At first glance, Chantier Davie Canada Inc. may look like a business. It’s got an operating shipyard in Levis, Quebec, multi-million-dollar contracts with the federal and Quebec governments and about 1,400 employees.

In fact, it’s a corporate zombie, which for decades has drifted in and out of financial ruin and has been kept alive solely through government contracts awarded for reasons of politics and regional development.

Over the decades, the shipyard has been owned by a dizzying array of backers, including Power Corp. of Canada, Dome Petroleum, the Quebec government, SNC-Lavalin and many more obscure ones. They quickly realize that shipbuilding isn’t a sustainable business in Canada — and when the government contracts run out, they bail.

Politics has always played a key part in Davie’s existence. Back in the 1980s, Davie was part of a bizarre contract-splitting arrangement with shipyards in Montreal and Sorel, which shared the construction of three naval frigates, while nine others were built by the Irving family’s shipyard in Saint John, New Brunswick. Half-completed ships were hauled up and down the St. Lawrence River so that the maximum number of jobs could be maintained, at a massive cost to taxpayers.

Despite the work, Davie’s parent at the time, Groupe MIL Inc., only survived due to a $363 million bailout from the Quebec and federal governments. Ottawa didn’t want Davie to close because it was worried about rising Quebec nationalism in the aftermath of the failure of the Meech Lake accord. The two other Quebec shipyards eventually were shut down. Davie somehow survived.

The following 20 years weren’t much better and, in 2011, it looked as if Davie would finally bite the dust. The company, which was on the verge of collapse, got shut out of the $35 billion shipbuilding procurement decision made by the Harper government, with most of the spoils going to Irving’s Halifax Shipbuilding and to Seaspan in Vancouver. The Irvings had long since closed their shipyard in Saint John when the original frigate work dried up and moved to Nova Scotia, getting the provincial government to front much of the money to build a new state-of-the-art facility.

That procurement decision was dressed up as apolitical, with a committee of deputy ministers supposedly making the choice — but these bureaucrats knew all along what the right answer was going to be. For the Conservatives, giving the lion’s share of the contract to Nova Scotia was politically convenient and they quickly took credit for it (although all that effort didn’t help them a bit at the polls in the 2015 election).

But once again, Davie didn’t die. It emerged from bankruptcy protection in November 2012 and is now owned by a mysterious group led by a Briton based in the tax haven of Monaco along with companies from Virgin Islands and elsewhere. Who, exactly, are the beneficial owners? That’s unclear, despite The Globe and Mail‘s efforts to find out. And that’s not exactly reassuring, given this is a company doing work for the Canadian military.

The Davie-leased supply-ship could have been bought for half the price from a shipyard in South Korea — where shipbuilding is actually a competitive business, not a method of distributing political pork. The Davie-leased supply-ship could have been bought for half the price from a shipyard in South Korea — where shipbuilding is actually a competitive business, not a method of distributing political pork.

With its new owners, Davie got back to doing what it does best: snookering governments into giving it big contracts to save jobs and supposedly build a robust shipbuilding industry in Quebec. The Quebec provincial government signed a sole-source contract to build two car ferries for $125 million. They were supposed to be operational in 2013 and 2014, then in 2015.

Guess what? Neither of the ferries is completed and there’s now talk of a cost overrun of up to $100 million. Things got so bad last year that Davie actually stopped building the ferries and laid off 200 workers, only agreeing to hire them back when Quebec handed over a $20 million advance. Then last December, facing another threat from Davie, Quebec handed the company an additional $14 million interest-free loan.

Things haven’t improved since. Quebec’s transport minister recently admitted to finding the situation “very frustrating.” There’s even talk of taking the ferries offshore to be completed.

Davie’s new management also got to work on the feds. When the Royal Canadian Navy found itself without a functioning supply ship after a fire on its own ancient vessel, HMCS Protecteur, Davie convinced the Harper government to give it a sole-source contract to supply it with an oil replenishment ship. Nice work if you can get it.

The contract, valued at more than $500 million, was announced with great fanfare in the summer of 2015, a day before the federal election was called. The Levis shipyard is in the riding of Steven Blaney, then a Harper minister, and the Conservatives had hoped to build on their electoral base in the Quebec City region.

Rather than build a ship from scratch, Davie bought an old container vessel and promised to refit it and lease it to the feds. The idea was to create jobs in Quebec but, as The Globe and Mail discovered, the whole super-structure has been built in Finland because Davie wasn’t able to do the work in time. The seven-storey structure is being transported by tug from Finland to Levis, where it is to be attached to the old container ship.

The Irvings, who were getting used to the idea of having a lock on the shipbuilding industry in the East, hated Davie’s supply ship deal and lobbied their Liberal friends after the Trudeau government got elected to stop it, claiming it was too expensive. That’s allegedly when Vice Admiral Mark Norman got involved.

Norman, who used to be vice-chair of Canada’s defence staff, is alleged to have leaked confidential government documents to Davie to pressure the Liberals to keep the supply-ship contract. Norman has since been suspended for his role in the affair and an RCMP investigation has been launched.

In the end, the Liberals figured it would be expensive to kill the supply-ship deal, so they agreed to let it proceed. The Finns must have been happy.

In the end, Quebec probably will end up paying tens of millions of dollars more to Davie for ferries that they could have bought elsewhere. As for the feds, shipping officials told The Globe that the Davie-leased supply-ship could have been bought for half the price from a shipyard in South Korea — where shipbuilding is actually a competitive business, not a method of distributing political pork.

As for those who worry that Canada needs its own facilities to build defence equipment, like frigates — that’s certainly not the case with supply ships and car ferries. And as for the frigates to be built in Halifax, it has been decided already to buy an existing design from a foreign defence supplier like BAE of the U.K. It’s as if the government decided to get a car assembly plant built every time it needed a new fleet of vehicles for the RCMP.

Dare I hope that someday, our governments will treat ship procurement like a real competition? Why not put out an international tender for a supply ship or a ferry, and let Davie line up with competitors from South Korea or Poland? Why not let the most reliable low-cost producer win the contract?

If turns out to be Davie, I’ll be the first to cheer. If not, maybe they should get into another line of work.

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