Fairbanks Morse Defense
Fairbanks Morse Defense sees service as engine for growth
By Edward Lundquist
USCG Cutter Mohawk.Photo courtesy FMD/USCG
Throughout the company’s 150-year history, Fairbanks Morse Defense (FMD) has built a reputation as the world’s premier naval engine supplier. But today, the company is taking on a wider role as a full- service defense contractor. In the process, the company has made some recent strategic acquisitions to position the company with a broader maritime portfolio.
FMD is a “portfolio company” of Arcline Investment Management, a $4.4 billion company which owns businesses in a variety of market sectors.
FMD has manufactured the main diesel propulsion engines and ship’s service generators on a number of classes of Navy ships, Military Sea Lift Command auxiliaries and Coast Guard cutters. According to a company statement, Fairbanks Morse engines are installed on approximately 80% of U.S. Navy ships that have a medium speed power application.
Image courtesy FMDThe industry typically knows us as Fairbanks Morse engines. We've been selling engines to the Navy since the 1920s. We recognize that our engines are our bread and butter. But when we look at our business model, we want to be focusing on the service side. That has influenced our acquisition and the expansion strategy. We changed our name to Fairbanks Morse Defense because we want to be known for more than just engines.” George Whittier, CEO, Fairbanks Morse Defense.
According to Chief Executive Officer George Whittier, the company’s engine business is stable, but it’s not necessarily a growth-oriented business. “Our recent acquisitions have helped us rapidly expand, and we’ve also experienced a great deal of organic growth over the past few years,” Whittier said.
“We realized that we were really more than an engine company,” said Whittier. “The industry typically knows us as Fairbanks Morse engines. We've been selling engines to the Navy since the 1920s. We recognize that our engines are our bread and butter. That's still the majority of the business. But when we look at our business model, we want to be focusing on the service side. That has influenced our acquisition and the expansion strategy. We changed our name to Fairbanks Morse Defense because we want to be known for more than just engines.”
FMD has completed seven acquisitions in the last 18 months. With a growing array of best-in-class marine technologies, OEM parts and turnkey services, FMD is positioned to serve as a single-source product and service solutions provider for the entire vessel.
“We're in a fortunate position financially and have been able to buy a handful of companies in the past year or so. People know this, and companies have approached us. We know what we want, and we’ve been able to be selective. Our business model revolves around service. We’re looking for maritime and industrial companies that have a high service attitude,” Whittier said.
Whittier said that FMD hopes to build upon the existing service networks of its newly acquired companies and create a network that’s responsive to all of their clients across all of the products.
“These companies have great products. We already have this great service network and a good reputation, so we asked ourselves how we could leverage those attributes to grow. We can now use our network to provide service for those companies. By becoming a more service-oriented company, we think we can grow our business even more.”
Apparently, FMD isn’t done shopping. According to Whittier, “We’re always looking for companies that are a good fit.”
In particular, FMD wants to focus on the core problem areas for the Navy. “We spend a lot of time listening to them as our customer. And then we say, ‘Okay, well, what can we do to help solve some of their problems? How do we execute around that?’ The direct result of that is some of the companies that we actually have bought.”
“One of our goals is to be as close to the Navy as we can be physically as well as intellectually,” Whittier said. “We already do a lot of training for the Navy, and they've asked us to increase that.”
“As we conduct these acquisitions, we’re not looking to shut anything down,” said Whittier. “The expertise and product knowledge that our new companies have is so critical.”
The company’s workforce is expanding, from about 400 people to 1,000 in the last couple of years, with about 450 of them working at the main manufacturing plant in Beloit. “We’ve grown our service network from about 75 people two years ago to about 130 today, and we want to get north of 150.”
FMD delivered four FM 6L48/60CR engines to General Dynamics NASSCO in San Diego for Military Sealift Command on the USS John L. Canley (ESB 6) in March of 2021.
Another way the company will support customers is with its FM OnBoard remote video collaboration tool that allows onsite users to engage directly with a live, offsite FMD service technician.
FM On-Board combines an intelligent sensor suite with a virtual reality component so that a Sailor can wear a headset and be talking with an expert back at FMD, who can see what the Sailor is seeing and help him or her to identify and fix the problem.
FM OnBoard uses “party-to-party video conferencing viewed through mixed reality headsets,” according to a company press release. “The headset also enables users and remote technicians to see 3D visualizations of connected assets and their performance data so the remote support technician can guide onsite users through troubleshooting, maintenance, or repair services. When onsite service technicians wear the mixed reality headsets, the program's IoT Remote Visualization tool projects 3D digital assets communicating the asset’s current state. This enables users to interact with the asset and its components to monitor performance, detect anomalies, and conduct necessary maintenance or repairs. FM OnBoard subscribers receive mixed reality training, guided maintenance, standard work procedures, and evidence recording to keep accurate maintenance and service records – all accessible through the mixed reality headsets.”
Furthermore, he said, the company can provide that same capability for other equipment “It could be a gas turbine or a water pump—it doesn’t matter. As long as we can get the data set up front, and we can get access to the experts, we can provide the service. It will take us some time before we can get up and running with that. But those systems are clearly able to do that. Take Welin Lambie, the davit manufacturer. We recently acquired them, and we’ll be able to put their systems into our FM OnBoard suite. Every ship has davits of one type or another. Ships have to have 100% of their davits working or they can’t sail. This capability will help get davits working as quickly as possible.”
"FM OnBoard gives our customers instant access to support services and allows them to leverage the OEM expertise of our senior-level technicians – all while saving money and reducing the length and number of field service mobilizations," Whittier said.
FMD Expands via Acquisitions
- BRECO International Inc., a diesel engine repair and rebuilding service provider specializing in the ALCO brand, was acquired in November 2020. The company offers diesel engine repairs and rebuilding services in the field and on-site from its machine shop in Houston. BRECO also supplies ALCO parts from its Houston site and has a large inventory of new and remanufactured engine replacements parts at its warehouse in Gig Harbor, Washington.
- Hunt Valve Company Inc., with facilities in Salem, Ohio, and Montreal, Quebec, Canada, makes naval valves and electromechanical actuators to deliver innovative fluid power solutions for its core defense and industrial customers. The company was acquired by FMD in September 2021, and includes Hunt Valve, the Hunt Valve Actuator Division, MB Valve (Montreal Bronze), and Pima Valve, LLC.
- Welin Lambie Ltd. is a U.K.-based leading designer and manufacturer of davits used specifically for the launch and recovery of all types of craft from ships or shore-based installations, was acquired in December 2021. Operating from its facility in Brierley Hill, West Midlands, U.K., Welin Lambie serves customers in the U.K., North America, and worldwide.
- Theodore, Ala. -based Fluid Filtration Specialists LLC (FFS) which now operates as FMD, provides fluid separation and cleaning systems, as well as flushing and filtration services for marine vessels and other facilities that operate large, highly sophisticated engines and systems. The company was acquired in December 2021.
- Ward Leonard, Inc., was acquired in January 2021. For more than 125 years, the Thomaston, Ct., company has provided electric motors, generators, controls, and service solutions for critical naval applications.
- In January 2022, FMD acquired Maxim Watermakers of Shreveport, La., which provides water treatment and purification technologies for marine defense applications. Maxim’s products and services, including evaporators, reverse osmosis systems, salinity monitoring equipment, cleaning solutions, engineering, parts fabrication, and technical services, provide water for vessel operations and crews during ship deployments.
- Cincinnati, Ohio-based Federal Equipment Company (FEC) was also acquired in January 2022. FEC designs and manufactures components and systems for Navy, Coast Guard and commercial ships, includeing advanced cargo elevators, engineered doors and specialized material handling equipment.