Ferry contract revenues fall short for Horizon Shipbuilding

Horizon Shipbuilding, Bayou La Batre, Ala., said today that revenue shortfalls from its big New York ferry project has left it unable to continue “normal” day-to-day operations, according to a statement the shipyard released today. The company did not say it had filed for bankruptcy, but was “reorganizing” its current projects. A chapter 11 bankruptcy filing is frequently referred to as a “reorganization.”

“Last year, Travis R. Short, president of Horizon Shipbuilding saw an opportunity to repeat a great construction performance from 2012, namely, an unheard of quantity of vessels in a very short period of time starting from ground zero,” the company said in a statement. “Hornblower (HNY Ferries) offered just this type of opportunity through its NYC Ferry project and Horizon has achieved what most believed couldn’t be done. Through the unparalleled commitment of Horizon’s boatbuilders, subcontractors and suppliers, all of the 2017 ferries have been delivered. However, project revenues were not sufficient for Horizon to continue normal day to day operations. The forecasted shortfalls were brought to the forefront early in the project and discussions have been ongoing since then without resolution.”

The Hornblower contract involved new 85’4″x26’3″ aluminum catamaran ferries for New York’s Citywide Ferry Service (now known as NYC Ferry). Designed by Incat Crowther, the new high-speed passenger boats have capacities for 149 passengers (three crew). (Metal Shark in Louisiana is also building ferries for NYC Ferry to this design.)

San Francisco-based Hornblower Cruises & Events’ subsidiary HNY Ferry Fleet LLC is the operator of the new citywide service.

Hornblower's Terry MacRae (left) and Horizon's Travis

Hornblower’s Terry MacRae (left) and Horizon’s Travis Short. Ken Hocke photo

Terry MacRae, Hornblower’s chairman & CEO, said Horizon delivered its initial 10 ferries for 2017 (one of which is still in route waiting for the hurricanes on the East Coast to dissipate). There were options for more in 2018 but those options were not exercised. He would not go into details as to why but said Horizon has been caught in the downturn in the Gulf linked to the depressed oil and gas industry. “I think they’re like many yards in the Gulf, struggling for business,” said MacRae.

As for the relationship between Horizon and Hornblower, MacRae said, “As with all business relationships, adjustments have to be made as you go along, but they have been good to deal with. They are good guys with a talented team around them.” He added that Horizon is a shipyard Hornblower would do business with again if the situation were right.

The New York City Economic Development Corporation, which oversees the NYC Ferry, referred all questions to Hornblower. It was not immediately clear what the situation will mean for plans to upsize three planned ferries to carry 250 passengers, an option city officials have been looking toward in response to the ferries’ success and long lines for passengers, particularly on weekends.

“Horizon will now take the time to reorganize its current projects and make every effort to regain its reputation with the vendors and subcontractors that help make up the Horizon Team,” the shipyard’s statement went on to say. “Horizon appreciates the industry’s support as they meticulously navigate through the process of reestablishing itself as the shipbuilder their customers have come to rely on for the past two decades.”

Last month Horizon delivered the first of a series of new 100’x40′ shipdocking tugs for McAllister Towing, New York. The new tugs are EPA Tier IV vessels powered by twin 3516E Tier IV Caterpillar engines with twin Schottel SRP4000FP units. Packed into the new tug’s hull is 6,770 hp and over 80 metric tons of bollard pull.

WorkBoat reached out to Horizon for additional comments but were unsuccessful.

 

About the author

Workboat Staff

6 Comments

  1. It’s a shame – Horizon is a good yard.
    With so little work these days there is quite literally no money or certainly no real profit to speak of. I’ve been in this business since 1981 and never ever seen it this bad. I

    All we see on the news is Navy, Navy Navy! (which is good) – but small shipbuilders and boat builders are locking up gates and calling it quits.

    Halter got an (Navy) APL handed to them, maybe Horizon, Hilmar, Gulfstream and all the other small to mid size builders could get the same.

    Something has to give!

    Eddie Adler
    DNC of Mobile, Inc.

  2. David you have no idea. My company alone is owed $785,806.45 on this project. There were financial issues early on in this project, yet Hornblower (who I have had a long relationship with) let me dig myself into a hole and never once informed me of the internal financial issues. I’m taking my story to the public. I don’t know how the city can consider their project a success when a small, veteran owned business has been stuck for 3/4 of a million dollars and they are silent. Just wait and see how the mayor responds to this fiasco. I’m working on a billboard that is going to go up just outside of the Brooklyn Navy Yard. I got screwed intentionally on this project. I’m going to make sure everyone knows.

  3. Thomas Reynolds on

    I built the hull structures on those 10 ferries. The company was also plagued with trying to support the labor force when Austal and Northrop Grumman had better money and benifits to be had, finding enough quality first class aluminum shipbuilders posed a major problem. Travis Short is a great guy to work for and I have worked with him on more than one time. I’m sure the company will bounce back and hopefully soon.

  4. Nick there are more people in the situation you’re in. We need a less moderated place to get the truth out to those who care.

Leave A Reply

© Diversified Communications. All rights reserved.