Harland & Wolff's difficulties come at a time when shipbuilding is entering a boom period worldwide. Up to 30 cruise ships are expected to be ordered in the next few years and fewer than 10 yards worldwide have the capability or expertise to build them.
There has even been a turnaround for British shipyards in recent years. After decades of decline, the number of people employed in the UK shipbuilding industry has grown by about 1 per cent in three years to an estimated 26,500.
According to Mr Nick Granger, director of the UK-based Shipbuilding and Ship Repairing Association, most of these increases are in specialist areas and in repairing ships rather than ship-building.
He said only a few yards, such as Harland & Wolff and the Govan shipyard on the Clyde, are capable of completing an order the size of the Queen Mary II.
"The problem Harland & Wolff had was that they lost several of their clients at the wrong time," said Mr Granger.
The Belfast yard's bid for the Queen Mary II project was a deliberate attempt to diversify its business as orders for the type of heavy, drill ships it has built in recent years began to dry up.
However, the last cruise liner the yard built was the Canberra in the early 1960s, and the expertise required to outfit a floating hotel is quite different from the heavy steel work required on a drill ship.
This lack of experience in building cruise ships, compared to the French yard, Chantiers de L'Atlantique, is certain to have influenced Cunard, which was always unlikely to take a risk with its flagship project, the Queen Mary II.
Harland & Wolff was also disadvantaged by the fact that sterling was outside the euro zone. The French shipyard benefited significantly due to the weakness of the euro.
Chantiers de l'Atlantique could quote a lower bid and yet cover its costs due to the favourable exchange rate with the dollar. In contrast, Harland & Wolff was saddled with costs in sterling. It is ironic, though, that Harland & Wolff could go into receivership at a time when the shipbuilding market is experiencing a boom and as the British government is showing renewed interest in the maritime industry.
Deputy Prime Minister and former merchant seaman Mr John Prescott is keen to rebuild the industry.
Shipbuilding lies within the aegis of the Department of Trade and Industry and the Minister, Mr Stephen Byers. In 1998 the department set up a shipbuilding forum to help the industry find new markets and commercial opportunities. However, European law restricts a domestic government from offering more than a 9 per cent subsidy.
This has been a constant gripe of European shipyards, which have been under serious competitive pressure from the far east since the late 1970s.
A European Commission report published in 1983 shows orders within the EC fell to a record low of 11 per cent that year. In contrast, Japan and South Korea accounted for 64 per cent of the world market in 1983, up from 50 per cent on 1982.
This decline in shipbuilding was a Europe-wide phenomenon. During the mid-1980s, Harland & Wolff won several contracts but failed to make profit and largely relied on state aid. This made diversification from shipbuilding necessary to keep the yard in business.
The Republic did not escape the slump either. The Dutch company Verholme, which employed over 1,,000 people at Cork shipyard, was forced to close in 1984.
Mr Granger blames the South Koreans for the decimation of the European industry. "We have presented evidence to the European Commission that the Koreans are not only not making profits but aren't even covering their costs," said Mr Granger.
But strong demand in the next few years is likely to create opportunities for European yards. The question is, will Harland & Wolff stay afloat long enough to compete for orders.