UPDATE 27.04.20: FSG’s management team see the yards future in series Ro-Ro freight ferry production. What this means for the remaining Irish Ferries order is correctly unclear. Click on the link to find out more.
German shipbuilder Flensburger Schiffbau-Gesellschaft filed for self-administered insolvency earlier today at the local court in Flensburg. The district court has confirmed the move to NDR Schleswig-Holstein. The shipyard, which has been operating at a loss for some time, currently has two orders on its books. The first of the two vessels, Brittany Ferries HONFLEUR, is in the fitting out stages. Construction does not appear to have started on the second ship, a new-build for Irish Continental Group subsidiary Irish Ferries. This was due for delivery at the end of this year. It was recently confirmed that HONFLEUR, which was originally expected to be in service last summer, will not be delivered this year either. If the ship was to be delivered next Spring as planned she will be over 18 months late.
Huge losses
The self-administered administration process has been initiated in order to allow the yard to start afresh. IG Metall union representative Michael Schmidt views the move as positive. He also commented that the yard has the potential to start building standardised freight vessels again. It is noteworthy, however, that the yard was previously losing money while constructing these vessels, not least due to competition from shipyards in the Far East. FSG moved into Ro-Pax ferry construction with W.B. YEATS in order to improve margins. The result was the opposite, however, with the yard posting huge losses.
Problems with the construction and subsequent late delivery of W.B. YEATS made these losses much worse. The yard also recently lost its flagship order worth almost half a billion euro from the Tasmanian Government for two new ferries for TT Line Tasmania. This was cancelled by mutual consent. The Tasmanian ferries will now be built in Finland instead.
New MD
Martin Hammer has been appointed as the new Managing Director. He previously held a similar position at P+S Werften, a shipyard in Mecklenburg-Western Pomerania which went bankrupt in 2012. The shipyard’s owner Tennor Holding, which is controlled by investor Lars Windhorst, has so far declined to comment. Mr Windhorst is expected to be present when a restructuring plan is presented to workers on Sunday according to the NDR report. Production at the yard is currently suspended due to the COVID-19 Coronavirus crisis, but many of the yard’s workers were already on the German short-term work scheme before the crisis began. The scheme allows workers which are not required to be sent home and paid by the state.
Industry publisher Shippax say that they understand that Irish Continental Group has already approached several other yards about building their giant new Dublin – Holyhead ferry instead. Previously it had been rumoured that the company had been investigating the possibility of building the vessel in China or elsewhere. The company have not yet publicly commented on the possibility of the ship being built anywhere other than FSG, however. A 20% down payment for the ferry, the purchase of which was to be part-funded by the European Investment Bank, has already been made by ICG. It is not yet clear how the insolvency process will affect the yards existing orders.
