Mezeron & Steam Packet Master Thread

[Megan]

Manxman 8180, you beat me to it.

 

B4mbi, I am referring to the overall level of services currently provided, not just the no doubt profitable peak sailings. I doubt that there are many operators out there willing to run an all year round, passenger only, service to the levels we have at the moment. I would imagine winter sailings would be substantially reduced and routes/destinations reviewed. All this then has a knock on effect with regard to the ships used and crews employed, in turn leading to a less stable or secure service. In my opinion this is exactly what the User Agreement was intended to avoid – by ensuring we have a long term agreement between the Government and the Steam Packet, committing them to provide clearly defined levels of services.

 

Noel Hayes put it well recently - the open skies policy has led to 7 air operators coming and going from Ronaldsway, some owing the Government large sums of money, and has led to considerable uncertainty over air travel at various times. Meanwhile the Steam Packet has served the island for 180 years....

[When Skies Are Grey]

Finally, anyone is free to start up a passenger operation out of Douglas at any time. Just get yourself a side loading vessel and away you go.

 

When does Mr Whipp start his operation up? Passengers?

[Nom de plume]

that doesn't stop them from being a gang of thieving robbing ****s ... **

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

** according to some.

 

 

Manxman 8180, you beat me to it.

 

B4mbi, I am referring to the overall level of services currently provided, not just the no doubt profitable peak sailings. I doubt that there are many operators out there willing to run an all year round, passenger only, service to the levels we have at the moment. I would imagine winter sailings would be substantially reduced and routes/destinations reviewed. All this then has a knock on effect with regard to the ships used and crews employed, in turn leading to a less stable or secure service. In my opinion this is exactly what the User Agreement was intended to avoid – by ensuring we have a long term agreement between the Government and the Steam Packet, committing them to provide clearly defined levels of services.

 

Noel Hayes put it well recently - the open skies policy has led to 7 air operators coming and going from Ronaldsway, some owing the Government large sums of money, and has led to considerable uncertainty over air travel at various times. Meanwhile the Steam Packet has served the island for 180 years....

[b4mbi]

Manxman 8180, you beat me to it.

 

B4mbi, I am referring to the overall level of services currently provided, not just the no doubt profitable peak sailings. I doubt that there are many operators out there willing to run an all year round, passenger only, service to the levels we have at the moment. I would imagine winter sailings would be substantially reduced and routes/destinations reviewed. All this then has a knock on effect with regard to the ships used and crews employed, in turn leading to a less stable or secure service. In my opinion this is exactly what the User Agreement was intended to avoid – by ensuring we have a long term agreement between the Government and the Steam Packet, committing them to provide clearly defined levels of services.

 

Noel Hayes put it well recently - the open skies policy has led to 7 air operators coming and going from Ronaldsway, some owing the Government large sums of money, and has led to considerable uncertainty over air travel at various times. Meanwhile the Steam Packet has served the island for 180 years....

 

supply/demand?

 

If the demand is not there for a passenger sailing EVERY day, then why put one on?!!

 

Sure, it's convenient being able to travel any day you like but is it totally essential that you should have the possibility to take yourself and your car off the island 365 days a year?

 

I doubt that if there was no passenger / car service on say tuesdays and thursdays during the winter months that a lot of people would be inconvenienced?

 

Surely if you're taking the car away, this usually involves some form of forward planning.

[manshimajin]

Megan, you are right that there are a number of issues at play here.

 

The financing of the purchase seems to be a pretty normal Private Equity investment - borrow big, pile repayment and servicing costs on the operating company and hope to sell at a good profit down the line. Unfortunately both the economic downturn and the competition from Mezeron have probably scuppered this strategy in the short term.

 

IMO it is also impossible to ignore the UA as part of this equation. The UA, providing as it does, almost exclusive access to the Linkspans to the IOMSPC has 'goodwill' value. The IOMSPC (I suspect) saw this when they applied for and were granted an extension of the UA and all that the UA entails to 2025/26 (?). But the longer the owner hangs on to the IOMSPC the less the 'goodwill' value of the UA. And bear in mind that the ultimate owner is not a transport company but a group of pension funds. IMO this would normally come togethr to mean that the pension fund would want to dispose of its holdings whilst there was still reasonable life and value in the UA, say 10 years. But the arrival of Mezeron in Douglas has shown that competition is possible and not only potentially affects operating profit but also the market value of the IOMSPC. No wonder they are concerned.

 

Whilst the UA exists Mezeron are not going to be able to bring in a RoRo ship and will have to use the relatively inefficient lift on lift off process.

 

My impression is that the IOMSPC is adapting exactly the wrong approach in face of this competition. Instead of whingeing it should be responding vigorously to the competition it faces. As Barrie Stevens points out the Mezeron ships are probably on short leases so the IOMSPC if it rolled up its sleeves to compete could probably give Mezeron a hard time. Thoughts on what they could do:

 

• Give attractive discounted rates to major users subject to them committing to exclusive use of the IOMSPC - if there is any issue of restraint of trade do this on volumes to be carried (which IOMSPC management must have a good idea of)
  
• Review the costs of freight transport - I don't know for example if costs are managed to attract freight traffic to low business times?
  
• If there are service issues - as suggested on this thread - investigate and do something about them if needed
  
• Cut the fleet down to 2 ships - sell the Snaefell and use any money raised to pay off the loan
  
• Based on volumes decide whether it would be feasible to make one UK crossing per day only in low traffic times
  
• Sail to only one port in the UK and one in Ireland to minimise port costs
  
• Try a few marketing experiments on passenger/car sailings - like last minute fares, sales in low booking times, (my hardy perennial) an IOM stop-over fare between UK and Ireland etc...the compay must have accumulated a very useful client database through onine booking that they could use to promote business
  

 

AS for the quality of staff - I think many of the concerns expressed on the forum relate to the response of management to challenging times. Personally I am a medium level user of the ferries and I have always had positive experiences when dealing with frontline staff including the booking staff when I have needed their help.

Edited November 23, 2010 by manshimajin

[Sean South]

Incidentally, the price paid for the Steam Packet was determined by the previous owners and paid by the current owners. The local management and staff did not set the price and I find it quite puzzling that there is so much vitriol and anger towards a local company and local people. It’s like blaming a tenant farmer for the price of his land - quite unfair.

Mark, surely it can't be called a "local company" any more can it? It's main place of business is Douglas but it is owned in Australia is it not?

 

Anyway, back to the price and the User Agreement - the two are inextricably linked as the value of the Steam Packet to the current owners was the long term, stable nature of the business. As an island, we will always be reliant on sea going freight and passenger services – that gives them long term - and the User Agreement granted the rights, if you like, to the majority of the freight business to the Steam Packet in return for their provision of passenger services – that gives the stability.

But are the Manx people getting the best possible value for money in return for their handing an exclusive licence to the SPCo? No they are not. They can't be when most of the income from said services is going away to pay off massive loans that have little to do with the island based business.

 

They signed the Agreement with the Steam Packet, both sides making the commitment that gives us our lifeline. They should hold their nerve and agree that the spirit of the Agreement is more important than the letter.

The "Spirit of the Agreement" is not worth the paper it's written on. If the shoe was on the other foot the Steam Packet would be insisting on the exact terms of the agreement not the Spirit of it. The "Spirit" bunkum needs to be taken up with the legal advisers who cleared the agreement for the SPCo

If Mezeron can continue to take the cream off the top, by moving freight without the commitment to invest in vessels (so their chartered boats could tootle off somewhere else one day), without the commitment to provide daily passenger services (and pay the harbour dues for those passengers), without paying Manx workers (who then pay Manx tax and NI), without paying for the use of a linkspan (and I believe paying rent to site the other linkspan), the Government will lose revenue as well as passenger services. The freight revenue that Mezeron makes goes to its own coffers, the savings made by the hauliers also stay with them - unless they choose to pass on their savings to the public and - unlike the Steam Packet - they have made no commitment to use that revenue to benefit the island at all.

Perhaps, then, the answer is that The Govt needs to tear up the agreement and lcience routes and tie in any licencing with a clause that both freight and passenger carriage must be offered by any licencee?

As I said before, I find the antagonism towards the local staff quite staggering. They are stuck between the Government, the public and their owners. All three want different things and they are all hard masters to please.

Maybe it's because we have been on the receiving end of the abrupt (for want of a worse word) attitude of many of the staff and more especially the Mangagement for a long long time and decided that enough was enough? It's always a problem with a monopoly in that the beneficiary has a false sense of security and can sometimes tend to be, how shall I say, a bit nonchalant? when it comes to appreciating that a business is not a business without customers. The SPCo had us all by the curlies for a long time and now that's no longer quite the case so we're all supposed to feel sorry for them all? Yeah.. right!

Edited November 23, 2010 by Sean South

[Megan]

B4mbi, agreed, supply and demand does usually dictate the market but, in this case, what happens if the demand is only there for sailings 3 or 4 days a week in winter. What do you do with your crews and/or ship the other 3 or 4 days, do you pay them reduced rates as they are sailing a reduced number of crossings and just leave an expensive asset tied up in harbour?

 

Come summer, will you have the crew available to meet the presumably higher demand if they've been on reduced rates all winter?

 

It is not as simple as either turning up or not on the day, depending on whether passengers want to sail. I don't know the ins and outs of it all but it makes perfect sense to me to let passengers piggy back on a freight service which will run every day rather than try and run the two separately. It's like sending two vehicles out on the road when one would do the job - we wouldn't do it in that situation but we seem to lose all sense of perspective when it comes to the sea.

 

Incidentally, Nom de plume, it would be interesting to see Mezeron's profit margins. They may be charging less for freight but, given their lower overheads, I wonder if they are more or less thieving, I mean profitable.

[Megan]

Sean, I don't expect anyone to feel sorry for the Steam Packet. It is the travelling public who will be hurt by this if the basis for the User Agreement (security of freight in return for guaranteed levels of passenger service and investment) is circumvented by all this.

 

I am Manx born and have travelled on the Steam Packet all my life so I hope they are rolling up their sleeves and working out what they can do. However, I still believe that the User Agreement, working as originally intended, is vital for passengers to be able to rely on a secure, stable service. That is what is important in all this.

[Alias]

It works both ways, SP aren't at a complete disadvantage. For sure, there probably isn't much money in foot passengers - but vehicles I'm guessing are another story. Putting everything in containers straight for Mezeron is a disadvantage too, when they'd normally be just on the road network in the UK. The passenger facilities on the SP are primarily needed for vehicle drivers, commercial or non-commercial, and foot passengers are just a bonus on top of that.

 

As a going concern, SP itself is still profitable (still even a decent profit, the pre-Mez profit was just bloated).

[asitis]

It seems to me the SPCO has a flawed business model which has been brutally exposed. All these years with a monopoly have I believe weakened its ability to function as a competitive agent, and the management have no idea how to manage the situation as now exists.

 

The current situation for most companies in the real world would still be a feather bed in a niche market !

 

If they cannot work out how to operate in this new environment then find someone who can ! and I dare bet there will be a number of eager takers.

[WTF]

Tugger, I don't expect the Manx public to pay. I expect the Government to acknowledge that the User Agreement was drawn up to give the Steam Packet the security of freight in order to guarantee the level of passenger services we have. That document protects us from losing services that are not commercially viable on their own. Amend things via the Agreement if you want but recognise that it works two ways, it benefits the Isle of Man as well as the Steam Packet.

 

WTF, yes, the User Agreement was drawn up to protect passenger services - by giving the security of the freight traffic to the Steam Packet. Otherwise, again, non-commercially viable services just wouldn't happen. The freight doesn't need protecting - as Mezeron has shown, it is commercially viable alone. Add in passengers and it becomes a whole different ball game. No one would run the passenger services we currently have on a stand alone basis.

 

 

'freight' has been coming into ramsey for YEARS, IF the government intended for the racket to have all the freight messyron would not have been allowed to use ramsey to dock goods in the first place. messyron already compete with the racket for freight, but somehow docking in douglas seems to change something?? what? i'm fairly certain i've seen containers in ramsey before??

[ITV Granada IOM]

Unedited video of IoM Minister Phil Gawne meeting employees of the Steam Packet company ahead of meeting with union officials

 

http://www.manxtube.com/video/2485/Union-confronts-Minister

[Manxman2000]

At over £2000.00 to bring in a curtain trailer and return it to Haysham I think Mezeron will get more work yet. never mind Manx Independents MD saying he is staying with the SPC, If the rates are not reduced to a more acceptable level even he will join Mezeron and hang the SPC.

 

As for the crew members that are Manx or Manx workers, any shipping line moving in (and one will) will need crew. But standing about hustling anybody that walks past is not going to help is it. It could be decided that better crews can be had in Scotland.

 

 

Face facts we have been held to ransom by this company and many (but not all)of its staff for long enough. Its time for the Australian Bank to pack up and go. Either take the Steam Packet with you or sell up, but do not forget woodward the pratt you can keep him.

Edited November 23, 2010 by Manxman2000

[GD4ELI]

Unedited video of IoM Minister Phil Gawne meeting employees of the Steam Packet company ahead of meeting with union officials

 

http://www.manxtube....fronts-Minister

 

So slow it's almost unusable (Manx Tube, not Phil Gawne)

[thesultanofsheight]

Face facts we have been held to ransom by this company and many (but not all) its staff for long enough. Its time for the Australian Bank to pack up and go. Either take the Steam Packet with you or sell up, but do not forget woodward the pratt you can keep him.

 

Too right. Its time for the Aussie pirates to "do one" and take that arrogant knob end with them. To them it must be amazing how one complete dick can potentially trash a leveraged £200m client investment portfolio just by opening their mouth. The SPC might have over 150 years of history with the IoM but at least Dohle has been here in one form or another for a much longer time that these Antipodian venture capitalists who have had a few good years and then pissed on their chips.

Edited November 23, 2010 by thesultanofsheight