Scilly ferry shipbuilder choice a scandal - union

French shipbuilder Piriou said it would have the ferries built in Vietnam

Plans to build the Isles of Scilly's two new ferries in Asia have been described as "an absolute scandal".

The Isles of Scilly Steamship Group (ISSG) awarded the £42m contract to Piriou, a French shipbuilder, which said it would build the ferries in Vietnam.

The workers' trade union, GMB Union, said that shipbuilders in the UK have been "hugely let down" by the ISSG's decision.

Harland and Wolff (H&W), which owns Appledore shipyard in Devon, was shortlisted but not chosen.

'Hugely let down'

Matt Roberts, GMB national officer, said: "It’s an absolute scandal – instead of building these ferries at a proud UK shipyard, in the heart of a community that needs the work, they're being built on the other side of the world.

“Shipbuilders of the South West have been hugely let down by the government and the Isles of Scilly Steamship Group."

Last year H&W proposed to replace and run the ferries using government Levelling Up funding, but was unsuccessful.

In May, H&W says it is launching a rival ferry service between the islands and the mainland.

A spokesperson for ISSG said H&W lacked recent experience in such projects and, from a financial perspective, choosing Appledore was "far too much of a risk".

The ISSG has commissioned Piriou to build a new freight and a new passenger ferry to commute between St Mary's and Penzance.

The passenger ferry operating currently was built in Appledore and both ferries are now in need of replacement.

'A risk'

The ISSG said the main reasons for not awarding the ferries contract to H&W were "lack of recent experience in building technical vessels, inability to offer a refund guarantee and a much higher overall cost."

"We also had to consider Harland and Wolff’s financial stability," a spokesperson said.

"The audit opinion in Harland & Wolff’s most recently published full year accounts was that ‘a material uncertainty exists that may cast significant doubt on the group’s ability to continue as a going concern.’

"From this perspective, choosing Appledore was far too much of a risk."

'Devastating for shipbuilding'

John Wood, chief executive officer of H&W, said the decision to have the ferries built in Vietnam was "devastating for the UK shipbuilding industry".

He said the UK offered "build superiority" that had a greater cost but that future costs in repairs and downtime made that cost "compelling".

H&W has a backlog of more than £1bn in contracted revenues, he said, and its revenue was forecast to double from £80m to £100m in 2023, to £200m in 2024.

In January, Defence Secretary Grant Shapps said he was "dismayed" by ISSG's decision.