Polish yards sinking Ferguson

Ferguson Shipbuilders, the last independent yard on the Clyde, is facing a ?life or death? battle over government contracts for two new fisheries vessels. Alan Dunnet, Ferguson’s chief executive, who rescued the 102-year-old Port Glasgow shipyard in the mid-1990s with his father, Frank, believes the Scottish Executive is driving the final nail into the coffin of the yard by forcing it to compete without favour against new subsidised members of the EU.

Dunnet says Ferguson is unlikely to win the contracts because of “hidden subsidies” and substantially cheaper labour in countries such as Poland, and that the executive has refused to take this into account in the tendering process. At stake is $57m of orders to build the two new fisheries research vessels, the livelihoods of 300 skilled workers and the existence of one of the Clyde’s last remaining shipbuilders.

“This is life or death for Ferguson’s. That’s exactly what it is,” said Dunnet, whose small yard is one of the three shipbuilders left on the Clyde, it is also the only one in Scottish hands. The others, the former Yarrow yard at Scotstoun and the old Fairfield yard at Govan, are owned by BAE Systems.

The shipyard claims that in the last six months alone, it has lost $150m worth of government contract orders, which have been placed either directly or indirectly with one particular yard in Poland. Dunnet says that his yard cannot compete with cheap labour countries like Poland with and hidden and illegal state subsidies, such as the subsidies to make the steel cheaper. He went on to say that there is no other country in Europe whose government contracts are won by overseas companies citing that the French, Germans and Dutch all retain their government contracts in-house.

The business turnaround of Ferguson’s in recent years is nothing short of remarkable, especially in an era when heavy industry has almost disappeared from the Clyde.

In the 1980s, the yard came within a hair’s breadth of going the way of its competitors. By 1989, the company had dwindled to two dozen employees and was on the brink of closure. However, since the mid-1990s, Ferguson has built a reputation for manufacturing small vessels with sophisticated engineering needs. These include tugs, oil-industry supply ships, anchor handlers, ferries and a variety of specialist vessels, such as the two fisheries research ships it recently built for the Department for Environment, Food and Rural Affairs.