Ferguson Marine warning: 'It faces closure in..short period of time'

Stephen McCabe, the leader of Inverclyde Council, said without more work coming in, the yard could have to cut its workforce or may be "facing closure within a reasonably short period of time".

But despite the latest appeals, the Scottish Government remain uncommitted to providing direct ferry work that could save the firm.

The Scottish Government has withheld financial support for the Port Glasgow yard despite its advisers being in favour of a support package to secure its future.

READ MORE: Ministers found to breach law on ferry progress 'blocks'

The Herald revealed in November, that the board at Ferguson's warned a failure to get a committed investment of £25m to support future work casts "significant doubt" on its ability to continue.

Ferguson Marine (Port Glasgow), made a net loss of £1.3m in 2022/23 laid bare the risks to the business and pointed to a failure to get a committed investment of £25m to support future work at the Inverclyde after the delivery of the ferry fiasco vessels.

They admitted that the lack of investment to upgrade shipyard facilities as part of a five-year business plan puts at risk its hopes of extra work from BAE Systems which is delivering City Class Type 26 frigates on the Clyde.

The Scottish Government-owned yard is looking to the future, in the hopes of securing more work, with calls for a direct award of smaller ferries planned for ferry operator CalMac.

Ministers, however, has been resistant to such a move, which it says can only be done in a small number of circumstances to satisfy state aid regulations.

Critics say that it has been willing to support a direct award publicly funded contract to the the state-owned ferry operator CalMac over providing lifeline ferry services in perpuity.

The Ferguson Marine board have admitted that a lack of investment to upgrade facilities is jeopardising hopes of extra work from BAE Systems, which is delivering Type 26 frigates on the Clyde.

It has also placed a question mark over hopes to win a contract from Transport Scotland for the replacement of up to seven ageing ferries vessels serving the Clyde and Hebrides.

Scotland's lifeline services have been dogged with issues, with the delivery of ferries Glen Sannox and Glen Rosa still not online after being due to be available for passengers in the first half of 2018 when Ferguson Marine was under the control of tycoon Jim McColl. With both now due to serve Arran, they are getting on for six years late and the last estimates suggest the capital costs of delivery could have more than quadrupled from the original £97m contract cost.

Interested parties – including Deputy First Minister and Economy Secretary Kate Forbes, unions, the local council and representatives of the yard – met on Thursday for a summit in Greenock.

Mr McCabe warned that if the government's intention is to put the yard into private ownership it needs to put the yard in a position where it needs to be competitive to make it attractive to buyers.

"To do that in the short term, it needs to invest in the yard and it needs to give the yard an order to sustain it for the next few years, to a position where they can potentially put it back into the private sector.

"Because the work has run out, there is not more orders on the order book and this yard is facing clousre with a reasonably short period of time."

Ferguson Marine was taken over by the Scottish Government five years ago after its financial collapse under the control of Mr McColl as a row erupted over long delays and mounting costs over the delivery of the vessels.

Since then two men Tim Hair and David Tydeman have come and gone after being tasked with the blessing of the Scottish Government to steer Ferguson Marine into calmer waters.

Mr McCabe said after the summit: “There was a consensus in the room that we absolutely want Ferguson’s to survive, for investment in the yard, work for the yard, and for the yard to thrive.

“There’s a strong cost benefit case for a direct award to Ferguson’s.

“Ferguson’s is the last commercial shipyard on the Clyde.

“We are a maritime nation. We cannot afford for this yard to close.

“We need to build Scottish ferries in Scottish towns for Scottish people.

“It was a positive meeting but I’m not counting my chickens because tough decisions need to be made and they need to be made in a matter of weeks, not months.”

Ms Forbes remained uncommitted to a direct award.

“The Scottish Government shares a common goal with GMB Scotland, the yard, the workers and all stakeholders who met today – to seek a sustainable future for Ferguson Marine which works for employees, the taxpayer and Scotland’s economy,” she said.

“I have heard many ideas and been impressed by the energy and commitment of everyone involved. The contributions will be at the forefront of my mind over the coming weeks as we consider proposals for the yard’s medium and long-term future.

“Ferguson’s workers deserve huge praise for their dedication and hard work.

“Despite the well-documented problems, Glen Sannox is on course for delivery by the end of July and Glen Rosa will be completed next year.”

GMB senior organiser Gary Cook said the small ferry contract must be the start of a “pipeline of work” to support the yard.

“These contracts would become a springboard back to profitability and help the workforce repay taxpayers for the faith and investment already placed in the yard,” he said.

“The workers are committed, skilled and completely blameless for the errors made in recent years and must be given the chance to show that.

“Kate Forbes will leave Greenock today under no illusion about how important these contracts are to the yard and how they will help protect its shipbuilding heritage for generations to come.”

Scottish Tory transport spokesman Graham Simpson said the discussion at the summit was “useful and frank”, adding that the Deputy First Minister should learn from the “dithering of her predecessors” and make a quick decision.

“She needs to decide whether the small ferries work is awarded to the yard or put out to tender, and whether she is prepared to invest in the yard to make it commercially competitive,” he said.

“These decisions should have been taken already but instead the SNP Government have focused on delivering a ferry which is late and overbudget.”