I think there were three questions. I'll see if I can get to them.
On the first one, it's interesting that you talk about Hyundai. It is an amazing facility. In previous lives I've actually built ships in Hyundai as well as some of the other Korean shipyards. Also, ironically, they are absolutely getting killed. You talked about business being cyclical. Right now the Chinese, Korean, and Japanese yards are having tremendous difficulties. I believe Hyundai alone lost $2 billion U.S. last year. Cycles come and go, and right now they're in the trough of one.
What we talk about is if, God forbid, you get to those troughs, how do you fill them? As for the capacity gap that I was talking about, there are two. There's a short-term gap when we'll have maybe 10 months in between the OFSVs—the ocean fisheries—and the OOSVs. That we'll figure out. There'll be something to close that gap. The capacity beyond the first seven ships is still a point of discussion between us and the Canadian Coast Guard, because it's going to be that natural tension between operations that want all the ships now and the shipyards that want to stretch them out to have a continuous flow of work.
If the work is stretched out, the whole concept that we were hoping and looking for was about, say, 50% to 60% federal work and 40% to 50% commercial work. That's what we were going to hope for once we got through the first seven ships. The first seven ships will really keep us busy. Looking at the long term is exciting to us, because now we can leverage off the federal government contract but not be solely dependent on it.
I mentioned BC Ferries, a large fleet in our backyard. Seaspan, as part of our other operations, is one of the largest vessel operators in Canada, so we could be building vessels there. We have been contacted by other foreign countries, and we know that there's now something that could actually be traded, perhaps sugar cane from Brazil, in return for vessels that we could build for them, and things like that. It can be a trading chip that Canada gets to use that, quite frankly, didn't exist up until five or six years ago.
Regarding pitfalls and risks of small and medium-sized enterprises, that's spot-on. It is a real issue and concern and one we work with them on very closely. We understand that if they're normally producing 100 widgets a week, and now we're going to ask them to go to 2,000, we've really increased their revenue and hopefully profitability, but two things arise: one, can they handle it? Two, if they can't handle it, what does that do to our schedule? I dare say we have had some problems with that aspect.
What we're doing is we're learning, as I'm sure the Irvings are as well. You're teaching your own employees and business how to grow to this new contract, and you're also doing it with your vendors, especially the small and medium-sized enterprises. I will say the vast majority of them are coming up that curve. To some of them we've unfortunately had to say, “You know what? Maybe you just can't handle this”, and we've moved on efficiently to somebody else.