Relations between the Greek government and the German management of Hellenic Shipyards, controlled by Thyssen Krupp, seem to be taking a turn for the worse. The apple of discord has been a submarine built at the behest of the Hellenic Navy which, according to the goverment, presented serious technical problems during tests. Negotiations under way since last October have led nowhere and the two sides seem to be hardening their stances. Reinhard Kuhlmann, the president and CEO of Hellenic Shipyards, accused the Hellenic Navy at an informal meeting with reporters yesterday of being an unreliable customer, claiming it has refused to pay a sum of about -230 to 240 million for the cost of the construction of new submarines as well as the modernization of old vessels. He said this sum will rise to -460 million by September. «This may not be a significant sum for the Greek government, but for the company it is five times the size of the workers’ annual payroll,» he said. Kuhlmann disputed the claim of technical problems in the submarine, saying instead that the navy had asked for modifications after the contract was signed. Finally, Kuhlmann defended the recent layoff of 12 workers as part of a modernization drive to make the facility among the most competitive in the Mediterranean. The shipyards, he said, plans to hire 25 other, more highly skilled staff who will improve the facility’s know-how.