Packet won’t say if it will stop cuts

0
Have your say

THE Steam Packet should look again at its decision to cut Irish sailings.

That’s the view of Speaker Steve Rodan, who chaired the Tynwald select committee that produced a damning report in 2008 criticising the ferry operator’s ‘excessive’ profits and high freight charges.

Reviewing its services in the wake of Mezeron’s launch of ferry freight competition, the Steam Packet announced that the Snaefell would no longer be part of the fleet and there will be 11 fewer sailings to Ireland annually.

Mezeron ended its cargo freight service to Liverpool at the weekend after less than four months, with parent company Dohle admitting it had not achieved the growth needed to continue to operate profitably,

But the Steam Packet, while welcoming an end to competition, has so far refused to comment on whether the proposed cutbacks to services would now go ahead.

A spokesman said: ‘The Steam Packet Company has no further comment to make at this stage about its services following Mezeron’s announcement regarding it ending its freight service.’

Mr Rodan said: ‘I would expect, and the travelling public I think would expect, some revisiting of the decision to cut back on the Irish sailings.’

The Steam Packet lost 15 per cent of its freight business when Mezeron launched its direct service to Liverpool in October, using two chartered Estonian-registered vessels, the Kalana and the Kurkse.

With haulier Graylaw jumping ship to Mezeron, the Steam Packet lost a lot of trade from two of its biggest customers, Tesco and Shoprite.

In December it emerged that the Packet has responded to new competition in an unexpected way – by increasing freight rates by 4.5 per cent.

But it is understood that customers were told that rates for certain types of trailer were to be cut dramatically to try to win back some of the lost business.

While rates for flat trailers were to go up by Manx inflation, rates for curtain-sided and box trailers could have been reduced by as much as a third.

Mr Rodan said: ‘There may be no commercial scope for them to reintroduce these passenger services. But it is really for them to state their intentions.’

Following its review, the Steam Packet said the Snaefell would be chartered out or sold off. It has since been advertised for sale on the Mondial Broker website for an undisclosed sum.

The larger fast craft Manannan will cover the Belfast and Dublin routes and there will be 11 fewer sailings to Ireland. Some 29 fewer staff will be employed as a result.

At the time Mark Woodward, the Steam Packet’s chief executive, said the company was reviewing sailing frequency and fares ‘as a result of increased freight competition’.

Mr Rodan said Mezeron’s short lived experiment had showed that while the user agreement doesn’t prevent competition, there is only limited scope for competition with the volumes of freight in the current market.

‘But that could of course change,’ he said.

‘The number of customers Mezeron had were clearly not sufficient to make the operation commercially viable. Had they attracted more freight customers, things might have been very different.’

Mr Rodan said the episode had shown there was a lot of loyalty to the Steam Packet and people had woken up to the fact that its passenger business was wholly dependent on the revenue from its freight operation.

Back to the top of the page