August 25, 2003

Redundancies at Kvaerner Philly
Kvaerner Philadelphia Shipyard is starting to cut jobs and more cuts are on the way.

In its latest quarterly report, Aker Kvaerner notes that a "thorough review carried out in connection with the commissioning of Kvaerner Philadelphia's first containership in the second quarter revealed higher costs and lower productivity than previously expected."

Delivery of the ship was delayed from the end of June and is now expected in early September.

"Following the review, the yard increased its cost estimate for the three containerships under construction. To reflect this, Aker Kvaerner booked a NOK 440 million charge in the second quarter accounts," says the company.

Aker Kvaerner says it "acknowledges that the substantial commitment made to turn Kvaerner Philadelphia into an efficient and commercial yard has not so far given the desired results. Revised plans are being drawn up, aiming to further strengthen the yard's capabilities within project management, procurement and construction management. Overhead costs are being reassessed again, and staff has been notified about future redundancies."

One Marine Log source says that some 25 engineering and administrative staff lost their jobs last week and that cuts in the design department are imminent.

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