Cebu-based shipbuilder plans $20 M expansion

MANILA, Philippines — Shipbuilder Austal Philippines is spending $20 million to expand its facility in Cebu which would allow the firm to build more ships and other large vessels.

Austal marketing manager Paul Sparke said on the sidelines of the 6th Philippines Marine event yesterday the $20 million expansion would allow the firm to construct larger ships and make the Cebu facility the second biggest in the shipbuilder’s network, next to the US.

“We would be able to construct vessels up to 120 meters long,” he said.

Austal decided to expand the facility in Cebu due to demand for commercial ships based on orders being placed with the company.

“We have demand globally to build high-quality, cost-effective ships and the Philippines has shown they can build for high Austal standards cost effectively,” Sparke said.

Construction works for the expansion of the Cebu facility which started last year are expected to be completed by next month.

Austal’s expansion is timely as it is vying to build vessels for the Philippine Navy which invited companies to provide bids earlier this year.

The company has expressed interest to build six offshore patrol vessels (OPV) for the Philippine Navy as part of the Armed Forces of the Philippines’ modernization program.

“Now, with a license to construct naval vessels recently issued, the shipyard is ready to deliver major naval projects such as the OPV for the Philippine Navy,” Austal Philippines president Wayne Murray said.

Sparke said it would take about 18 months to two years to build the first ship, while the rest could be completed in a shorter period of time.

He said the Cebu shipyard gives Austal an advantage over other firms looking to provide vessels for the Philippine Navy such as German shipyard Lurssen and Dutch company Damen, which would be constructing most of the vessels overseas.

“It is better for the Philippines and the Philippine Navy to be getting your ships here, servicing them here. Another point to make is we will be able to service in the Philippines. We don’t need to send them off to other countries to be able to service,” he said.

Should Austal win the contract to supply to the Philippine Navy, he said the company would increase its workforce to more than 1,000 from around 900 at present.

Prior to the expansion, Austal’s facility in Cebu employed around 500 to 600 workers.

To date, Austal Philippines has delivered 17 ships, with 15 exported to the United Kingdom, French Polynesia, United Arab Emirates, Germany, South Korea, Spain and Norway.

Locally, Austal Philippines has constructed two 30-meter catamarans for the 2GO Group Inc.

Austal started its operations in Cebu in February 2012.

Aside from the Philippines and the US, Austal has shipyard facilities in Australia and Vietnam, as well as service centers in Australia, Singapore and the Middle East.