OPINION | Light at the end of the coronavirus tunnel for ferry industry

A lineup of ferries in Cebu Port

The entire ferry world, and the world in general, has been tossed upside down. To say these are unprecedented times is an understatement. We went from not having much information about COVID-19 to it now casting a spell over all our lives, economies and health care systems to an extent that seemed unimaginable – except for in the most bizarre of science fiction movies.

Currently, somewhere between 75 to 100 per cent of ferry passenger traffic and over 50 percent of vehicle traffic world-wide has dried up as a result of governments’ and health authorities’ direction to self-isolate or eliminate all nonessential travel. Most of the remaining ferry traffic is in the Ro-Pax market where operators are continuing to provide “life-line” services to deliver food and other essential supplies to the communities they serve. They do so, however, knowing that they are continuing to lose money at an escalating rate as their passenger vehicle decks and passenger spaces are virtually empty.

My hat goes off to the dedicated ferry workers who continue to work to deliver essential ferry services around the globe.

So, the billion-dollar question is – what can we do? Not surprisingly, the answer isn’t simple. The ferry industry must survive in the short-term so that we are healthy enough in the long-term to be able to provide the required level of services for our economic engines to once again reach maximum RPM’s. The tough part at this point is that no one knows where the short-term ends and the long-term begins.

Nevertheless, there are things we can do today to increase our industry’s chance of survival. This is why we recently called on governments around the world to help the ferry industry navigate through this Grand Canyon-sized trough by providing ferry operators with cash injections, tax deferrals, interest-free loans and the elimination of fixed port fees (where applicable). We aren’t asking for special treatment compared to other industries and are fully committed to having “skin in the game,” but we need help during these extraordinary times.

If you’re thinking this is one of the most pessimistic and negative updates I have ever written… you would be right. But I do think there is reason for hope and there is a light at the end of the long tunnel. I believe that our sector will be the first to rebound within the transportation industry once things start to improve. I believe this for two reasons. First, since we are considered an essential service and marine highway, it stands to reason that we will be pivotal to a sustained economic recovery. Second, once people can travel freely again, they will start by doing so within their own countries and geographic regions on our ferries before jumping on planes or cruise ships for long-haul international travel. Cruise ship travel may be in a decline for a long time. Ferry travel should have a much quicker recovery.

Since this month’s report is all about COVID-19, I would be remiss if I didn’t address it relative to our upcoming Hobart conference. At this point, we continue to plan for the conference in a similar manner to years before. The hotel, as well as the majority of other relevant venues and tours, have been locked down. Our conference sponsorship commitments have already exceeded target levels.

We are still about seven months away from the start of the conference and will continue to monitor the COVID-19 situation via the World Health Organisation, Tasmanian Health Authority and other relevant health bodies. We also continue to consult with one of the largest conference management companies in the world and take their advice – which currently is to monitor the situation through the next 60 days before making any longer-term decisions.

In closing, I do realize that there is a lot of uncertainty and angst in the world at the moment that probably won’t subside for a while… and social distancing is really not helping the cause. Thus, the need to keep the dialogue going and to stay “Stronger Together”.

P.S. I started out my column by planning to tell you about the outcomes of our recent Operators Policy Committee and IMO Domestic Ferry Safety teleconference meetings, but then decided to wait until next month for those reports. (As you may recall from my report last month, these were originally scheduled to be in-person meetings but were subsequently canceled due to COVID-19 travel restrictions.)

Mike Corrigan

Mike Corrigan is CEO of Interferry, the trade association that represents the worldwide ferry industry. Mike brings to his position of CEO of Interferry extensive executive experience in the ferry industry, most recently as the CEO of BC Ferries, one of the world’s largest ferry operators.