SEATTLE - When Kvichak Marine Industries built its first boats back in 1980, the Washington state shipyard catered to North Pacific fishing fleets, primarily building vessels for salmon and herring catchers.
But in the 1990s, as the fishing industry struggled, business began to sag for the small company. So Kvichak, like many other Puget Sound shipyards, turned to passenger vessels, which now account for a sizable portion of the company's business.
"Over the last few years we have made a significant transition into that business," said Keith Whittemore, vice president of Kvichak, named after a river that flows into Bristol Bay, where many Washington state fishermen work during the summer.
"In 1993 and 1994, 75 percent of our business was commercial fishing. Now we're about 0.05 percent commercial fishing and half of our business comes from passenger vessels."
At Kvichak and other Washington shipyards, boat-builders seem to agree: It's the companies that have been flexible and able to adapt to changing market condition that have survived.
These days that means building ferries and other passenger vessels, both to provide congested cities with alternative transportation sources and to carry tourists on harbor tours and other trips.
Nichols Bros. Boat Builders, a family-owned shipyard in Freeland on Whidbey Island, started out building tugs, barges and other steel vessels. But as the fishing industry grew in the 1970s, the Whidbey Island company turned to fishing vessels.
Yet, Nichols Bros. made its move toward passenger vessels early on, building its first one around 1975.
"We've been looking at the passenger market for quite a long time," said Bryan Nichols, the company's vice president. "Just like everyone else, we did it out of necessity. Either you adjusted to the markets or you closed your doors."
Nichols Bros. is one of the Puget Sound's biggest shipyards. The company, which has about 250 employees, has built vessels that sail in the Puget Sound and elsewhere. The company also continues to make work boats, including tugs and barges.
Recently the company won bids for projects in California, where transportation woes, including those in the San Francisco Bay area, have renewed the region's interest in ferries.
"Around the nation there's no doubt that this is a very strong market that is being rediscovered," said David Clark, general manager for Golden Gate Ferry. "It's primarily driven by congestion and the fact that ferry transit, where it is practical, provides a wonderful lifestyle amenity that beats the white-knuckled grip on a steering wheel that is the other alternative in many cases."
In addition to the $8.5 million, 350-passenger high-speed ferry that Nichols Brothers is set to deliver to Golden Gate Ferry next month, Anacortes-based Dakota Creek Industries Inc. built a $7 million ferry for the transportation authority that was delivered in 1998.
At least one Alaska shipyard is also cashing in on the increased demand for ferries. Allen Marine of Sitka has supplied five ferries to NY Waterway, which services New York City, and plans to deliver four more.
Clark said Washington companies were chosen to supply his fleet due to price and quality.
"Equally important is that Seattle-area shipyards have been some of the leading builders of small vessels - whether you're talking about fishing vessels, passenger vessels or yachts - for decades," he said. "You're building on a tradition and heritage of making high-quality contemporary vessels."
Dakota Creek, which built the Chinook and the Snohomish, which transport passengers across the Puget Sound between Seattle and Bremerton, began building ferries in 1995.
Right now the company is working on a 150-passenger ferry, designed by Seattle-based Elliott Bay Design Group, for the Inter-Island Ferry Authority in southern Southeast Alaska.
The biggest change in moving from making fishing vessels to ferries and catamarans was learning to work with aluminum, said Steven Nordtvedt, director of business development for Dakota Creek.
"We were primarily a steel vessel builder," Nordtvedt said. "High-speed vessels, generally speaking, are aluminum because they are lightweight. The same vessel made of steel would not travel as fast."
Clark said that in the San Francisco Bay Area and other parts of the country he believes the demand for ferries will continue to grow. The newly created Water Transit Authority in San Francisco has been charged with creating a comprehensive plan for ferry route expansion, Clark said.
"We believe that there will be a significant demand for more passenger ferries to be built," Kvichak's Whittemore said. "As congestion continues, and it's not getting any better, and people keep moving farther and farther out, the need is going to increase."
Washington's shipyards are poised to capitalize as demand continues to increase, Clark said.
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