The Scottish Government has confirmed that Ferguson Marine will remain in public ownership for the foreseeable future, with officials stating that key milestones need to be met before any consideration is given to returning the shipyard to private hands.
“Now is not the appropriate time,” said Gregor Irwin of the Scottish Government during the Public Audit Committee meeting on 5 February 2025. “Glen Rosa needs to be completed and delivered, and we need to find new work for the yard.”
Irwin reiterated that the eventual goal remains a return to private ownership but noted that the yard must first stabilise its operations.
“We need to get this right, and, at some point in the future, we will be able to identify the appropriate time when we will be able to consider, once again, a market testing exercise,” he added.
Optimism Amid Ongoing Challenges
Despite the delay in returning to private ownership, Ferguson Marine executives expressed optimism about the yard’s future, citing a pipeline of potential contracts and long-term growth opportunities.
Andrew Miller outlined the company’s current strategy, including a mix of short- and long-term deliverables that could generate more work than the yard can comfortably handle. “That market calculation over 10 years is well in excess of £500 million,” Miller explained, though he acknowledged that not all opportunities are guaranteed.
Miller also confirmed that a significant contract is expected to be signed by March, and discussions are underway for additional contracts. “We would definitely like to deliver some good news in the next six months,” he said.
One key challenge discussed during the session was the intense competition from overseas shipyards, which often offer lower prices due to differences in labour costs and regulations. Jamie Greene, Conservative MSP for West Scotland, raised concerns about Ferguson Marine’s ability to compete on price alone. He asked whether the Scottish Government should consider the wider economic benefits of supporting domestic shipbuilding in Inverclyde.
Miller agreed, emphasising the importance of recognising the broader value of local shipbuilding. “Yes,” he responded when asked if the government should account for the macroeconomic impact of awarding contracts to the yard.
The yard’s experience with dual-fuel LNG vessels, such as the Glen Sannox and Glen Rosa, was highlighted as both a challenge and an opportunity. John Petticrew, head of Ferguson Marine, rejected the notion that the vessels were overly complicated. “Everybody keeps calling it a complicated vessel. I keep correcting them and saying that it is not; we just did not plan it right,” he said.
Petticrew stressed that the yard is capable of building such vessels but needs to improve its planning and design processes. “We need to get back to working on a series of vessels, so that we can put the lessons learned into practice,” he added. He described the dual-fuel expertise gained from these projects as a valuable asset that could be marketed to future clients.
Jamie Greene also sought assurances that future cost overruns, particularly those related to the Glen Rosa, would not divert funds intended for infrastructure improvements. He noted that past instances saw funds meant for capital investment being used to cover overruns.
Irwin acknowledged the concern but stated that any decisions regarding additional funding would be made by ministers. He pointed to the government’s ongoing commitment to the yard, subject to the results of commercial due diligence.
While Ferguson Marine remains publicly owned, its leadership and government officials are optimistic about the shipyard’s long-term future. With potential contracts, strategic diversification, and lessons learned from past challenges, the yard aims to stabilise operations and eventually return to private ownership.
As Irwin noted, “We will, of course, retain the ability to respond to opportunities should they emerge, but now is not the time. The yard must first deliver on key milestones.”
In other words, it is worthless.
Nobody would take it, even for £1.
Not even for £1.
Any buyer would want a TUPE guarantee as well as a pensions guarantee.
It is a dreadful tight little site with little capacity for expansions.
You look at BAE Govan and Rosyth where there are rows of dry docks, slipways and hard standing….to me it is a no brainer unless there is a pipeline of work for small vessels.
The workforce will be welcomed with open arms at BAE or Babcock or if they fancy relocating H&W. Plenty of need for the skilled labour.
Relocate to inchgreen?