Minister flags concern over BC Ferries’ deal with Chinese state-owned shipyard

British Columbia’s transportation minister has raised concerns with BC Ferries about its decision to have a Chinese shipyard build four new ferries for its passenger fleet, amid an ongoing trade conflict between Canada and China.

The winning bidder on the contract announced Tuesday is Chinese state-owned China Merchants Industry Weihai Shipyards.

Mike Farnworth said in a statement he was worried about procuring services from “any country that is actively harming Canada’s economy” with tariffs and protectionism.

“BC Ferries is an independent company responsible for its own operational decisions. While BC Ferries has made its decision to purchase new vessels offshore, I am disappointed more involvement from Canadian shipyards was not part of the contract,” he said.

Farnworth’s office declined a request for an interview.

The minister’s remarks came hours after the announcement by BC Ferries CEO Nicolas Jimenez that the Chinese shipyard had been chosen to build its vessels, with the first expected to come into service in 2029 and the others following in six-month intervals.

Jimenez said he wasn’t worried about geopolitical tensions between Canada and China, adding his primary focus was getting the province a good deal.

“Customers expect us to go source the best possible deal, (the) highest quality, a yard that provides safety, a yard that provides the highest in standards when it comes to oversight (and) labour, and to get the best cost,” he said at a news conference Tuesday.

“When it comes to things like trade policy, industrial policy, geopolitics, I think we would really defer that to the federal and provincial governments and expect them to manage and work those issues.”

He said in a news release that the shipyard was “the clear choice based on the overall strength of its bid.”

It said Weihai Shipyards has built vessels for Canada’s Marine Atlantic ferry company and other operators such as Corsica Linea and Brittany Ferries of France.

Canada and China are engaged in a trade dispute, with Beijing imposing retaliatory tariffs on Canadian canola and meal, peas and seafood after Ottawa slapped levies on Chinese-made electric vehicles, steel and aluminum.

Jimenez said Tuesday that there are currently no tariffs associated with the import of vessels of this type into Canada and tariff disputes didn’t factor into the decision.

The publicly funded BC Ferries is not releasing the value of the contract, other than Jimenez saying it fits within the budget approved by the BC Ferries Commissioner earlier this year.

He said releasing the deal before the project is complete could put future procurements at risk.

“To protect BC Ferries and our customers, we’ve structured the contract in a way that reduces our risk while increasing shipyard accountability. Most of the payment is tied to delivery, and that means the shipyard doesn’t get fully paid until the vessels are delivered and meet the rigorous standards that we’ve laid out in the contract,” he said.

“There are also measures like refund guarantees and fixed price terms that will further protect BC Ferries and our customers.”

BC Ferries’ head of fleet renewal, Ed Hooper, said no Canadian companies bid on the ships that will carry about 52 per cent more passengers and 24 per cent more vehicles than the ferries they are replacing.

When the request for proposals was issued last September, Canadian shipbuilder Seaspan said in a statement that “Canadian shipyards and their supply chains cannot compete with low-wage countries that have lower employment standards, lower environmental standards and lower safety standards than Canada and B.C.”

Seaspan said in a statement Tuesday that it was currently building ships for the Royal Canadian Navy and the Canadian Coast Guard at its North Vancouver shipyard.

“We look forward to exploring how this capability can be leveraged to build future B.C. ferries here at home, and therefore generate the strategic industrial and significant socio-economic benefits associated with capital projects of this nature for British Columbians.”

Jimenez said 60 per cent of the world’s ships are built in China, and BC Ferries did due diligence to make sure it understood the “technical and delivery and country risks associated with making this decision.”

Hooper said the procurement process included teams of experts to evaluate bids from around the world on 30 different criteria and the top bidders were also visited in person.

BC Ferries said it will have its own team of experts on-site at the shipyard throughout construction to provide oversight and quality assurance.

In a statement, the Opposition BC Conservatives accused Premier David Eby of “abandoning Canadian workers” by awarding a “multibillion-dollar” contract to a Chinese state-owned enterprise.

B.C.’s aging fleet of ferries has faced lengthy, and costly, sailing delays and breakdowns in recent years.

Last year, the 61-year-old Queen of New Westminster was out of service for nearly 200 days after a mechanical failure, which Jimenez said cost $5.5 million in unplanned repairs and $8.5 million in lost revenue.

“Replacing the ships now ensures that we’re set up to avoid service disruptions that are going to impact communities up and down our coast,” he said.

Along with the Queen of New Westminster, the Queen of Cowichan, Queen of Alberni and Queen of Coquitlam are also being replaced. Those ships all turn 50 next year.

BC Ferries had hoped to buy five new vessels and bring its major fleet size from 10 to 11 but earlier this year the provincial regulator rejected the pitch, saying a fifth large ferry “is not in the public interest” as it is “not essential for safe and reliable service and is not fiscally prudent.”

The parent company of China Merchants Industry Weihai Shipyards is China Merchants Industry Holdings.

The conglomerate’s website describes it as a “centrally administrated state-owned” enterprise with more than a 100 years of history, making it one of the oldest “Chinese-funded enterprises” in existence.

The website says the company is based in Hong Kong and operates nine major shipyards across the Chinese coast as well as overseas subsidiaries and agencies in countries such as Finland and Germany.

This report by The Canadian Press was first published June 10, 2025.

Ashley Joannou, The Canadian Press