Exclusive:Ferguson Marine seeking direct award to build major new CalMac ferry

Shipyard lobbying for contract for Lord of the Isles replacement

The Scottish Government-owned Ferguson Marine shipyard is hoping to be handed another major CalMac ferry order, The Scotsman has learned.

Ferguson Marine is seeking the direct award of a contract to replace the 500-passenger Lord of the Isles, which the yard built 36 years ago.

The MV Lord of the Isles | CalMac

The news comes after ministers this week awarded Scottish Government-owned CalMac a new contract without a competition, unlike previously.

The Port Glasgow yard is still struggling to complete the second of two-hugely late ferries for CalMac, whose delays have been blamed on previous management, including before the firm was nationalised in 2019.

Glen Sannox was finished in November last year, six-and-a-half years late. Sister vessel Glen Rosa is not due to be delivered until at least September.

Ferguson Marine is desperate to secure new work to follow Glen Rosa. Ministers decided against directly awarding the yard seven smaller electric CalMac ferries and Ferguson Marine subsequently lost the competition to a Polish firm.

Deputy Minister Kate Forbes argued that a direct award could have triggered a legal wrangle and delayed construction.

Scotland’s transport links are the lifeblood of the nation - subscribe today to our Transport newsletter

An industry source said of the latest contract: “Ideally, they want a direct award to build the replacement for Lord of the Isles, but if not, then they would register interest should there be a competition.

“They think the CalMac contract announcement sets a precedent for a direct award of some kind and are in the process of engaging with [Transport Secretary] Fiona Hyslop to find out what is possible.”

Lord of the Isles serves the Mallaig-Lochboisdale route | CalMac

The Scotsman has learned a decision over going ahead with the order is due to be made by Transport Scotland’s investment decision making board next week, which would need to approve its outline business case.

Transport Scotland said last month this year’s Scottish Government Budget “had provision to procure the tender for replacement of the Lord of the Isles”.

The vessel, known as Loti, normally operates between Mallaig and Lochboisdale in South Uist, but has been temporarily redeployed to the Islay route to cover for another vessel.

West Scotland Liberal Democrat MSP Jamie Greene said: “If Ferguson Marine is confident it can build this ship on time and within budget, I don’t see any reason why they shouldn't be allowed to.

“The Scottish Government has given the direct award of the west coast ferry contact to CalMac, stating there were no legal barriers to them doing so. And yet oddly, it used the opposite argument as to why it couldn’t give a direct award to the publicly-funded Ferguson Marine.

“For years, the SNP repeatedly stated that there would be a pipeline of work at Ferguson for generations to come. Instead, contracts have gone to Turkey and Poland, with things looking increasingly bleak for the workforce at the yard.”

Louise Gilmour, Scotland secretary of the GMB union, which represents workers at the yard and has campaigned for direct awards, said: “We were told repeatedly how there are legal obstacles, but these are insurmountable when convenient for ministers and dissolve when not.”

Scottish Conservatives shadow transport spokesperson Sue Webber said: “These are the sort of contracts Ferguson Marine will require if they are to flourish in the future. However, due to the SNP’s botched nationalisation of the yard, it has left them at a huge disadvantage in bidding processes like this.”

Transport Scotland said procurement rules meant direct awards were only possible “in strictly limited circumstances”. It said that under the UK Subsidy Control Act, such shipbuilding contracts “must be capable of withstanding legal challenge”.

A spokesperson said: “Ministers will consider future vessel contracts from public agencies on a case-by-case basis to determine whether any might legally be open to direct award.”

Caledonian Maritime Assets Limited, which orders ferries for the Scottish Government, indicated it was not expecting a direct award.

Its spokesperson said: “Subject to approval next week of the outline business case for the Loti replacement contract, and funding, we intend to begin an open procurement process for the new vessel in the middle of June.

“We welcome all interested shipyards to submit a tender.”