Govan future may hang on ferry work

Survival hopes for Kvaerner’s Govan yard have been enhanced by news that it is on the shortlist for a £200m order for six MoD roll-on roll-off ferries. The contract winner will not be announced before autumn. But the yard will run out of shipbuilding orders by mid-summer and needs new contracts to secure a future […]

Survival hopes for Kvaerner’s Govan yard have been enhanced by news that it is on the shortlist for a £200m order for six MoD roll-on roll-off ferries.

The contract winner will not be announced before autumn. But the yard will run out of shipbuilding orders by mid-summer and needs new contracts to secure a future for 1,200 workers.

But unions say shortlisting alone is not enough. ‘It’s a step forward but time is against us,’ said GMB union convenor Jamie Webster. ‘We have to send positive messages to Kvaerner and ensure we become the preferred bidder.’

The Kvaerner group is also expected to announce its review of global shipbuilding at the end of next month. The Anglo-Norwegian group has just announced pre-tax losses of £105m against pre-tax profits of £115m in 1997.

At worse, say industry sources, the review could lead to closure of the Govan yard or even to Kvaerner selling its shipbuilding interests.

At least half of the group’s 12 shipyards throughout the world are making a loss. Last year the Clydeside yard lost £6m on a turnover of £100m.

In a decade under Kvaerner’s ownership, Govan is estimated to have lost £150m, including public subsidies.

Last year Kvaerner turned down a £7.8m Regional Selective Assistance package for improving productivity and facilities at Govan, saying there were too many strings attached to the grant.