The critical roles of both processes for market competitiveness are clear, as their volume will influence expectations for supplier loan collections and, where relevant, the anticipated provision of labor services. In the ongoing dispute involving Havila Kystruten and Naviera Armas at the Vigo shipyard, the administration report from Hijos de J. Barreras, overseen by Tahice Legal, confirms that both proceedings add a combined 70 million euros in claims.
The completion of selling the manufacturing unit to Grupo Armón stands to inject a little over ten million euros into the Barreras fund after compensating about one hundred workers affected by the ERE and enabling ordinary, fully funded loans. Unpaid invoices totaling 9.6 million euros mainly relate to the two contested contracts. The concern is the real likelihood that the workers will be left without redress. On July 11, the United Kingdom’s High Court will determine whether Havila is in the right, and whether the Vigo shipyard must repay 36.8 million euros plus interest and 20 million euros to the Norwegian shipping firm for the two ships not accepted. There are 40 days remaining in the timeline.
Maessa, a subsidiary of the ACS group, was hardest hit by delays in steelwork payments on Buildings 1710 and 1710, previously destined for cruise ships Pollux and Polar Bear. Barreras accuses Havila of breaching the contract by failing to provide a financing plan and by delaying payments, which left both constructions idle since July 9, 2019. The Scandinavian shipping company responded with a preliminary accord. The Russian state agency GLTK added a further ship to the dispute, halted from sailing due to sanctions on the Kremlin. The ship designs required adjustments because of excess weight; each vessel carried about 1,100 tons more than calculated, increasing draft and preventing entry into several ports along the Bergen-Kar vs route. Havila maintains that the shipyard violated the agreement and paid roughly 37 million euros for an order that was not fulfilled.
Initially, the shipping company led by Per Sævik filed the case against the insurer rather than Barreras. A victory would have compelled Abarca to seek a bailout for the company. The situation shifted when Douglas Prothero, then head of the shipyard, completed a Ritz-Carlton Yacht project that contributed to the subsequent liquidation and filed his own suit against Havila in November 2020. At that moment, Barreras, not Abarca, emerged as the main target of the Oslo court actions. Among the company’s principal Vigo creditors is the British law firm Holman Fenwick Willan, holding a loan of about 320,000 euros, which also acted as Prothero’s legal team.
Given the uncertainty surrounding the litigation outcome, more than ten million euros – with Armón set to pay a total of 14.7 million for the facilities – will remain in Barreras’ coffers after settling the ERE obligations. It remains to be seen whether these funds will be transferred to Norway or distributed among the more than one hundred marine suppliers and their workers affected by what is described as the fifteenth bankruptcy in the sector.
Orders are getting more expensive than they were twenty years ago
A container ship with a capacity of 15,000 TEU now costs about 50 percent more than a year earlier. Analysts at Clarkson Research, the leading authority in shipbuilding metrics, note that construction costs are rising at the fastest pace seen in two decades. They expect a slowdown only later, even as material prices like steel and electricity stay elevated. China’s dominant shipping industry has started this year facing not only higher costs but also tighter restrictions that curbed demand. A 45 percent drop in new orders occurred between January and April. Nevertheless, most of the shipyards, largely controlled by the state-backed CSSC group, remain globally influential and largely insulated from immediate disruption.