PODCAST: Incat founder Robert Clifford on why electric boats are the future
by Stephanie Williams
Robert Clifford is the founder of Incat, a Hobart company building fast ferries for the world. Always looking to future opportunities, he has identified where Hobart sits in the next wave of transportation. For more of this interview listen to The Hobart Magazine podcast.
Where is the marine industry at right now? The marine industry is in a massive change. We went from sailing ships to steamships, and steamships to oil and coal. And next, we’re going to do away with all the fossil fuels. Exactly the answer to how is a little unclear at the moment. There are hydrogen fuels available like ammonia and LNG but they all have pretty major issues involved with them and they’re not easy to solve. So batteries and electricity is the way that we think it’s going to go. Batteries can be powered by either shore power coming from hydro in Tasmania or by fuel cells, which are hydrogen produced. So either of those two sources of power will suit a battery powered boat.
Elon Musk has made the connection, tweeting about Incat. What effect did that have? He has noticed us and we have done a couple of proposals for them over the years. He wanted to deliver his cars all round the world without using conventional ships, so we gave him a proposal for fast ships, to deliver them fast and get back fast. Nothing’s come of that but it was an interesting exercise. The second one, he wanted to land his rockets on a very large barge and then take that barge back to shore as quickly as he could, so we gave him a proposal for that as well. So he’s aware of us, that’s about all I can say!
Your career had very humble beginnings. I started off in the printing industry. I did an apprenticeship as a Linotype operator for three years, which I really enjoyed. But it was obvious that the printing industry was computerising rapidly. I didn’t even know what a computer was, let alone know where the industry was going to go. I gave that up and went fishing with my father for the next 10 years or so. When I wanted a fishing boat, I built a boat. I got out of that and built the ferry boats. When the bridge went down in 1975, I had two ferry boats and then built three while the bridge was down.
Were all five ferries working at the same time? Yes, eventually. At the end of that period, there were five ferries that all had to be sold. We sold them to various operators around Australia, the majority in North Queensland. We sold them on the never-never, like a dollar a week, because that’s all they could pay. I had a lean time with five ferries and no money coming in and an overdraft. I eventually sold those boats and the money started to come in.
When new orders came in, was it a scramble to build big enough teams to fulfill them? Yes, very much so. On the very first ferry when the bridge was down, we didn’t have any staff. But we gradually built up from three or four builders to about 60 staff when we had satisfied this Queensland market. Then we had no choice but to go to the world market with a bigger boat. We had about 200 staff to build the first 74 metre boat. On the delivery voyage of that, we got the Hales Trophy for the fastest ship across the Atlantic and we built eight more of those.
Were they exactly the same or are they tweaked a little bit for the client? The first eight boats were very similar – all the same length and same sort of machinery. Then we built the next model up and we built half a dozen of those and we’ve done that ever since. The present boats we’re doing, it’s about eight or nine of these large 112 metre boats.
Is that the largest boat you’ve built? So far. We’re planning and starting to build 120 metres at the moment and a customer has got 130 metres on order, so they’re getting bigger.
Recently you were testing a big ferry on the Derwent that eventually went to Trinidad and Tobago. How big was that? That was 100 metres. We had built six or seven of those 96 metre boats and this was a derivative of the 96. The 112s we’re doing now, mightn’t sound like much in 12 metres but they are very much bigger boats. It changes all the engineering, the boat is four or five metres wider – it’s longer, higher and bigger. In terms of volume, it’s maybe 50%, 60% bigger.
What would it take for Incat to become a manufacturer of really big boats, like your ocean liners and your Spirits? I don’t think that’s going to happen. Our upper limit is going to be something like 200 metres. We’re looking at that at the moment. I have this belief that we’re going to be offering a more standard boat to the market. The world is going to change with this electric propulsion. We’re very strong on electric propulsion because our boats are very light. We’ve had 40 years of experience building lightweight boats in aluminum. A typical aluminium boat would weigh half of a steel boat. We use a lot less power, so when we go to batteries and electric, we will use a lot less batteries and electricity than a large steel ship.
I imagine that COVID would play into the fact that people may no longer want to be on big boats with many people. Perhaps, that may well be true. Most of the ferry boats around the world carry about 1000 passengers one way or the other. What we think that’s happening with COVID is that people are not going to be flying in airplanes so much – they are going to be going on the 1000 or 500 passenger ferries. We’ve got customers in Canada that have literally halved their numbers so they’re sitting two or three metres apart. We’ve got other customers that have been almost shut down by their governments, like in Uruguay, Argentina and Spain, they’re all coming back online slowly. Europe’s opening up slowly, I think that the ferry industry is recovering and will recover much, much quicker than the airline industry.
On top of COVID, there’s the pressure from the environment on carbon emissions. In Norway as of the end of this decade, there will be a complete ban on carbon burning ships. The EU’s saying that they’ve got to cut by 25% in a few years’ time and by 50% by the end of the decade. There’s going to be a huge pressure to get rid of all the polluting fuel. LNG’s the flavour of the month at the moment but unfortunately it halves the carbon, but the methane gases that are produced are 26 times worse than carbon, so it’s an interim fuel only. Ammonia is promising but ammonia’s got to be produced and there aren’t many places to produce at the moment. Hydrogen can be produced relatively inexpensively they think, no one’s really done it yet but hydrogen is a volatile fuel. And so is ammonia, nobody likes ammonia. We’ve got to learn how to handle it and to be safe. I don’t think those fuels are anywhere near as promising as straight electricity. Batteries are heavy but it’s not as bad as it looks because if you take away 500 tonne of marine engines and fuel tanks and put in 500 tonnes of batteries, you actually haven’t done anything. We have an opportunity to change the world.
Bill Boeing had a little shipyard in Seattle at the turn of the last century. He bought an airplane and then decided it was a heap of rubbish and he could build something better. Then he got into serious production of airplanes. The 737s now, 100 years later, they’ve sold 11,000 and 747s and 787s, many, many thousands as well. I think shipbuilding’s got that opportunity with electric boats. The only way we can build them cheaper is if we build 10 or 20 a year.
How do you think you’re placed to do that? Here in Hobart, that will be difficult. This plant is capable of maybe three or four boats a year. So if we’re going to go to 10 or 20 boats a year, we will have to look for another site and that’s a possibility. We’re looking at it.
In Tasmania or further afield? If we get the right support all round, it would definitely be Tasmania, I can’t see why not. Going back to Boeing, Seattle was probably not the best place in the world for bloody building airplanes but that’s where he lived and that’s where it developed. 40,000 people build airplanes in Seattle, Tasmania could do the same thing in a marine environment.
What sort of support would it take to get that happening? Don’t know yet, certainly you need encouragement to set all these things up. You’ve got to have the right land, you’ve got to have the right labour relations and you’ve got the right electricity, which is obviously available. The hydrogen might help to make fuel cells for the batteries. So we’re investigating it. I think the real answer to that is we’re looking to the future and where we are with shipbuilding. We have this huge opportunity to change the mode of transport all together. Exactly how that’s going to work out, we don’t know yet.
There’s a lot of debate right now about the new Spirit of Tasmania vessels and where they will be built. Is it disappointing that they’ll be built offshore from Tasmania? Well, it’s a little disappointing. However, we could never build that kind of ship. Certainly we don’t want to build steel. Now, that kind of ship, for example, can never burn electricity because it would be just too expensive, they’d have a couple of thousand tonne of batteries. We’re still interested in putting a vessel on Bass Strait but it wouldn’t be from Devonport, it would probably be on a shorter route, something like Stanley to Stanley Point, which is an 150 mile route. If it’s electric powered, it needs to be on the shortest possible route. If it’s successful on Bass Strait, it would be absolutely huge on the international market.
Did you seek out those overseas opportunities or did they naturally come to you? In the beginning, they came to us, then we started a bit of a look around. It’s a very different now in terms of communication. All the negotiations for the first international catamaran we sold for the Isle of Wight were on a Telex machine. Every morning, I’d find reams of paper. We had to decipher it all and then, that marvelous invention, the fax, came along. That was the first major breakthrough in being able to transmit designs overseas.
In 1994, you won the Sydney to Hobart Yacht Race on your maxi Tasmania, how did that trip up the Derwent feel? That was a big day and it was almost an all Tasmanian crew. We had 24 in the crew and 21 of them were from here. It was very big for Hobart. We had the right boat at the right time.
Have you done other Sydney to Hobart races? I’ve done seven in total. And that was the last one. I’d been on the winning boat three times, and a second and a fourth. So the record’s pretty good.
What advice would you have for someone growing their business in Tasmania? Well, I’ve got grandchildren that I’m talking to about various businesses. If I was starting over I think I’d start a ferry service up again. Kingston, for example, is growing like crazy, Bridgewater’s growing like crazy. A decent ferry service on the river that moved the traffic and used the water, would make a lot of sense. A simple Bellerive, Hobart ferry, is not enough. Hobart needs six or seven, new jetties and two or three decent ferries. In terms of how much that would cost as opposed to road infrastructure, it’s a lot, lot cheaper. Even one roundabout or intersection these days, it’s $50 million they’d throw at it. We can build 20 jetties for that and the boats, so it’s a no-brainer.
And is anyone doing that seriously? The ferry trial has been approved. It’s been approved but they’re going to do it with the wrong boat to the wrong jetties, it won’t work. Now, at the moment, I have to say that COVID’s a problem because any ferry service on the river will get most of its money out of tourism, pretty much like Sydney does.
Was the water and boats a strong part of your childhood? Not as a young child but as a 10 year old. We moved from Sandy Bay to Bellerive. For four years of high school, I caught the ferry. While I was at Hutchins I started sailing and loved it. I would have been probably 12 years old at that stage. Sailing is actually very good for business because every five seconds the situation’s changing and the business, it’s the same. You’ve got to be thinking on your feet all the time. You’ve got to make quick decisions on the water and whether they’re right or wrong, you live with them.
What has been your career high so far? Certainly the Sydney to Hobart was one, the Hales Trophy across the Atlantic was another. What comes first, I don’t know? The bridge obviously being down and turning a business from two ferries to five and from carrying quite literally, five or 600 people a day to 45,000, that was huge.
And your career low? We owed a lot of money at one stage – $100 million to both the state government and the bankers, and we had quite a lot of ships in the system. The bank panicked and brought us into receivership in 2001. They didn’t succeed. We had one boat that was nearly finished negotiating with a Canadian customer. All the receiver managed to do was to get the price down because that customer was there anyway but he took advantage of getting the price down. Then we sold another one to an American customer. Within six months, we’d paid the bank and the Tasmanian Government off 100%. We never 100% recovered from it because banking’s always been difficult ever since.
Where do you hope the future of the marine industry lies? There’s a massive opportunity I can see ahead of us with the marine industry refocusing on non-carbon fuels and that is going to have a massive change. And we very much are, or we should be, the right builder in the right place at the right time. We build the lightest boats, we’ve got the technology, we can offer the product. To be able to look at 1000 boats is something we’ve never been able to do before – we can literally look at 1000 boat potential.
It’s incredible. What would it take to get there? That’s a good question, I don’t know the full answer, I’m working on it. Certainly, every day that there’s something in the media about this carbonisation is helping. I think batteries getting better helps and they’re getting better all the time. The hydrogen fuel cells which feed the batteries are also getting better. I think it’s a matter of time. Now, I’m at 78, so I’m not going to have the time. I don’t need this business for the money now, but I do employ people and at the moment, we’re employing about 500. Out of what I’m seeing ahead, we can employ 5000, it’s not inconceivable. Do I want to employ 5000? No, I don’t but I don’t mind setting up the business that can.
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