By ANDREW A. DUFFY – Timescolonist.com
Some are calling it a harbinger of better times for the forest industry.
Others consider the first Madill-branded log loader to come off a production line in nearly three years a shot in the arm for a 63-year-old Greater Victoria manufacturing company.
Regardless of the perspective, that first $500,000 log loader currently sitting in the yard of Nicholson Manufacturing awaiting transport to a logging operation in Oregon marks the re-birth of one of the oldest names in coastal logging.
Three years after declaring bankruptcy and shutting down operations in its home base of Nanaimo, the Madill equipment brand, which turns 100 this year, is back in production.
Nicholson, founded in 1948, is preparing to ship its first Madill log loader this week after buying the assets of the bankrupt company and putting its intellectual property back on the production line.
“As a company we are very proud of this,” said Doug Jeffrey, president of Nicholson while beaming at the brand new loader in his parking lot. “And it’s a very good fit for us.”
Jeffrey said for decades both companies carved out a strong reputation for building robust, heavy-duty forestry equipment and now both equipment lines — Nicholson’s log de-barkers and Madill’s loaders, yarders and feller-bunchers — will be coming off the line at the seven-acre plant in North Saanich.
“When you marry the two brands, the philosophies of both companies were eerily similar when it comes to designing products,” Jeffrey said, noting Nicholson is intent on maintaining both product lines as industry leaders. “It wasn’t like we had to take their products and re-engineer them to get them to our standards.”
Madill, founded by Sam Madill in 1911, was a fixture in the coastal forest industry as a leading producer of equipment specifically designed for tough, steep coastal terrain. It went bankrupt in April 2008, putting 190 people out of work.
Its assets were originally bought by Washington state-based Modern Machinery in 2008, but that company only sold what was left of the machines and maintained an inventory of parts.
“The result was there was very little disruption to customers in terms of getting parts, but there were no plans to manufacture,” said Jeffrey. “They were very open to coming to a deal that would see us bring new equipment back to the marketplace.”
That deal was completed in January. It then took three weeks to ship 100 years and $5 million worth of parts, inventory and legacy from Nanaimo to Nicholson’s 110,000 square foot manufacturing site, then itemize and organize the equipment before engineers got to work on the manufacturing plans.
The four remaining Nanaimo-based Madill employees who were providing parts support have joined Nicholson.
It was a new start for an old and trusted name.
But it was also a new lifeblood for Nicholson which like all companies tied to forestry has suffered through some of the worst years the industry has faced, and is just now starting to see some light at the end of the tunnel.
“What we saw was an unserved need in the marketplace — who would replace this brand,” said Jeffrey. “Given we are a Vancouver Island company, the customers are in close proximity to this facility and we had unused capacity that needed filling. It was a good fit.”
Nicholson spent $9 million to modernize its facility. Now with a line of new equipment coming through the line, the company will be pushed and will start looking for skilled trades, engineers and sales staff.
“(Our people) are excited and proud and they have done all the work. We set the stage but they executed well,” said Jeffrey. “This gives people who have tied themselves to this company a better sense of security in terms of us broadening our revenue stream.”
Ron Hait, Nicholson’s North American sales manager, said interest in the new line has been high since news spread Madill was back. “We are getting calls weekly, there’s a lot of interest out there in all aspects of the business — loaders, feller-bunchers and yarders,” Hait said. “Once people heard that Madill is coming online a lot of people have been asking when the next ones will be coming off.”
The company is aiming to produce four Madill machines each month by December, while maintaining its de-barker production which can range from two or three a month to five or six depending on demand.
Jeffrey said the Madill production will eclipse de-barkers as the bulk of the business.
Graham Lasure, president of the Truck Loggers Association, said the return of Madill is a positive sign for the industry and comes as logging companies are ramping up production.
“Everyone really misses the brand, it’s nice to see them back and of course we want to see competition in the equipment market,” he said, noting many logging outfits simply have not been able to find good used or new equipment as they are being asked to ramp up.
“Licensees are asking people like ourselves to gear up and provide more and we have been having trouble for a couple of reasons — availability of good used equipment has dried up and availability of new equipment is hard to find and it’s hard to find employees,” said Lasure of W.D. Moore Log Co. Ltd.
Rick Jeffrey, president of the Coast Forest Products Association, said the harvest levels are being driven by demand in China and that will mean companies like Nicholson are going to be answering a lot of phone calls.
“There has been pent up demand for forestry logging equipment,” he said. “And in order to ramp up to new higher production levels I suspect Madill will start to see some improvements in orders.
“We lost a bunch of capacity and now folks who are left are leaner, meaner and more efficient operators and all of a sudden there’s a lot of work to do and they don’t have the capacity to do it — they are making capital investments to meet the new demand.”