Shipbuilding resurfaces in Western Pa. with Campbell Transportation's tugboats
Campbell Transportation Co. has relied on coal delivery as its bread and butter for years, but two names — Renee Lynn and Alice Jean — are about to help it carve out a new path.
Pushing to diversify beyond a market hurt by cheap natural gas and rising costs, the company has turned to boat building. The Renee Lynn and the Alice Jean are symbolic. They are the first tugboats built locally in a generation and mark the public debut of a totally new Campbell.
Campbell officials plan to show off the tugboats at a big party on the North Shore on Tuesday. The christening of the boats, an invitation-only event for political and business partners, will be a culmination for a company that's now nearly doubled revenue in seven years, according to Pete Stephaich, chairman and CEO.
“We're actually very different,” Stephaich said, adding the company has changed management, and its accounting and operational systems. “In hard times you've got to work harder and differentiate yourself as a service provider. You try to do what you do better in hard times. Not that you don't in good times, but you have to try to differentiate yourself somehow.”
As coal declined, the Houston, Washington County-based company started to look for ways to transform its business. It bought an environmental services company two years ago. And it expanded its geographical footprint, shipping coal all the way to the Mississippi River. Now, instead of just running a fleet of towboats, it is building them.
Stephaich said the company is profitable but declined to cite any specific figures. Campbell is privately held, owned by his family for 40 years.
Others in the industry view the Renee Lynn and the Alice Jean as hopeful symbols. The recession hurt, but work has been steady since, said Michael Somales, a general manager for operations and logistics at Consol Energy Inc., Campbell's biggest competitor. Some power plants are closing or using less coal, but others are spending hundreds of millions for environmental upgrades, meaning there could be more work for more boats, said James McCarville, executive director of the Port of Pittsburgh Commission.
“We look at Campbell getting aback in the boat building business as a very good sign for the health of our industry,” he said.
Competition is stiff, but nearly all of the river shippers work together, they said. Consol's towboat, Mathies, is sitting in Campbell's dock in Dunlevy, Washington County, right now, amidst a complete overhaul that should last eight to nine months, said Dan Lacek, Campbell's director of operations on the Monongahela. They often swap overflow work, too, common among most of the local tow companies, Somales said.
“It's a small industry and everybody knows everybody,” he said. “They have to meet a very high standard to work with Consol.”
One of their joint projects is working through the commission and other groups to push for a $1.7 billion federal upgrade for the region's struggling lock-and-dam system. That work is stalled, hampering deliveries all over Western Pennsylvania, but it's allowed Campbell and Consol to excel working a system often too small for national carriers to bother with, McCarville said.
Campbell's expansion and diversification would put it in line with many of the national companies that work the rivers, Somales said. It is an exciting time to work for the company, said Lacek, who left the Gateway Clipper Fleet after 26 years to work for a growing company.
The company now has eight to 10 boats running every day between Pittsburgh and Cairo, Ill., where the Ohio River ends, Stephaich said. Two years ago, it bought an environmental services company, and it does barge and tank cleaning and glycol recycling near Newell at the tip of West Virginia's Northern Panhandle. The company had low debt, and PNC and other lenders were willing to help fund the growth, Stephaich said.
The federal government has, too, with economic stimulus money providing a $600,000 matching grant for equipment the company used to build the new boats, he added. They added 30 workers to help in Dunlevy, where they used the new equipment to laser-cut steel and assemble the boats piece-by-piece in an 11,000-square-foot garage, complete with hanging cranes.
The boats each probably cost nearly $3 million to build, though Campbell officials are still calculating the final costs, Lacek said. The next step is to find a buyer — or someone to order a new boat — and the company has several potential customers invited to the North Shore christening.
“When you're spending these types of dollars, people want what they want. You're trying to guess personalities and what will sell,” he added. “It's exciting. It's a whole new area of opportunity for us.”
Timothy Puko is a staff writer for Trib Total Media. He can be reached at 412-320-7991 or firstname.lastname@example.org.