P.K.

Well Barrie, I guess it makes a change from bombarding that nice Richard Murphy! There are two points I would like to draw your attention to. Three if you count your lack of paragraphs! The SP is a business. As such it has no "social obligations" and their fare structure and passenger "experience" serves to reinforce this. I suspect, because I do not know, that they were creaming it off from the freight and if passengers were a necessary evil in order to do this then so be it. I also can't see a "political decision" being required i.e. what do the worthies in Tynpotwald have to decide about? Exclusivity? With the lack of market research from the SP I have conducted my own. Having consulted my missus I can conclude that passengers want a fast, frequent service that is as cheap as chips and feeds them into the UK transport infrastructure as seamlessly as possible. I would have consulted Robert H Goddard on this thorny and complex issue but alas he died in 1945. Well, essentially for ever! I should imagine the tonnage the island requires is pretty much static. Sure there will be seasonal peaks and troughs but these will be understood and manageable. So your business plan is pretty clear cut. Or rather it was if you are the SP. Mezeron will also have a very clear idea of the SP freight margins which I suspect will give them a great deal of room for manoeuvre.

In the UK we have a term for this as well: Fuck-Up.

My point exactly. It's all down to the £numbers of which to date I haven't seen any! Until then speculation is rife as they say. There are some other interesting facets to this. For example, are Tesco and Shoprite now contractually bound to Mezeron? And if so for how long? After the SP have done their sums (presumably their activity right now) will they try and ride out the storm (sorry) with their current service levels? Or will they cut back in an attempt to stay profitable until they are in a position to win back their lost freight business? Of course, if they cut back on service levels do they then risk losing more freight to Mezeron? The only knee-jerk reaction from the SP I have seen to date is a verbal one (I love that mangled MBA bollocks-speak but alas I can't claim the credit for a "verbal knee-jerk" - it originally came from a US colleague!) for which Mr Woodward now seems to realise probably wasn't his finest hour. Interesting times.

Has that got anything to do with the question of whether or not passenger and vehicle services should be subsidised by containerised freight costs ? Or for that matter with the question of whether or not the entire SPCo model is possibly skewed by borrowing and profit taking ? Or for that matter with the question of whether or not the UA is basically the right way to go - as others in shipping have been asking for years ? OK, I give up pongo, has it got anything to do with the question of whether or not passenger and vehicle services should be subsidised by containerised freight costs ? It's quite an interesting scenario. Yeah, well, sometimes I'm a bit sad. As I've posted (probably a few times) before any service provider would want to maximise leverage, so don't expect any reduction in human baggage costs no matter who the agent is. Now with using Mezeron for freight will there be a price reduction in places like Tesco? Errr, no, I suspect not. Tesco point to sale costs UK-wide will be staggeringly high, even with the ubiquitous Eddie Stobart as carrier (apparently all their wagons have girl's names - I just can't believe that so many girls are called "SCANIA".) The profiteering SP tariff's will easily be hidden amongst that monster clutter. However no-one likes to be ripped off. So I suspect, because I do not know, that the shift to Mezeron for the non-perishables in particular will be a locally made decision. Tsk tsk Mr Woodward et al, you set your pricing OTT enough to make them look for a viable alternative - bad mistake methinks. So the Tesco store pricing will probably stay the same. Sorry and all that. Sure it could be that Mezeron are loss-loading to buy market share with an eye on the main prize - but somehow I doubt it...

Hang on a minute here. Any loans Macquarie have taken out based on the profitability of operations like the SP have nothing whatever to do with the charge levels. As I posted previously they would have tried to leverage the maximum out of the service anyway, irrespective of any debts. And guess what? SO WOULD ANY OTHER SERVICE PROVIDER. The difference is that over-reaching makes you more vulnerable to market forces as you have to add the debt maintenance to the SAG. With the loss of turnover the obvious thing to do is cut the number of crossings, and therefore costs, to match the amount of their remaining freight business. Thus maximising their profitability in line with the decrease in turnover. Unfortunately the debt maintenance stays a constant irrespective of the running costs - and that may be a burden that's too heavy to bear under the latest service levels. Mind you, where's the loan gone? It could be really raking it in elsewhere in the group thank you very much indeedy. And depending on their company structure it might be a better option for them to leave those who loaned the money left holding some not very valuable assets for their pains. As ever, it's all down to the £numbers - which seem elusive...

Well I have to agree with you AJS. So many posts are about what would happen if the SP was priced out and ceased trading and the actions Tynwald could take to alleviate the situation and all the rest of it. So please add to an informed debate to wit: clearly the SP have lost some business, which will hurt their bottom line. Now I've attended lots of pricing meetings but only to keep the Marketeers on Planet Earth. Everyone is in business to make a profit and they want to make the biggest profit they can. So Mr Woodward and his Merry Men (you included) will have estimated the highest leverage they think the (once captive) market will sustain. Now clearly the parameters have changed. I have noticed the missing SP subtext "We will have to take action because we are now getting less profit than we are used to, therefore we will try all sorts to return our business to the previous profit margin" and so on... So my question to you how much profit margin have you lost and when does it turn negative i.e. not worth doing? Believe me knowing those figures would really add to the "informed debate" you are so keen on...

I know. For two years running we have had summer hols in Brittany. Because of the competition on the routes you can get a good deal which basically comes down to you either driving further or sailing further. As per usual it ALL comes down to the £numbers...

Is that with Brittany Ferries? Or is it with their rival service - Condor? What??? You mean that they allow two ferry companies to compete? Shh! Don't tell Mr Woodward or he'll be crying again. The reason I asked the question is because I believe Condor is ultimately owned by - Macquairie! Because from ballaughbiker's post it would seem that competition is just what a Macquairie operation needs...

The downturn in the fortunes of shipping is solely the fault of Mark Woodward? Or are you just an ill-informed, opinionated oaf who posts without thinking? The reason his company is where it is today - sh1tting itself at the arrival of a competitor - is surely down to him isn't it? He should have been legislating for a day like this over the years and building alternative sources of business such as additional routes apart from solely Manx ones. But, I suppose that would have meant competition and he wouldn't have been up for that... Sean South, try not to rise to Mr censorships rather low quality trolling. Censorship knows full well I meant Woodward's division in the diverse Macquairie group and not the shipping industry at large. He ignored that to to give himself a platform for a pathetic insulting personal attack as per usual. Low self-esteem would be my guess...

The downturn in the fortunes of shipping is solely the fault of Mark Woodward? Or are you just an ill-informed, opinionated oaf who posts without thinking? Don't concern yourself Mr censorship. Your facetious comments ensure that your position will NEVER be usurped...

Is that with Brittany Ferries? Or is it with their rival service - Condor?

He will be very well paid. But alas and alack his business sector is currently in negative growth - for which he fairly and squarely carries the can. If I was Macquiarie I would want Mr Woodward in my office pronto to put them on a trowel and then explain what was going on and what he was doing about it. It's all about leverage and that's what he thinks he will get with these scare tactics. He's not trying to disturb the equanimity of Joe Soap per se, he wants to send a very clear message to Tynwald that if they do nothing to "assist" the SP the service levels could fall away to the User Agreement minimum levels say. This will play on Joe Soap's insecurities and he, in turn, will put pressure on Tynwald as well. I wonder if he's flying out to get his OZ connection for his beasting session? Or maybe he'll start out on one of his own puke-buckets to take advantage of that staff discount. Time will tell...

How do you know they do that - because Mr Woodward says so perhaps? They thought the linkspan meant a monopoly - wrong. I wonder how much Mezeron has hurt them? Anyone know the price differential and the size of the Mezeron traffic? Real figures would be nice but not essential. UK -> France similar distances passenger fares seem to cost 40% - 50% less than the SP but they claim the critical mass argument. They can also only raise fares in line with inflation but such a shame the level is already so high. Interesting times.

Situations like this are ALWAYS down to the numbers. And it may be that there simply isn't the business available to run two rival operations. The IOMSP bottom line has been pretty healthy for some time otherwise there would be no investment. But I should imagine they will suddenly get very concerned about keeping their powder dry commercial confidentiality. I would be very interested in the IOMSP cost base vs freight and passenger revenue correlated to the User Agreement which I believe has clauses on minimum service levels? However don't all cheer up at the thought of the SP getting their comeuppance. If it does get down and dirty it will be very messy with passenger service levels the only certain casualty.

Not touched a little nerve have I? Oh good...

How very timely...

Slow day today, so I've just found it in here. To save wading through it: "Based on legal advice, the auditors and the current Board are of the opinion that certain transactions contained within these accounts were unlawful, and, following the year end, the auditors presented a petition under the Audit Act 1983. On 11 July 2007 a number of the alleged unlawful items were sanctioned by Tynwald, and the petition was subsequently withdrawn." But I still can't find the document where the MCC and Barclays entered into the loans agreement. Strange. Although it was bang on year end.

Thanks Gladys but the MCC was already set up wasn't it? Sorry Chinanhand but despite having been in the Met I don't think I'll keep up with your insistence that you have to state your profession on here - it's a bit of a drag...[/font] I am pretty certain no matter what your position in the MET PK you are not posting on here as a policeman. Tongue in cheek Mr C, strictly tongue in cheek. That was over 20 years ago! The guarantee letter to Barlcays is here - signed by good old Mr Proffitt! The expression "well and truly kippered" springs to mind here. The Select Committee on the MEA are scheduled to meet tomorrow. I wonder if this meeting is the Go/NoGo on their "Publish and be damned" issue? They've been at it quite a while now so I would have thought they can't be that far off their definitive report. Interesting times. Wait and see mode...

Interesting. I wonder how long that's been in the public domain. So the MEA (Tynwald) paid up on behalf of the MCC.

I've had that spiteful little person on "ignore" for years now. Try it, believe me, you won't miss anything... Of course Tynwald had to pay up to MEA. Who in turn had to pay up to MCC. Who in turn had to pay up to Barclays. Barclays gave the loans to MCC, who had the MEA as a guarantor. So the MEA had to prop up the MCC, because they can't afford to lose MCC assets in default. So Tynwald (no doubt MUCH pissed off) had to pay up to the MEA because they can't afford to lose MEA assets in default i.e. the whole house of cards would have collapsed. I'm also not entirely convinced that anything "illegal" has taken place. For that to happen you have to break a law, NOT a procedure. But somebody somewhere signed the LOI between Barclays, MCC and the MEA.

I'm (Profession: part-time LSS Project Manager but mostly caring for the elderly and infirm) sure the project team thought MCC taking the loan was the quickest way to get the bank (Barclays as it turned out) to release funds because they thought Tynwald approval was not needed. Now someone in the MCC must have signed a facility letter or LOI or whatever with Barclays which would have had the release and repayment etc schedules in it. The same document would have had a MEA signatory as loan guarantor. JW does the Select Committee have this? Who are the signatories? Because I can't see how MEA can guarantee a loan to themselves when their guarantor, Tynwald, doesn't know about it. Sorry Chinanhand but despite having been in the Met I don't think I'll keep up with your insistence that you have to state your profession on here - it's a bit of a drag...

Firstly anyone who thinks Barclays would have doled out £millions in loans had there been the slightest chance of not seeing their capital plus interest coming back really IS living in cloud cuckoo land. Secondly as I understand it (Profession: part-time LSS Project Manager but mostly caring for the elderly and infirm) Barclays didn't loan the MEA anything. In order to re-finance the MEA need Tynwald approval. So the loans were taken out by the MCC which doesn't need Tynwald approval. BUT the loans were guaranteed - by the MEA! There will be documentation to this effect copies of which will be held by the Select Committee. The money was then passed on by the MCC to the MEA probably by an inter-company loan. Again this will be documented. The issue is that the MEA is guarantor of the MCC and the guarantor of the MEA is muggins Joe Public in the shape of Tynwald. So even though MEA cannot re-finance without Tynwald approval (because Tynwald are their guarantor) it seems they can if it comes via the MCC. Now that might not be 100% accurate as I haven't looked at it for a long while but that's how I remember it. Anyway, it seems the Select Committee looking into the MEA have slowed a bit as their site hasn't changed since this: Watch this space!

Well done Stu. I've been of the opinion that Mr C has been moving up the pomposity scale of late. I particularly liked the way he accused you of coming up with "a particularly poor excuse" over the actions, or lack of, of another department in the same organisation - like it's your call to cover their ass! Hopefully Mr C will now drop down a couple of notches.

The Select Committee looking into the MEA issue are due to report soon iirc. Yet their website is a little light on future activities shall we say. Strange. ETA - quiet but not moribund: Title Amend Report Priority (2) Normal Status Not Started % Complete Assigned To Marilyn Cullen Description Amend report in response to submissions Start Date 09/09/2010 Due Date 28/09/2010 Created at 09/09/2010 10:47 by Marilyn Cullen Last modified at 09/09/2010 10:47 by Marilyn Cullen

You're having a laugh! Had the true costs been correctly identified at the start would it even have gone ahead in the form it took??? So no, the costs need NOT have been basically the same.