ACE Clearwater Enterprises Inc.


Year Founded:

1949

Core Business:

Manufactures metal components for aerospace and electric companies

Revenue in 1995:

$16.9 million

Revenue in 2000:

$23 million

Revenue in 2001:

$21 million (projected)

Employees in 1995:

166

Employees in 2000:

180

Goal:

To have a global presence, beginning in Europe

Driving Force:

Demand for delivering metal components to production lines on a just-in-time basis

Firm grows components business without aid of subcontractors

ACE Clearwater Enterprises Inc. has a wide reach in the metal components industry. It makes everything from turbine ducts for General Electric Co.’s power plant generators to engine parts for Honeywell Aerospace’s commercial jet engine business.

It’s also one of only a handful of operations that forms, welds, assembles and inspects all these products without benefit of subcontractors.

The 52-year-old firm with plants next to its Torrance headquarters, as well as in Compton and Paramount gets 50 percent of its business from General Electric and Honeywell, but it also manufactures 2,000 other components each year. The list includes doors and window frames for Bell helicopters, environmental components for Airbus planes, and infrared suppression systems for Apache helicopters.

“The diversification of what we do is our biggest asset,” said Gary Johnson, the company’s vice president and husband of Kellie Dodson, the president. “We don’t go outside for anything with regards to metal forming. We’re one of the very few shops in the country that integrates everything under one roof.”

The company started in 1949 as a small El Segundo welding shop by Dodson’s grandfather, Ray Wychoff, after he returned from combat duty during World War II. With four employees, he made bicycle frames, coffee pots for Hills Brothers and tools for Mattel Inc. among other products.

After encountering financial problems in the early 1960s, Wychoff landed the company’s first major aerospace contract, making small combustible baskets to ignite jet engines. The parts sold for only 13 to 15 cents each but they were not reusable. The company sold hundreds of thousands.

Product-line expansion

With 21 employees and $600,000 in revenues in 1965, Wychoff sold the business to his son-in-law, Tim Dodson, who has been the owner ever since.

Dodson, who had been a welder with ACE for many years, expanded the product line to include components for planes’ auxiliary power units, environmental control systems and other engine parts. The company took its current name after purchasing Clearwater Tool and Dye Inc. in the early 1970s.

Supported by major contracts with Allied Signal Inc. and McDonnell Douglas Corp. (now Honeywell and Boeing Co.), ACE was generating revenues of $8 million a year by the early 1980s.

Several years later, when the business had become focused on computer and data management, Tim Dodson wanted out. His daughter Kellie, who began working for ACE during summer breaks from USC in the late 1970s, took over as president in 1988. She is expected to assume ownership within a couple of years.

The current sluggish economy is taking its toll on operations like ACE, and revenues this year are expected to be $21 million, down from $23 million in 2000. The drop resulted in about 15 people being laid off last January.

There are bright spots: ACE will assume control of Honeywell Aerospace’s 24-employee metal welding unit in Vernon and is expanding the duct making operation in anticipation of doubling its business with General Electric. In doing so, there are plans to expand the workforce to 215 people from the current 180.

The company also is developing a fuel tank for Lockheed Martin Corp.’s next-generation cruise missile. A production contract would be worth millions of dollars. “We are in a growth mode,” said Johnson. “It’s very exciting right now because the opportunities are there.”

‘Core competency’

“They’ve got their act together,” said Peter Tarantino, vice president of operations for L.A.-based Stadco Inc., an aerospace hardware and tools maker, which sometimes competes with ACE for contracts. “They are always on time and they go the extra mile to satisfy the requirements of their customers. Their reputation has spread to major customers. This shows a great management team.”

General Electric asked the company to expand its manufacturing capacity for timely deliverance of six new configurations of turbine ducts to satisfy the increasing demand worldwide for power plant generators.

By taking over the Honeywell operation, ACE will, for the first time, have a hydroforming unit a hydraulics machine that increases production.

“We’re outsourcing the work to ACE because that’s their core competency,” said William Reavis, a Honeywell spokesman. “They are already building some parts for us and now they’re going to build a lot more. It makes more business sense for them to do it than us.”