Speedferries Problems

[PaulT]

Will has been very informative on this subject (as he is on most).

My viewpoint on this is, based on Speedferries allegedly owing the ports and presumably other organisations sums of money:

The cheap fares that have been enjoyed by people have in fact been subsidised by those organisations that are owed money.

From the ports point of view they must have been able to have a fair idea of the financial viability of the service - after all the fares are freely available on the website and they can count the vehicles and hence gauge the income and guesstimate the outgoings and judge whether the business is viable.

It could be that the business plan was to start off cheap, build up a loyalty and then raise fares to a viable level. Clearly, that has not happened. What perhaps is unforgivable is extending the multi-booking period to drag in more cash from passengers to try to see them through as the winter months sees a fall in traffic.

There has also been the accusation that Boulogne is being more favourable to LD Lines.

I am not saying they are but I think it helps to take this to a personal level. If you were providing goods or services to someone who was not paying their bills and you could tell that their business was not viable and someone else came along who had a proven track record and had in the past paid their bills who would you favour.

Whilst we all like things to be cheap they have to be cheap and viable. Clearly Speedferries was cheap and unviable and crossings have been subsidised by passengers booking multi-trips that they have lost out on and the shareholders of all companies that are owed money.

 

[dragonrouge]

Will can confirm that for some time I have been predicting the demise of this organisation and following Administration.

Part of the role of Administrators is to sell the business as a going concern.  Please note that their fees are guaranteed and they do not come cheaply!  Some charge £1000 per hour.

It is truly sad and there are thousands out there who will say 'well done you tried and reduced prices for us' and that is indeed true and this is not knocking this organisation but it just could not work.

The creditors are enormous the overheads enormous and as the latest posting indicates this business was run on creditors money no one elses.  Shareholder funds have long been wiped out and by a huge amount running into say £5m.  So Dover suffered Boulogne suffered ordinary day to day creditors suffered and with hopefully prepaying customers not suffering be it through credit cards or debit cards.  But to keep the prices low the company has been robbing Peter to pay Paul.  Indeed HMG are owed over £1m in taxes and NI so that means that some of the employees NI have not been paid!

Therefore this has been smoke and mirrors so everytime we have used the crossing we have not been paying an economic fare and my rough calculations suggest that an uplift of over 100% was needed to make this business profitable and to wipe out losses.

Shareholders are in it for risk and reward the employees have now lost their jobs and just before Xmas.  Who should we feeling sorry for?  Not ourselves for we have had low fares that someone else has paid for!  That is being blunt but that is the way it is.

My involvement here is for a client and I have no axe to grind for I do not use the short crossings or indeed LD but use BF on the western crossings and previously PO before.  My geography both here and in the UK precludes us from using the shorter crossings so St Malo it is.

[Will]

Although it is sad to see a ferry operator fail, and even more sad to see that another 100 people are out of work as a result, it was the most likely outcome.

Ports can, and do, help ferry operators. LD Lines, for example, has a lot of help from Le Havre, and Cherbourg (among other French ports) supports Brittany Ferries - though, as an aside, LDA, the parent company of LD Lines, formed a consortium with Cherbourg's Chamber of Commerce and Industry, the current operator, to win a new contract to develop business at the port - and according to Ouest France a couple of weeks ago the bid was successful. However, the actual form of any help to a ferry operator has to be carefully arranged so as not to breach European rules on competition and, in particular, subsidies. Though it's well known that Transmanche is financed by the local authorities around Dieppe, and of course several of Brittany Ferries' ships are owned by consortiums including local authorities (which is seen by many of the company's detractors as a form of subsidy).

As P2 points out, however willing Boulogne might have been to help out a ferry service that undoubtedly brought passenger traffic to the local area, the fact that the company owed a large sum in port dues and taxes would certainly influence any decision. Boulogne can hardly be blamed for looking more favourably on another new service, run by an established and well-financed shipping company, that would have the added advantage of bringing freight traffic back to the port.

 

[David]

Well Speedferries has now officially gone as of this morning. As a regular user and flexi ticket owner I have used my Christmas ticket with LD - got 75%  (Dieppe) off so was half the price of the original speedferries ticket (with dog on board car). Just sent the e-ticket to them as confirmation with details of the sailings that I preferred and they rang me back immediatly! Can confirm that LD are to operate out of Boulogne in July 09. Hope that this will help someone else in same situation - but book quick cause thay have a ship in dock at moment so the web sailing times are not right! Good luck. Now the process of trying to get money back from mastercard starts!