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Ship ahoy! ...Caridoc reinvents how it does business
Yellow hard-hatted workmen sandblast the starboard of the Hoheriff, 139-metre long cargo ship that’s German owned, but carries the flag of Antigua and Barbuda. Their loud whirring machines create a cloud of dust at the Caribbean Dockyard and Engineering Services Ltd (Caridoc), the operating company of CL Marine, which is 100 per cent-owned subsidiary of CL Financial, according to the conglomerate’s 2007 annual report. As far as Caridoc executive director Grant Taylor is concerned, this is the shipyard showing the best potential to develop T&T’s shipbuilding and repair sector. “I do believe that there is room for shipbuilding in T&T,” said the gentle-eyed, rugged-looking, Carib Rugby Football Club player. “Once we are up and running and we have covered our base, got ship repair and we’ve got our drydock working, we would explore shipbuilding. It is very much a niche market.” Ability is one thing, competing with the likes of Asia’s mammoth shipyards is another. “There is no way anyone here can compete with vessels that are currently built in Asia. It can’t happen. Their steel is cheaper, their workforce is cheaper, their labour is cheaper,” Taylor said, in an interview last Friday at Caridoc’s 26-acre yard at Chaguaramas. “For me to replace a kilogramme of steel, I would charge US$14, US$15. In China, Asia, it’s US$1. That’s the scale of the difference. I’m 1,400 per cent more. That’s the scale of the difference in the steel they can get there and their labour force to do it. You cannot compete with anything they are doing.”
Taylor today wears two hats: he’s project manager for his employer CL Financial, which hired him one year ago to make significant changes to how Caridoc operated. He’s made serious headway in that direction. Asked if Caridoc is a successful, going concern, Taylor replied, with a slight pause: “It is...getting there.”
“When I came in in July last year at the behest of the (CL Financial) board to look at whether or not it could sustain itself, I did a feasibility study and I presented it to the board, that said essentially, yes, it could, but it had to change its thinking.” Prior to Taylor’s arrival, Chase Hart—son of Calder Hart, former executive chairman of the Urban Development Company of T&T—was chief executive officer at CL Marine. Chase Hart left the job in August 2011. Last week, Taylor declined to describe the thinking of the company prior to his arrival, suffice it to say, “It wasn’t what it should be. “What we realised was that we had a 230-metre Panamax-size floating dock facility that was averaging 140 metres on it. “We weren’t utilising, on average, 90 metres of the dock, which is inefficient. We were taking 22 days, 23 days, 25 days, 30 days to do dry dockings, which should take ten days. “There is no incremental income from taking 30 days to do a vessel as opposed to doing ten days. “What it means is rather than doing three vessels in that 30-day period, I’m getting, essentially, triple the amount of money, you’re doing one. And that one wasn’t enough to sustain it. Those were the challenges we knew faced us.
“All of these vessels have to come off charter to come into the dry dock, which means the owner is making no revenue while the vessel is going through repair,” said Taylor, sitting in Caridoc’s air-conditioned boardroom, a sharp contrast to the sweltering heat and dust of the yard. Taylor said all vessels, regardless of size, have to drydock every 30 months. “It’s a size requirement for the various classes, Lloyd’s, Det Norske Veritas, American Bureau of Shipping, Class Nippon Kaiji Kyokai (Japan). “If their day rate for the vessel is US$40,000 and a ten-day drydocking takes 25 days, they have lost 15 days of revenue. That’s US$600,000 that they effectively have to add on the cost of the drydocking they’ve lost already, so turnaround time is critical for them. “The drydock did not have a reputation for quick turnaround, on-time performance and quality of work. “We went out and actively marketed the yard. We brought in a new chief executive officer, Englishman Alasdair Kennan, who is married to a Trinidadian. He used to teach at the University of T&T.” Part of changing the culture at Caridoc involved bringing in new management skills. Before coming onboard, Kennan worked as a superintendent for Anglo-Eastern Group Ltd, one of the world’s largest ship management companies. Other members of the Caridoc management team are Wayne Beharry, chief operations officer; Janelle Joseph, chief financial officer; Richard Oudan, commercial manager, and Jerome John, ship repair project manager. Of Beharry, Taylor said: “He knows everything there is to know about this shipyard. He is the historian of this shipyard. He knows everyone and he doesn’t forget anything.”
The marketing of Caridoc
Taylor mapped out how he lured old customers, PG Tanker, from a shipyard in Curacao. And wooed new ones. A seismic vessel chartered to Centrica Energy needed its 65-tonne stern thrusters changed. The job scheduled for 12 shifts over six days, six nights was done in nine days. “Essentially, I leveraged my family name and history. My family came to T&T in 1970. My dad, Elam Liston Taylor, was working at Bahrain at the time, but came here to work as the production manager for this dockyard. I grew up playing in this dockyard. On weekends, when my dad was working, my brother Paul and I used to run around this dockyard.
“I would say my brother is probably the top marine surveyor in the region. There are guys in the yard who knew my father. They’d say, ‘Young Taylor, I know you, you know.’ “I went to Maritime Preservation the other day, which is another small facility. One of the other small companies in the group has a tug down there, and the guy on the tug came up to me and said, ‘I know your father, you know. He said, ‘your father made me the man I am. Your father sent me to London to learn.’ How do you feel when somebody says that to you? Taylor paused, “...to cry every time.” “I’m always immensely proud of my father. When I see how unselfishly he has touched other people’s lives. “I never heard anyone say any negative thing about my dad, from fitters to labourers, to people who are now have their own marine surveying companies. “My brother took over my father’s company, Taylor Engineering Agencies Ltd, at my dad’s house in Petit Valley. My brother’s eldest son is now qualifying in Southampton in the same field. His other son is doing hydraulic engineering and is working for SMT Ship Management and Transport Ltd. Grant said he met the owner of SMT Ship Management through his brother being its agent, who flew to Trinidad to meet with Taylor and Marlon Holder, chief executive director and managing director of CL Financial.
“They signed a memorandum of understanding to start drydocking their vessels. All their vessels are 200-metre plus. One is 234 metres. It actually cannot fit flush on the dry dock. The bow sticks out over the edge. That’s the size width. “We’ve worked on two of their vessels before. We’re now quoting for another one; it’s a sister ship to the Krakow, another 234-metre vessel. That was a very strong relationship. They do four or five drydockings a year for their vessels.” Grant said if the yard has a vessel that’s between 100 and 140 metres, he’s instructed to have another drydocked alongside: “Find another vessel that’s 90 metres to come up and put them both up at the same time.” He said a 120-metre vessel in a 230-metre dock cannot generate enough revenue to support the activity of a dockyard of that size. “We’re wasting 90, 100, 120 metres. We need to average about 180 metres for it to be successful. So if we have a vessel that’s 170, 180 metres, that’s great, but once we’re down to 130, 140 metres, we look to bring up other vessels,” said the blue, short-sleeved T-shirt-and-jeans wearing Taylor, his yellow hard hat placed on the table. “And there are a lot of small vessels in the region—tugs, barges, offshore supply vessels—that want to come up and we schedule them. “Where you can compete is niche building, so fast response vessels, offshore supply vessels, tugs. They’re not really into that business. In the long-term, it’s an area I want to explore. “We use tugs, we use offshore supply vessels and we use fast response vessels. So the Government is buying ten fast response vessels and I can provide that. “If they went out to tender, and somebody outside said I would do that vessel for US$2 million, and I said I would do that vessel for US$3 million, it is better for T&T for me to do it for US$3 million because if they do it for US$2 million, it is US$2 million leaving the country. If I do it for US$3 million, the majority of that money stays here. “It is going to local labour, local skill. The only thing I’d have to bring in is raw materials. What little profit I make is re-invested in the dockyard, in all its stakeholders, which includes workers. The same thing goes for tugs. “Even if I’m more expensive, up to a certain point, it makes sense still to use me. I probably will be more expensive, but I have higher labour costs and I have to import all my raw materials. In that respect, I believe there is a niche building market we can get into.” Asked how much worth of business Caridoc had done in the last six months, Grant hesitatingly said, “We are a significant contributor to US dollars coming into the country. What I will tell you is that over US$15 million is converted into TT dollars annually.”
He spent 20 years at Republic Bank, four of which were as an assistant to chairman Ronald Harford, “but never really did core banking.”
He’s worked as a marine surveyor, in his father’s company, is a qualified ultrasound technician, and was the regional financial controller for an oil services company, International Tubular Services, based in Trinidad, controlling Ecuador, Peru, Brazil.
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