Unfinished CalMac Ships Now Fully Owned by CMAL
MV Loch Indaal is the most complete of the remaining vessels still under construction at the Cemre shipyard in Turkey and is expected to be delivered soon.
Scotland's publicly-owned ferry authority, Caledonian Maritime Assets Ltd (CMAL), has completed full payment and assumed legal ownership of three CalMac ferries being built in Turkey, despite their unfinished status.
CMAL described this as a "precautionary measure" in response to the economic difficulties faced by the Cemre shipyard.
This unusual step ensures that the ships—MV Loch Indaal, MV Lochmor, and MV Claymore—could still be transported to Scotland even if the shipyard were to fail, although CMAL would need to cover the expenses to complete their construction.
CMAL's chief executive, Kevin Hobbs, expressed disappointment over the situation but stated that this approach was the best way to safeguard the investments already made in the vessels.
Background on CalMac Ferry Contracts
CMAL awarded two contracts totaling approximately £200 million to the privately-owned Cemre shipyard in 2022 and 2023 for four large ferries intended for the CalMac fleet.
The first vessel, MV Isle of Islay, was delivered in January 2024, approximately 15 months behind schedule, and is currently operating on the Kennacraig to Islay route.
The other three ships are at various stages of construction at the Cemre facility in Yalova, located in northwest Turkey, with the second vessel scheduled for imminent delivery.
Payment Structure and Industry Context
Typically, shipbuilding contracts involve staged payments—usually around four installments—made at different construction milestones, with the final payment withheld until the vessel is delivered.
An industry insider told BBC Scotland News that making the final payment early would assist Cemre's cash flow.
"I think the fear will be that if the shipyard collapses, then whoever takes over the yard would take ownership of the ships. They've now taken ownership so that, if needs be, they can float them away and finish them somewhere else."
Cemre has attributed delays in delivering the CalMac ferries to external factors including the war in Ukraine, the 2023 Turkish earthquake, and supply chain disruptions linked to tensions in the Middle East.
The fourth ship has been launched from the slipway but requires many months of fitting-out work before completion.
CMAL's Precautionary Ownership Decision
CMAL stated that the decision to take early legal ownership was made in light of "exceptionally challenging economic circumstances affecting Cemre and many businesses within the region."
"While we are disappointed by the circumstances that have led to this decision, our priority remains the completion of these vessels for the communities that depend on them.
Taking ownership of the vessels at this stage is a precautionary move to reduce risk, protect the investment already made and support our objective of bringing these vessels into service as quickly and efficiently as possible.
We will continue to work closely with the shipyard and partners to maintain progress towards delivery."
Analysis: A Defensive Strategy by CMAL
This action by CMAL is a defensive measure typically taken when there is a significant risk that the shipyard may be unable to complete the vessels under normal circumstances.
If Cemre were to experience severe financial difficulties, its partially built ships could become entangled in claims from other creditors.
By assuming ownership now, CMAL effectively isolates these three vessels as its property, preventing them from being seized if the shipyard encounters problems. In the worst-case scenario, the ships could be towed elsewhere for completion.
However, there is a risk associated with paying months before delivery. Should the shipyard fail and CMAL need to finish the ferries at another location, additional costs could be incurred by Scottish taxpayers.
Government Support and Operational Context
Stephen Flynn, Scotland's Economy, Tourism and Transport Secretary, representing the Scottish government which owns CMAL, endorsed the decision.
"CMAL are working at pace to set out the next steps to ensure the ships are available in the CalMac fleet as soon as possible."
CMAL is responsible for procuring and owning vessels used on the west coast ferry network and leases them to CalMac, which is also wholly owned by Scottish ministers.
BBC Scotland has learned that CalMac has filed approximately 150 warranty claims against Cemre since the delivery of MV Isle of Islay in February.
Despite these claims, CalMac's chief executive, Duncan Mackison, expressed satisfaction with the new vessel.
"She has proven to be a valuable and highly regarded addition to the fleet and we will continue to support CMAL and our partners as we move towards completion of her sister ships."
Comparison with Other CalMac Ferries
The Turkish-built vessels are smaller and utilize a more conventional propulsion system compared to the two dual-fuel ships ordered from Ferguson Marine shipyard in Port Glasgow in 2015.
MV Glen Sannox and MV Glen Rosa, the latter still under construction, are capable of operating on liquefied natural gas (LNG). However, CalMac has opted to operate Glen Sannox solely on diesel since July 2023.
New ferry enters service as CalMac faces 'firestorm' of ship shortages.
