Todd Shipyards Wins Contract From Matson
Todd Shipyards signed a $33-million contract with Matson Navigation Co. on Wednesday to enlarge and renovate a cargo ship, a deal that could save 400 jobs at the shipbuilder’s ailing San Pedro facility, a Todd spokesman said.
Todd, based in New York, expects to begin work next June on the 700-foot Matsonia, said Len M. Thorell, vice president and general manager of the San Pedro shipyard. The ship is scheduled to be delivered to Matson in March, 1987.
“One thing this contract means most assuredly is that our layoffs happily will be able to level off beginning next year, and hopefully we can get some other work along with this,” Thorell said in a telephone interview from San Francisco, where the contract was signed.
Last April, Todd officials predicted that they would have to lay off hundreds of workers at the San Pedro yard after it failed to win a Navy contract to build the first ship in the Arleigh Burke class of destroyers. The contract went to Bath Iron Works, a subsidiary of Congoleum Corp. in Bath, Me. The Navy plans to build 29 of the destroyers by the mid-1990s under a $25-billion program.
Thorell said layoffs in San Pedro, where the work force has been cut by 50% to 2,900 employees since 1983, will continue unless the company wins more contracts in coming months, but the Matson project will provide 400 jobs that otherwise would have been eliminated.
The San Pedro yard is currently completing three Navy missile frigates, known as FFGs. The company, which hopes eventually to snare some of the Arleigh Burke work, is also negotiating with six foreign countries to build a new class of frigate that it has designed itself, Thorell said. He declined to name the countries.
Todd submitted the lowest of seven bids for the Matson project, according to Matson officials, winning out over several East Coast and Gulf of Mexico shipyards. Thorell maintained that the award of the Matson contract to Todd was proof that West Coast shipyards, which generally face higher labor costs than yards in the other areas, can compete successfully.
“We are working smarter in spite of the labor differential,” Thorell said, adding that Todd has spent $130 million since 1978 to modernize its San Pedro facility.
San Francisco-based Matson is a subsidiary of Honolulu-based Alexander & Baldwin Inc., a diversified company with interests in ocean transportation, sugar production and real estate. A spokesman for Matson said the Matsonia contract is part of the company’s continuing program to improve its fleet.
The project involves removing a 291-foot center portion of the ship and replacing it with a 347-foot mid-body. The job, which will triple the vessel’s cargo capacity, also involves reactivating the ship’s power plant. The ship has been sitting idle at Matson’s terminal in Oakland for the past three years because the company considered it uneconomical to operate, compared to its other ships, according to Arthur Haskell, a Matson senior vice president.
