Defence firm Babcock International is to close a historic shipyard in Devon, despite a last-ditch £60m offer of work from the government.
The closure of Appledore shipyard, located at the mouth of the river Torridge, near Barnstaple on the north Devon coast, will put almost 200 jobs at risk.
The company will end its lease on the site in March 2019 after 11 years, having failed to find enough work to sustain the yard, which generated revenues of £24m in the last financial year. The yard had recently completed a four-ship order for patrol vessels for the Irish navy.
Babcock, which has a stock market value of £3bn and is listed on the FTSE 250, rejected offers from the government of work which would have taken place at its separate Devonport shipyard, where 140 Appledore staff are on “short-term redeployment” by the firm. Babcock made revenues of £5.4bn in the last financial year.
The defence secretary, Gavin Williamson, wrote that Babcock indicated that the £60m contract was not “enough to secure the long-term future of the yard”, in a leaked letter sent on Wednesday to Geoffrey Cox, the attorney general and local Conservative MP. The closure came after a week of talks between defence officials and Babcock.
Williamson said it remained a “commercial decision” for Babcock.
The 199 employees at the yard will all be offered the opportunity to relocate to Devonport, located almost two hours away by car near Plymouth.
The closure is the latest economic blow for the north Devon community, which has suffered from the gradual winding down of the shipyard as well as the decline of its centuries-old fishing industry.
Unions and staff were informed of Babcock’s decision on Thursday. The firm has begun a consultation period with the workers.
Jake McLean, the representative of the GMB union at Appledore, said the decision was “a devastating blow to the workforce and the local community”.
“We want answers from the government and Babcock about the package that was offered to save the yard,” he said.
The shipyard traces its history back to 1855 and played a part in the shipbuilding effort during the second world war.
Appledore recently played a key role in the new Queen Elizabeth Class aircraft carriers, the HMS Queen Elizabeth and the HMS Prince of Wales. Appledore delivered more than 10,000 tonnes of manufactured components for the ships to Rosyth, in Scotland, for final assembly.
Babcock’s statement said it was a “difficult decision” to close the yard, and said its “focus is now firmly on its workforce and its determination to protect their employment within the business”.
