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On The Bus

Ferry Fares to Rise?

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Sea Truck Ferries are warning of significant fare rises due to new international regualtions on sulphur emissions that start on 1st January 2020. 

It means they will have to buy low sulphur fuel which is significantly more expensive than the stuff they use now - they warn this will have a significant affect on prices customers pay. 

The other option is to buy exhaust scrubbers that seemingly are controversial and not 100% effective. 

So what's the Steam Packet plan of action for this and how much will fares go up?

 

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43 minutes ago, On The Bus said:

Sea Truck Ferries are warning of significant fare rises due to new international regualtions on sulphur emissions that start on 1st January 2020. 

It means they will have to buy low sulphur fuel which is significantly more expensive than the stuff they use now - they warn this will have a significant affect on prices customers pay. 

The other option is to buy exhaust scrubbers that seemingly are controversial and not 100% effective. 

So what's the Steam Packet plan of action for this and how much will fares go up?

 

FB_IMG_1559813048933.jpg

Some liner companies have already introduced a surcharge to cover the costs.

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Its been known about for some time (6 or 7 years). They and the Steam Packet and other Ferry companies have had plenty of time to modify or adapt.

All new tonnage has been fitted with LNG power for a number of years. Any new Steam Packet boats will also be fitted with LNG engines.

Brittany Ferries did decide to put in after market scrubbers, even entered into contracts, but that was cancelled and they've gone ahead with a massive replacement spending spree, getting the new ferries designed and built by Stena, who will lease them to BF.

New build is not without its problems. The two new biggest CalMac LNG powered ferries, being built on the Clyde, are 18 months behind in construction and at 100% cost over run.

 

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no change for Manannan, it already runs on 2020 emissions compliant MGO.

Ben, they won't put a scrubber in, likely they'll wait for bunker manufacturers to LSHFO which will meet new emissions limits.

Yes, will be more expensive, but not as expensive as MGO.

Maybe they will put another "fuel surcharge" on, but might be restricted on doing so through new sea services agreement..

I think can probably say with certainty that fares won't get any cheaper though!! 

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Isn't it amazing that companies only ever see the growth and profit options?

I really can't think of any large company that really and truly tries to give customers a good retail experience for a reasonable profit return.

I suppose the word, 'reasonable',  needs qualification. I would say that after on costs around 15% would be reasonable......how about you folks,

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32 minutes ago, doc.fixit said:

Isn't it amazing that companies only ever see the growth and profit options?

I really can't think of any large company that really and truly tries to give customers a good retail experience for a reasonable profit return.

I suppose the word, 'reasonable',  needs qualification. I would say that after on costs around 15% would be reasonable......how about you folks,

What an excuse to double it!

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Posted (edited)
15 hours ago, doc.fixit said:

Isn't it amazing that companies only ever see the growth and profit options?

I really can't think of any large company that really and truly tries to give customers a good retail experience for a reasonable profit return.

I suppose the word, 'reasonable',  needs qualification. I would say that after on costs around 15% would be reasonable......how about you folks,

I think I read somewhere years ago that the Steamy profit margin was then in excess of 30%. I don't know how true that is because it was a private company. Maybe it was just "man in the pub" talk. In the absence of accounts, I also don't know how much heed this took of the periodic requirement for fleet replacement. Figures without context are meaningless. Now that it is owned by the government are we going to see accounts published?

As for acceptable net profit margins more generally, unless your offering is a monopoly or totally innovative or unique in your market, you will be doing very well indeed to top 10%, despite all of the talk of profiteering that we hear. Manx Gas is under the cosh for its 10% when similar utilities are making only 5%.

15% is excellent and unusual. Supermarkets make about 2% nett. Amazon, about 1.75% and that after 20 years of massive losses funded by shareholders and grinding businesses that could not survive at that level into the ground. The business model is the hope of jam tomorrow driving a relentless rise in the share price. They never paid a dividend and never likely to, but if you got in early you made a killing on the stock.

Edited by woolley
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8 hours ago, woolley said:

Now that it is owned by the government are we going to see accounts published?

And will we believe them if they are?

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12 hours ago, Non-Believer said:

And will we believe them if they are?

Well if they are published I would - as much as I believe any set of accounts. If you are smart and cynical, which is always useful when examining accounts, you become accustomed to looking for a subtext to read. We are told that they will be looking for outside participation from investors and if this is the case, they will have to publish. In any event, surely there will be a clamour to know from the public.

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2 hours ago, woolley said:

Well if they are published I would - as much as I believe any set of accounts. If you are smart and cynical, which is always useful when examining accounts, you become accustomed to looking for a subtext to read. We are told that they will be looking for outside participation from investors and if this is the case, they will have to publish. In any event, surely there will be a clamour to know from the public.

They are published. As they operate to UK the company has to register F in the Company Registry in the UK where  they have to lodge the accounts.

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26 minutes ago, John Wright said:

They are published. As they operate to UK the company has to register F in the Company Registry in the UK where  they have to lodge the accounts.

Yes, but they are substantially abbreviated accounts and are by no means the full statutory audited accounts that include all the notes to the accounts that usually contain the interesting information... 

As it's now owned by iomg, would expect that would be difficult for the govt to wiggle out of making public the full statutory audited accounts for iomspc....

 I'm sure the executive of iompsc will welcome the disclosure of the banding of their remuneration packages!!! 

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15 hours ago, Non-Believer said:

And will we believe them if they are?

We hopefully will soon have an Auditor General, so the accounting will need to be credible

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45 minutes ago, Donald Trumps said:

We hopefully will soon have an Auditor General, so the accounting will need to be credible

In an alternative Universe....

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