Seasickness over ferry after rate hike proposal

NORTH SYDNEY, N.S. — It’s been relatively quiet on the ends of the Cabot Strait since Transport Canada released its long-awaited manifesto on the future of Marine Atlantic. But does that mean everyone’s happy with the changes coming to the ferry service? Not quite.

The Feds appeased carriers, arguably at the expense of owner-operators, in February ’06 when it declared the Port Aux Basques-North Sydney sailing would keep its drop trailer service. But now it seems the other boot has dropped as the bad news portion of that five-year, $270 million investment was announced recently in the form of hike rates and a new fuel surcharge.

The Marine Atlantic Users Group, comprised of the Atlantic Provinces Trucking Association (APTA); the St. John’s Board of Trade; and Canadian Manufacturers and Exporters, Newfoundland and Labrador division, launched an online petition to protest the new charges, which are supposed to cover Marine Atlantic’s rising fuel and pension costs. So far, the petition has over 2,000 signatures.

A 2.1 percent rate hike works out to an additional $9 per
load, multiplied by thousands of loads a year on the ferry.

“We’re getting close to what we’re calling the day of the $8 head of lettuce,” says Gerry Dowden, an APTA director and president of St. John’s-based East Can Transport Services.

The 2.1 percent rate hike works out to an additional $9 per load, on average. For firms such as East Can, whose drivers make more than 1,300 crossings per year, it’s a heavy hit to absorb. Dowden says that with excess truck and trailer capacity locally, passing such a small cost differential on to shippers has been a challenge.

Gordon Peddle, president of DD Transport, a Mount Pearl, Nfld.-based carrier, says the rate hike couldn’t have come at a worse time. A drop in demand for shipping, driven by Newfoundland’s heavy snowfall this past winter, has put downward pressure on local rates.

“There’s just not enough loads being moved right now to raise prices,” says Peddle. “We are in negotiations with our clients, but we have yet to do a full cost recovery.”

Other carriers are worried it’s the fuel surcharge that could prove even trickier to recover.

“Our customers seem to be okay with paying a higher ferry charge,” says Ryan MacDonald, operations manager at Sydney-based Tom MacDonald Trucking. “They see that as a hard cost. It’s going to be tougher to sell them on a fuel surcharge.”

The Users Group wants the fuel surcharge eliminated by rolling fuel costs into Marine Atlantic’s subsidy. The group is also asking that the ferry be declared an essential service, as well as petitioning for the addition of up to two new vessels to the service within the year.

Jon Summers, president of the Newfoundland and Labrador Independent Truckers Association, isn’t hopeful that industry will see the changes it wants anytime soon. He was heavily involved in a special advisory committee set up to study the future of the ferry operations two years ago. Summers says many of the group’s recommendations, including the discontinuance of its drop-trailer service, were ignored.

“Quick as a flash, nothing happened,” Summers says. While he’ll continuing to lobby for change, he says he fears it will be “an exercise in futility.”

Jean St. Onge, vice-president of fleet safety and maintenance at Midland Transport, says the one consoling factor is that all regional carriers are literally (and figuratively) in the same boat. “We’re all subject to the same costs, so it’s a level playing field,” he says.

Unfortunately, he adds, it’s the average Newfoundlander that will have to pay in the end.

– by Eleanor Beaton

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