In this interview with President Yamamoto of Fukada Salvage, we take a deep dive into company’s history and operations, including their use of ROVs (Remotely Operated Vehicles) and AUVs (Autonomous Underwater Vehicles)
What is your assessment on Japan’s construction sector, and what needs do you see in the years to come?
The main business we want to focus on is installation of bridges and other infrastructure. We have six floating cranes. In the 1970s, there was a huge infrastructure boom and we worked on big projects such as coastal development and others. However, this infrastructure is aged and now require maintenance and repairs. In Kansai, we’ve had projects like extending the Kansai region coastal expressway. We also want to win projects in building bridges nationwide. We expect a new demand in harbor construction, especially for defense purposes. With the Ukraine war, North Korea’s missile launches, and China's invasion of territorial seas, there is a need to set up new bases and expand our current airports to defend Japan. We also want to focus on disaster prevention. We often suffer from high tides and sometimes Tsunami so we have to improve our ports and rivers to prevent extensive damage from these natural disasters. Furthermore, our current floating cranes and barges are aging, so we have to renew our equipment as we try to pursue carbon neutrality and start replacing our use of coal with renewable e.g., biofuel etc.
What makes Fukada the best choice for both domestic and overseas projects? What are the strengths that make you a competitive option?
Our core business is salvage, but we have six other businesses which are quite rare for salvage companies. We have expertise in different business areas that we can combine for strong synergies.
Your six core businesses are salvage, steel construction, marine civil construction and development, offshore power and towing. Can you tell us the advantages of having so many core businesses and some of the synergies you are able to create between these businesses?
In our salvage operations, it is very difficult to look for aircraft that crashed from water depth 3,000 meters. We use AUV (Autonomous Underwater Vehicle) to identify the location of the aircraft and use our ROV (Remotely Operated Vehicle) to lift them up. Both the AUV and ROV equipment are operated by our marine engineering business. Since we own these types of equipment, we can use them for our salvage operations. Recently, our marine investigation team searched for the ship that sank off Shiretoko Peninsula in Hokkaido. The boat sank to a depth of about 150 meters. We used our ROV to identify the location, and our partner Nippon Salvage used their divers to find no survivors in it. During towing and taking it to port, unfortunately it dropped again and sank even further to 180 meters. The special submarine team said it might take about 1-2 months to fully recover the boat, but with our ROV operating with the partner’s boat, we quickly identified the drop point and used ROV to hook it, and tow it within two days.
Japan's aging population has had a pronounced effect on the construction and civil engineering markets. By 2035, 1 in 3 people in Japan are going to be over the age of 65. This year, however, 1 out of 4 construction workers or civil engineers are already over that age. Can you tell us the impact of Japan's aging population on your business?
The number of students majoring in marine science and technology has drastically dropped in recent years. I am from Tokai University, School of marine science and technology. In my time, there were a thousand students in the same year level, but that number has dramatically decreased. Nowadays, there are very few students who want to join this field. There is also the challenge of overwork. The government is now promoting the work style reform of Japan. However, in the field of marine engineering and investigation, there tends to be a lot of overtime working on the boat once they are involved in an investigation. It is very difficult to control their working time. We foresee more shortages of resources in the future. There is little academic training and education in the marine engineering field, so there is a mismatch between the needs and training provided. As a result, our company provides our own unique training and education program. We put together our know-how and expertise in textbooks and lectures to impart knowledge and training to new talents. We set up our company vision in July of last year. Our first vision is that we need to develop talent. It is important for us to develop workers' skills and expertise. Second, we need to improve our technologies to hand them over to the next generation. Third is establishing a happy company.
We want to ask about your revolutionary method called the Dry Method. It allows for the maintenance and inspection of submerged civil construction projects as if they were on dry land. Can you introduce to us this method and explain to us why it is safer and more effective than conventional means for underwater infrastructure inspection?
One of the advantages of this approach is avoiding the waves and the murky water that comes with ships passing. We can even conduct operations at night if we use lighting equipment. This setup allows the customers to visually check and inspect because it is dry circumstances.
With Japan's market continuing to shrink, many construction firms are looking overseas to compensate for the lack of work. You have a diverse project history of working overseas in East Asia, South East Asia, and New Zealand. We would like to know more about your international development plans. Are you looking to increase the ratio of your overseas projects? If so, which locations are you looking at?
Before I joined the company in 2017, I worked for our parent company where I was responsible for moving our plants overseas. I stayed in Indonesia for five years. Our target is Southeast Asia. In the salvage area, Japan's accuracy in meteorological forecasts has improved. We also have improved safety awareness. Furthermore, we have accumulated experience in ship operations, which lowered our number of operation accidents. On the other hand, Southeast Asian countries have a lot of marine accidents because they have less expertise, experience and technology. In cooperation with Asian companies and Japan's marine security agencies, we want to provide our service to help these countries when there are accidents. This is our social contribution. We are accepting demand from countries such as Vietnam, Myanmar and Bangladesh. We expect a lot of business construction needs in these countries. We own floating cranes which they do not have. We can use our assets and technologies to build bridges in these countries.
What steps are you taking to take advantage of the demand that you see there?
I worked on projects in Indonesia, Malaysia and Singapore and helped create subsidiaries. We have a network of subsidiary groups and companies through our parent company, so we can establish our own network using this already existing network.
Can you share with us a project that you have participated in that you are most proud of?
Personally, the project I remember the most is in 2018 when typhoon number 21 hit Japan. There was a big tanker that crashed and hit the access bridge at Kansai international airport and the bridge collapsed. My house in the southern part of Ashiya-city suffered from flooding and my car was damaged. At the time there was a blackout. I received a cell-call from the Ministry of Land Infrastructure, Transport and Tourism on the night of the accident. They asked us to send Floating Crane Musashi and Deck Barge Ocean Seal-2, to where the collapsed bridge was. We immediately dispatched them, removed the broken bridge and replaced it with a new one. This was in September, so we needed to make repairs quickly and not miss opportunities for inbound demand by “Golden Week” holidays in May. There were two broken locations, but in collaboration with the bridge manufacturers, we quickly fixed and replaced them with new ones.
Your company is celebrating its 112th anniversary this year. If I come back 3 years from now and have this interview all over again, what would you like to tell us? What are your dreams for this company and what goals would you have accomplished by then?
We set up our three visions in 2017. I'm not sure if we are able to achieve them all in 3 years' time, but we would like to have a happy company, grow talent and improve our knowledge and technologies. We would also want to focus on offshore wind power generation. Although our progress has been very slow, it is one of our priorities to support government initiatives. We hope that our project will proceed as planned.