Ferguson Marine misses out on vital £175m CalMac ferry contract

Ferguson Marine’s failure to win a contract to replace seven small CalMac ferries could be the “death knell” for the publicly-owned shipyard, the Scottish Tories have warned.

The ferries procurement agency CMAL has named Polish shipyard Remontowa as the preferred bidder for the £175 million small vessels replacement programme.

This comes just days after the new MV Glen Sannox, which was built by the Ferguson Marine shipyard, had to be removed from service after a hairline crack in the ship’s hull was discovered.

The MV Glen Sannox, recently built at Feguson Marine shipyard. | Jeff J Mitchell/Getty Images

Remontowa in Gdansk has previously built the MV Argyle, MV Bute and MV Finlaggan, and was the runner-up for the contracts for the MV Glen Sannox and MV Glen Rosa in 2015.

The contract to build the seven all-electric small ferries had been a key part of the nationalised Ferguson Marine’s five-year recovery strategy following the chaos of building the MV Glen Sannox and the MV Glen Rosa for CalMac.

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As the last commercial shipyard on the River Clyde, Ferguson Marine had vowed to bid “aggressively” for the contract and had made it onto a shortlist of six bidders.

But CMAL said it had to appoint a yard “capable of producing quality vessels” and give the best value for taxpayers.

Kevin Hobbs, chief executive of CMAL, said: “It is our responsibility to follow the public procurement strategy for Scotland and appoint a yard capable of producing quality vessels which meet the needs of islanders, but that also deliver the best value for the public purse.

“We are confident in Remontowa’s ability, and have worked with them before, most recently with the delivery of the MV Finlaggan in 2011.”

The launch of the MV Glen Rosa at the Ferguson Marine shipyard. | John Devlin/National World

Last summer The Scotsman reported that Scottish ministers did not expect Ferguson Marine to win the competition to build the seven new electric ferries, but believed their £14m investment plan for the shipyard would give it a good chance of securing an order for a further three CalMac vessels further down the line.

The shipyard in Port Glasgow is now pursuing other options including defence sub-contracting work from BAE Systems and private sector work.

Bosses at Ferguson Marine say they are “disappointed” as they would have been "perfectly positioned” to take on this multi-million pound contract.

David Dishon, CFO and accountable officer at Ferguson Marine, said: “Naturally we are disappointed that we were not selected as the preferred bidder for the small vessel replacement programme.

“Ferguson Marine is perfectly positioned for this type of work.

“Six of CalMac’s major vessels started life at our yard in Port Glasgow, including three ferries incorporating a low-carbin hybrid system of traditional diesel power and electric lithium-ion battery power - the first of their kind in the world at the time.”

Mr Dishon says he “remains optimistic” about securing contracts in the future, despite this setback.

He said: “We remain optimistic about the future of the yard and ongoing discussions with commercial partners continue to progress with promise.

“We have also begun plans to allocate the first phase of the £14.2m in capital investment from the Scottish Government, which will support us in making vital updates to the yard, its equipment and infrastructure.”

Transport Secretary Fiona Hylsop said: “These seven new vessels will help improve connectivity and resilience for island residents, businesses and communities, and their electric operation will contribute to reduced carbon emissions from Scotland’s ferry fleet and make ferry travel more sustainable.”

Transport Secretary Fiona Hyslop.

Duncan Mackison, CalMac’s CEO, said: “These seven new vessels, when combined with the six major new vessels joining the fleet in 2025 and 2026, will mean a third of our entire fleet has been renewed.”

Alex Logan, GMB convener at the yard, said: “This is another blow to a workforce that has been used as a political punchbag for far too long.

“The reputation of skilled and committed workers has been dragged down by the incompetence and miscalculation of others.

“They deserve better and this contract should have allowed the yard to seize back a reputation for excellence unfairly torn away.

“The Scottish Government is investing in the yard, but what use is investment without contracts? We had a worldwide reputation for building small vessels and sending this work overseas makes no sense for the workers, for islanders or for the people of Scotland.”

The move has been criticised by opposition parties in Holyrood.

Sue Webber MSP, the Scottish Conservatives’ transport spokeswoman, said: “This announcement is devastating for Ferguson Marine and could yet prove the death knell for the yard.

Sue Webber MSP | supplied

“It should be a given that a nationalised shipyard wins a Scottish Government contract, yet it’s a measure of how badly the SNP have mismanaged Ferguson’s that ferries which should be built on the west coast of Scotland are instead to be made in eastern Europe.

“The blame for this outrageous situation lies squarely with incompetent SNP ministers who have let down workers at the yard, and ferry passengers across Scotland, at every turn.

“SNP ministers can't pass the buck any longer on this scandal.”

Claire Baker MSP, Scottish Labour’s transport spokeswoman, added: “This is another blow to Scottish shipbuilding and the industry’s skilled workers.

Claire Baker MSP

“On the SNP’s watch, Scotland’s iconic shipbuilding industry has been let down and jobs and investment are going overseas.”

Willie Rennie MSP, the Scottish Lib Dems’ economy spokesman, added: “This is the hangover from the SNP’s ferries fiasco.”

A spokesperson for the Scottish Government said: “Ministers back the board’s vision and have allocated up to £14.2m over the next two financial years to enhance yard infrastructure and deliver productivity improvements, provided standard commercial tests can be satisfied.”

Former Ferguson Marine chief executive David Tydeman said: "With no chief executive and slippage of Glen Rosa, this decision to place the order with the underbidder from 2014 is logical and secures fastest delivery and best price for the islands communities. The challenge for Ferguson is how to pay the bills (when companies house show) to cover £13m per annum of salaries and more than £7m of other overheads which can't all be charged to Glen Rosa."

The seven new “loch class” are expected to join the fleet from 2027 and will serve the following routes: Colintraive-Rhubodach (Bute); Lochaline-Fishnish (Mul); Tarbert (Loch Fyne)-Portavadie (Peninsula); Iona-Fionnphort (Mull); Sconser-Raasay; Tobermory-Kilchoan (Mull); and Tayinloan-Gigha.