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Home / Washington Business - March/April 2007 / Made in Washington: Trying to keep manufacturing alive |
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Made in Washington: Trying to keep manufacturing alive |
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Written On: March/April 2007 |
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Written By: by Shawn Sullivan |
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Back in 1992, commercial fishing was still a viable industry in Washington when a small engineering company that specialized in designing commercial winch systems for fishermen was flourishing. A few years later the fishing industry hit the skids, leaving Hydra-Pro in the position of owning an increasing share of a diminishing market.
The declining number of commercial fishing boats forced Hydra-Pro to find a new way to survive. "We started to move into hydraulic system engineering design and installation," said Hydra-Pro President Ed Ramberg. Shortly after this transition, the company once again faced a dwindling market and had to find another way to stay competitive. "In 1998, we transformed our company into a small manufacturer of marine cranes," Ramberg said.
Today, Hydra-Pro designs and manufactures cranes for a wide range of marine applications, from specialized cranes for fuel delivery barges to equipment capable of withstanding the harsh conditions of Alaska’s Bering Sea fisheries. Every part—down to the smallest ball bearing—is manufactured in Hydra-Pro’s on-site machine shop.
Making the transition from design to manufacturing may seem like a daunting task, but Hydra-Pro did it in less than a year, with its first crane delivered in June 1998. Seven years later, Hydra-Pro has a reputation for building the highest-quality marine cranes in the Pacific Northwest. "We have moved away from the fishing industry and now make cranes for offshore platforms, diving and research boats, and oceanographic vessels," Ramberg said.
Hydra-Pro employs 30 people and produces about 40 cranes every year. Their cranes are exported to almost every country in the world, and there is currently a one-year waiting for order fulfillment. "Our goal is to double our output within the next few years," Ramberg said.
In an effort to attract more clients and reach that goal, Hydra-Pro has applied to the International Organization for Standardization for ISO 9001:2000 certification. "We get certified in May or June of this year, which will open another door for us," said Ramberg. Several international companies—potential clients, and large ones—have policies prohibiting them from purchasing cranes from uncertified manufacturers.
Despite the company’s success, it faces yet another crisis in its future—Seattle’s desire to push manufacturers out of town. "Seattle’s tax revenues from condos and office space are much higher than manufacturing," Ramberg said. "Between Seattle’s real estate taxes and the cost of treating surface runoff of rain, our overhead in Seattle is tremendous." Several businesses located on Lake Union’s waterfront have faced a similar fate. Most have moved to places like Kent or Everett, something Hydra-Pro has considered, as well.
"Many companies facing this kind of pressure from the city just throw up their arms and give up," Ramberg said. "At one point, we—like a lot of our competitors—looked into moving our shop to China, but we really want to stay here."
Regardless of what happens in the next couple of years, Ramberg understands the realities of being a manufacturer in Seattle. "We have a couple more profitable years here, and then we will need to move on," he said. "Hopefully, it will be merely south of here, like Kent, but that depends on the cost."
The change from manufacturing to residential and professional office space in the area surrounding Hydra-Pro is already underway. Construction has commenced on a large yacht marina next door. A two-story office complex is moving in on the other side. "I would like to stay in Seattle," Ramberg said. "The problem is that it costs too much."
Another reason Hydra-Pro has considered relocating is the increased cost of housing. "Every year we have to go further and further away to find employees," Ramberg said. "Housing in Seattle is no longer affordable for many people. We have some employees commuting from Arlington and Milton every day."
While housing costs and higher-than-normal overhead have placed heavy burdens on Hydra-Pro’s budget, the upcoming transportation debacle they may face as result of the new Alaskan Way viaduct proposal may the be straw that broke the camel’s back. "We see replacing the viaduct as a possible logistical nightmare," Ramberg said. "I can’t see how we can go on with a construction period of several years. If they decide on the tunnel, we will definitely have to move."
Many manufacturers in the Seattle area have faced similar problems. A great many of them have relocated elsewhere. Manufacturers like Hydra-Pro keep our state’s economy rolling by providing living-wage jobs and benefits to thousands of Washington workers. Unfortunately, the business climate for manufacturers is changing rapidly—it doesn’t have the same appeal that it did 50 years ago.
State and local government should do more to ensure the future of companies like Hydra-Pro, who want to expand and employ more people in Washington. "I don’t think Seattle has the political will to have industry survive in this area," Ramberg said. Let’s hope that state government has the political will to keep manufacturers from leaving the state.
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