangoing deck barge for Signet Maritime.  The barge will be built at Signal's high-productivity Orange shipyard and delivered in the first quarter of next year, i.e., within nine months.  Read the announcement here.  They must have been reading our market study.  June 23, 2009.

The fine old liner Independence has finally shown up off Dubai - see the picture at the right.  No news yet of where she's going to end up.  June 23, 2009.

The West Australian reports that the bankruptcy of Hawaii Super Ferry means that Austal will take an $11 million hit to its bottom line this year, as well as having to write off the balance of HSF's debt.  Read the report here.  It appears that there is now no possibility of a rescue of HSF, which is no surprise.  If there is no restructuring and HSF has defaulted on its Title XI bonds, then MARAD gets the boats.  Austal is screwed: the only way that Austal would get any money at all is if MARAD can resell the boats for more than the cost of paying off the bondholders.  That's not too likely.  The only real question now is what MARAD will do with the two boats and the obvious answer would be charter them to the Navy, except that the Navy doesn't yet have authorization for them.  June 22/23, 2009.

Marine Log reports that the Louisiana Board of Ethics has ruled that North American Shipbuilding, which is owned by Chouest family interests, is not eligible to build a new floating dry dock for the Port of Terrebonne, for use by LA Ship, the new shipyard being developed in Houma by Chouest family interests.  Read the story here.  Apart from the startling discovery that Louisiana actually has a Board of Ethics, it's curious that the Port of Terrebonne, the Louisiana DoT and the other investors are still supporting this project when small shipyards are laying people off and/or closing all around them.  Wake up, guys: we need fewer, not more, shipyards.  June 18, 2009.

The Supreme Court has ruled for Polar Tankers over the City of Valdez in a dispute over the constitutionality of the City's proposed tonnage tax, which is specifically crafted to apply only to crude carriers.  Read the opinion here.  The Supremes agreed with Polar that it violated Section 10 of Article 1 of the Constitution, the last paragraph of which says "No state shall, without the consent of Congress, lay any duty of tonnage, keep troops, or ships of war in time of peace, enter into any agreement or compact with another state, or with a foreign power, or engage in war, unless actually invaded, or in such imminent danger as will not admit of delay."  Who knew that the Constitution said that?  (Well of course lots of lawyers did but I mean normal people.)  The rest of that section is kinda interesting, too.  Don't states do some of those things all the time?  June 15, 2009.

The popular naval architect, former Sea-Land executive and founder of U.S. Ship Management died on Friday, after a long illness.  He was only 67.  Read the obituary in the Journal of Commerce here.  June 15, 2009.

According to the Military Officers Association of America's web site - read it here - the dreaded Lockheed Martin is claiming that the Navy is in a rush to deploy LCS 1 now, presumably for anti-piracy operations (what else?).  Well fine, as long as she doesn't get too far from the repair yard in Bahrain and she has an oiler following her around day and night.  What BS!  June 13, 3009.

Every time there's discussion of new curbs on tobacco production/sales/use, as at present, we are reminded of the Surgeon-General's report of 1964, as if nobody had any idea of the dangers before that.  Well, duh, as they say.  The use of tobacco by anybody other than native Americans dates to about 1585, when "Nutty Walt" Raleigh took it back to England and demonstrated its use.  (Remember that wonderful Bob Newhart routine?)  In 1604, only 19 years later, King James VI and I, who was famous for being a better scientist than monarch, wrote and published "A Counterblaste to Tobacco".  Click on the title page on the right to read it.  We have known of the dangers for over 400 years.  June 13, 2009.

Aker Philadelphia Shipyard delivered the seventh of its series of 12 product carriers - the Overseas Nikiski - on the same day that NASSCO delivered the second of its truncated series of five - the Pelican State.  It's interesting to look at the improvement in construction times: see the table below, in which the figures in the six right-hand columns are in weeks.  (It would be even more interesting to look at the improvement in manhours, but they won't share those numbers with me, for some strange reason.)  June 12, 2009.

The U.S. Court of Appeals for the Second Circuit has reversed the federal court's dismissal of the case brought by Spain against ABS, in which they alleged that ABS was at fault in the loss of the Prestige.  Read the ruling here.  June 12, 2009.

A major business activity down here in bizarro-world is landscape maintenance.  All those McMansions have to be kept flawlessly trim, regardless of whether anyone is actually in residence.  And then there are all those hundreds of square miles of walled and gated retirement ghettos.  The typical landscape contractor is a guy with a pick-up, a trailer and two non-English-speaking laborers.  There are hundreds, if not thousands, of these outfits, all doing the same thing and all competing with each other.  What kind of a messed-up business model is that?  Here's a situation where a co-operative would really work.  Ten or twenty or so of these guys should get together and centralize all the tasks that they themselves don't need to be doing, such as bookkeeping, scheduling, dispatching, purchasing, warehousing, equipment maintenance, sales and marketing.  They would be so much more efficient than the independent operators.  When I get through rounding up the Burmese pythons, I think I'll give it a try.  June 11, 2009.

The rumor mill says that Blackstone has selected Crowley to operate the five product carriers being built by NASSCO.  Six companies were being considered, including at least two that are not currently engaged in the Jones Act products trades.  Maybe there will be an announcement when they take delivery of the second, the Pelican State, later today.  June 11, 2009.

The three are Gulfmark Offshore, Louisiana Machinery and Sirius Technical Services.  Read the filing here.  Read the report in the Mobile Press-Register here.  Bender is objecting but then they would, wouldn't they?  Read their response here.  I say they are a goner: let's get a new owner with some working capital in there as quickly as possible.   I can think of at least three shipbuilders and three operators, any one of whom could take over tomorrow and make that place hum.  June 11, 2009.

Taking a page from the Chouest book, Bollinger Shipyards has formed an operating subsidiary called Bee Mar LLC.  Bee Mar will be managed by industry veteran Van DeWitt and based in Houston, with an operations center in Lafayette.  It will start off with the five 210-foot and three 234-foot PSVs that Bollinger has been building on spec, an investment of over $200 million.  The first two of these - Busy Bee (seen on the right) and Worker Bee - are now ready for service.  Crafty old Boysie Bee.  June 10, 2009.

VT Halter Marine has delivered the third of four Fisheries Research Vessels, the Pisces, to NOAA.  See picture of her being launched at right.  Read NOAA's announcement here.  June 9, 2009.

Tradewinds reports that Blackstone Group has succeeded in forcing U.S. Shipping Partners out of the partnership that owns, or will own, the five product carriers being built by NASSCO.  US Shipping's Chairman, Ron O'Kelley, formerly of Refco, is quoted as follows: "Blackstone Group has succeeded in pirating away our equity investment of $70m," he said, referring to the legal processes the private equity firm used to wrest control of the venture."  US Shipping will remain construction manager: O'Kelley, a man with no maritime background and clearly an individual with little grasp on reality, is also quoted as saying: "We've done an outstanding job.  Under our construction supervision, the Golden State and the Pelican State (pictured at right) were both delivered under budget and also early."   Of course, the shipyard had nothing to do with it.  June 9, 2009.

PROGRESS ON LCS 2

The Navy Times reports that Austal USA has successfully fired up the main propulsion plant on LCS 2, the future USS Independence.  She should be ready for trials soon.  Read the story here.  June 9, 2009.  Other sources say, however, that this report overstates the situation and that what they did falls far short of a proper dock trial: we shall see.  OK, here's the proper story.  Dock trials next.

This is not an analogy that had ever occurred to me, but maybe my outlook is too narrow.  In an article headed "GM Is Sunk: Just Ask the U.S. Merchant Marine", Richard K. Bank, who was director of the State Department's Office of Maritime Affairs in the Nixon-Ford-Carter years, says, among other things, that "along with less-than-stellar management, union demands for ever-higher wages and excess manning levels -- such as insisting on crews of 35 or 40 when crews of 18 are sufficient to operate safely -- doomed the U.S. flag".  Read the whole thing, which appeared in Sunday's Washington Post, here.  June 6, 2009.

Maersk Line Limited, the US-flag, foreign-trade carrier, has announced the replacement of nine ships.  The nine ships to be flagged in have an average capacity of about 4000 TEU and an average age of about 10 years, while the nine ships they replace have an average capacity of about 3400 TEU and an average age of 23 years.  Read the announcement here.  Good for Maersk, although I pine for the pre-Reagan days when foreign-trade ships had to be US-built.  Click here to see the US-flag fleet of containerships and other general cargo ships: note that the foreign-trade fleet has an overall average age of 12, while the domestic-trade (Jones Act) fleet has an overall average age of 27.  Worldwide, most containerships are scrapped before they are 25.  Isn't competition wonderful?  June 5, 2009.

The company's new President warned on Monday that a dip in the shipyard's workload meant that there would soon be layoffs.  Read the report in the Portland Press Herald here.  June 3, 2009.

The Lockheed Martin whistleblower, Michael DeKort, has filed a false claims suit against Integrated Coast Guard Systems.  Read the story here.  June 3, 2009.

I just heard an intelligent, educated person on NPR pronounce the word "fêted" to rhyme with pedal extremities rather than with Kismet.  Don't they teach anything in U.S. schools?  Good grief!  June 1, 2009.

Sometimes I think I haven't been paying attention.  I have just discovered what many of you probably already knew.  There's a company called National Shipping of America, - visit them here - that is based in San Francisco and has acquired a 20-year-old Polish-built cargo ship, the National Glory, that they are planning to put in Jones Act service between Freeport TX and Chester PA.   (Chester PA?  That would be Penn Terminals, no doubt, the best little terminal in the country.)  She qualifies under Section 12112(b)(ii), because she was seized by the U.S. Government in a drug bust and sold at auction.  Personally, I think this is great and wish them well.  It's a start.  It makes a lot more sense than building a whole lot of new ships.  That will come.  June 1, 2009, corrected June 3.

How will Atlantic Marine Alabama launch the American Heavy Lift tankers without breaching the Jones Act?  Their launching system involves transferring the ship from land to the dry-dock and then moving the dry-dock out into deep water before lowering it to allow the new ship to float free.  But their dry-dock was foreign-built and that move from dockside to deep water is a Jones Act voyage.  I know this sounds crazy but it is: we've been down this particular path before.  Watch for the competition to stir things up.  June 1, 2009.