FERRY NEWS: Ferry Operators Start to See the Light at the End of the Tunnel
Interferry CEO Mike Corrigan reflects on the crushing impact of COVID-19…but suggests that the gradual easing of travel restrictions offers a turning point on the road to recovery.
Last year the ferry industry was riding the crest of a wave. In an end-of-year review, I went so far as to express my belief that the industry had rarely if ever been in such good health. Throughout the developed world, most operators were reporting year-on-year traffic growth and many had set new records for passenger and vehicle volumes. Meanwhile rising demand was being met by a flurry of newbuild orders everywhere from North America to Asia, Australia and Europe.
But that was then…before everything turned upside down in the past few months as the COVID-19 pandemic swept through all sectors of society with devastating impact on human and economic well-being.
Until then, the worldwide ferry industry was carrying more than two billion passengers per year—much the same as the global airline total—not to mention 250 million personal vehicles and 40 million trucks and trailers. When governments around the world banned all but essential travel as part of their ‘lockdown’ pandemic response, most remaining ferry traffic was confined to maintaining lifeline deliveries of food and other essential supplies. This continued despite companies knowing they were losing money at an escalating and unsustainable rate because passenger carryings—a crucial revenue source—were virtually nonexistent.
The resulting decline in traffic has been put at between 75-100%, with enormous strain on liquidity. State aid to sustain vital services has been forthcoming from certain governments, although this prompted reservations from some operators, who argued that such emergency measures could lead to unfair competition at the expense of more robust rivals.