Whilst I am, like everyone, horrified by the loss of life in this disaster I personally feel it is a bit of poetic justice for Costa Cruises. It is only a relatively short time ago that a lot of shipyard workers, and the Company they worked, for lost their jobs at Cammell Lairds shipyard in Birkenhead, England. This was caused by Costa requiring Lairds to build a very expensive centre section for one of their Cruise ships, then refusing to take it for reasons best known to themselves. This caused Cammell Lairds yard to go bust and be left with a large piece of very expensive scrap steel. They say that what goes around comes around. I think that is possibly true, sad, but true.
This is a quote from BBC at the time:-
Wednesday, 11 April, 2001, 20:30 GMT 21:30 UK
Cammell Laird: what went wrong
Cammell Laird has called in the receivers
UK shipyard Cammell Laird has given its version of the events that led to Wednesday's decision to call in the receivers.
In a statement, the Mersyside shipbuilder said its decision followed a series of problems that caused significant damage to its trading and financial position.
In Autumn 2000, the ship builder and repair yard had a record level of enquiries totalling approximately £750m which gave the directors high confidence in the future prospects of the group.
The business had grown substantially reporting pre-tax profits to April 2000 of £15.9m.
Investment was made in employees and infrastructure in anticipation of further growth. But the enquiries did not translate into firm orders, the company said.
Government contracts
In late October, a six ship contract for the Ministry of Defence was awarded to the German shipyard, Flensburger, and Harland and Wolff.
The company claims a further naval order for four large landing craft could not be pursued with any prospect of success due to the Government's bidding process.
The work was awarded to BAE Systems and Swan Hunter, with the result, Cammell Laird claims, that its shipyards were the only major facilities in the country not to benefit from Government orders.
Italian cruise ship
But the biggest impact on the deterioration in Cammell Laird's position was the dispute over the Italian cruise-liner Costa Classica.
The contract involved a £50m lengthening of a cruise ship.
Signed in late summer of 1999, the work involved building a mid-body section for insertion into the vessel between November 2000 and March 2001.
Given the credit worthiness of Costa Crociere, Cammell Laird's confidence in its own technical ability, and the desire to further establish itself in the important cruise ship market, the British company says it agreed to accept a contract with back end payments.
However, the ship's operator, Costa Coriciere, pulled the plug on the order as the ship was sailing to Cammell Laird's yard.
Cammell said it had considered legal action against Costa Coriciere, but has been advised it would take two years for a case to be resolved.
Damaging
Cammell says the Costa dispute has been very damaging to its business.
Apart from the loss of profit on the contract and significant cash outflow, the company says it has suffered the additional costs of downsizing the workforce, carrying excess overhead costs and the significant negative impact on employee morale.
Furthermore, the trade and financial markets have begun to doubt Cammell Laird's financial viability, which, combined with media speculation, has damaged the company's trading and financial position.
