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Budget cuts force Howe and Howe Technologies to lay off dozens

Troy R. Bennett | BDN
Troy R. Bennett | BDN
Mike and Geoff Howe of Howe and Howe Technologies stand with their unmanned robotic firefighting machine, known as the Thermite, at their headquarters in Waterboro Monday August 13, 2012.
By Whit Richardson, BDN Staff

WATERBORO, Maine — Howe and Howe Technologies, the company known for its innovative military vehicles thanks to its own reality television show, has not remained unscathed from the mandated federal budget cuts, known as sequestration.

Contracts from the federal government for the Waterboro-based company’s products, such as the unmanned Ripsaw, have dried up because of the funding cuts in Washington, D.C., according to Mike Howe, the company’s president. He called it a “debacle,” but reiterated several times that he and his twin brother, Geoff, who serves as the company’s CEO, are politically neutral.

“Howe and Howe has been working to maintain its levels, but sequestration has certainly hurt the military contracts,” he told the Bangor Daily News on Thursday. “That’s all I can say. The government has shut down everything. There’s not much moving right now.”

About a year and a half ago, the company, which was the subject of a popular Discovery Channel show, employed between 40 and 50 people, according to Howe, who founded the company with his brother in 2001.

Mike Howe admitted layoffs have been made, but wouldn’t say exactly how many people the company has let go. However, when presented with claims that the company now employed fewer than 10 people, he confirmed the information.

“We’ve downsized quite a bit,” he said.

Once sequestration hit, Mike Howe said, the company tried to keep people employed for as long as it could — “we did it because we’re family,” he said — but it eventually became untenable.

“It’s an ebb and flow, and we’re moving with the market to stay alive,” he said.

To make up for the loss of government contracts, the company has renewed efforts to diversify away from a reliance on U.S. military contracts.

It has launched the Ripchair, an offroad vehicle for people in wheelchairs. It’s selling a 4×4 fire truck designed to fight hard-to-reach wildland fires. Its vehicles also have garnered interest from Hollywood.

However, the product with the best shot at carrying the company while military contracts aren’t on the table is the Thermite, Mike Howe said. It’s a small fire-fighting and emergency response robot that was originally developed for military applications.

The interest in robotic first response has exploded internationally in recent years, driven by reactions to disasters like the Fukushima nuclear meltdown, Mike Howe said.

“In the last two weeks, no less than 12 or 13 countries have called us wanting to get our technology. China is one of them,” Mike Howe said. “China wants to buy Thermites around the clock.”

The United States, however, is lagging in its adoption of the technology, Howe said.

“The issue is America has not at all endorsed this new stage in robotic first response technology. We’re getting calls from Spain, Dubai, China, Japan. You name it, these guys are on top of it,” he said, adding that the United States is “still stuck with its head in the sand like its the 1950s.”

Whether or not the market for the Thermite develops in this country, Mike Howe said the company hopes to be able to carve out a niche serving the emerging international market.

The Howe brothers also are branching out with completely new business models. The brothers recently launched Coastal Maine Charters, “Maine’s first high-speed, go-fast, Miami-style” fishing charter business in Kennebunkport, Mike Howe said.

It remains to be seen how well the company’s attempts at diversification turn out. Hopefully, they will help carry the company until the military starts buying its products again. Howe said Howe and Howe is one of the few small prime (as opposed to sub) government contractors that’s been able to survive sequestration, which bodes well for its future.

“The last one standing is the first one to be picked up at the door after sequestration is over,” he said.

Whatever happens, he’s confident the company will emerge stronger from this episode.

“I was telling my brother, it’s been awhile since we’ve been challenged,” he said. “We’re enjoying the challenge. That’s my glass half-full look at it.”

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