As one of the “PIGS” of Europe, the Irish economy is clearly suffering. The headline figures say it all:-
- Retail sales index down 7.5% (Dec 09 v Dec 08)
- GDP down 7.4% (Q3 09 v Q3 08)
- Unemployment up by 13K (Jan 10 v Dec 09)
- Interestingly, the Retail Sales index is down 7.5% but transport costs are up 3.5% (over the last 12 months) ?
So how does the Irish ferry industry cut its cloth during this recession ?
First of all went the “extra” weekend services. Most long sea ferry operators such as Stena Line, Norfolk Line (awaiting competition commission approval to be bought by DFDS), Seatruck and P&O cut these services 18 months ago. In simple terms, there was sufficient ferry space to cope with the demands during mid week, without a requirement to have “extra weekend” sailings.
Secondly, 12 months ago weekend schedules were cut, removing Sunday and Monday morning long sea departures (with the exception of Norfolk Line Heysham routes). Ferries operating on these routes were allowed much needed maintenance downtime whilst also allowing the ferry operators to cut the fuel costs. Its worth noting at this point that most other costs such as charter costs, manning levels, berthing costs, generator fuel costs, water charges & sewage pumping costs continue even if a ship is berthed !
Some operators such as Norfolk Line and Seatruck were fortunate enough last year to shed some of the old unreliable costly freight tonnage, and replace it with newer larger, more economical ships. Ships like the Saga Moon capable of carrying 50 unaccompanied trailers and 12 driver accompanied units, made way for the Maersk Exporter / Maersk Importer and Maersk Anglia capable of carrying 110 unaccompanied units plus 12 drivers. Case example Norfolk Line Heysham to Dublin route, 1 vessel took the place of 2 !
What next ?
There are still 3 “shoulder” services (dep to Ireland 0100hrs to 0400hrs / dep from Ireland 1300hrs to 1600hrs) in play on the long sea rotes as we speak. Stena Line’s Fleetwood to Larne 0300hrs, Seatruck’s Heysham to Warrenpoint 0100hrs, and P&O’s Liverpool to Dublin 0300hrs.
These ships operate roughly the same schedule circa 8 crossings per week Tuesday to Friday, 1 crossing per day in each direction. However, as the demand for consumer goods in Ireland continues to slow, how long will these services continue ?
Seatruck’s Heysham to Warenpoint can be almost discounted as a serious contender. With the ship charter market at a low, there simply is not the demand for this ship in the market place. It would appear the 3rd ship is in service rather than sit on a berth, costing almost the same to operate, less the fuel costs. If a sensible charter arrived for the Arrow it would make good business sense to remove the service. With 1 or 2 extra sailings, the existing 2 new 120 unit ships the Clipper Point & Clipper Panorama are more than capable of carrying current cargo levels.
However, P&O’s Liverpool to Dublin (Celtic Star) and Stena Line’s Fleetwood to Larne (Stena Seafarer) 3rd ship, is a very different proposition. Both companies have aggressively sold their respective services over the last few years, making a big sales feature of their respective 0300hrs west bound & 1400hrs east bound departure. Both operators have said the service is here for the long term. These appear to be bold statements to make in a shrinking market.
Will these 2 services last the distance ?
Volume is vanity, profit is sanity ! It all depends how desperate P&O and Stena Line are to maintain volumes in these extra ordinary times when 2 ships can probably carry the volume of 3 ships !
If the services were removed, with so much spare ferry capacity in the market place, the average haulage contractor wouldn’t notice a difference in service levels. It could well also benefit the ferry operators directly and maybe even other ferry operators as this would surely “sure up” rates across all Irish long sea ferry services.
Like most things in life, time will tell.
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