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Storm lashes new Scottish ferry
Page 6
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A furious row has erupted over plans to introduce a new ferry service between the north of Scotland and the islands of Orkney and Shetland.
NorthLink, which is to take over the route on 1 October from current operator P&O, has complained to the Office of Fair Trading (OFT) about its new rival run by Shetland's three biggest transport firms CM18-24 July).
The three, Jim Brackenridge Transport, Shetland Transport and Northwards, set up the rival operator Norse Island Ferries in response to price rises on the service that they claimed would add thousands of pounds a week to their costs. Now NorthLink has called for an urgent investigation by the OFT. claiming that Norse Island's service will distort competition on the route.
Gareth Crichton, commercial director of NorthLink, which receives a government subsidy to operate the route, says: "We believe, in view of the dominance of the Shetland haulage market by the three companies, and also—by their acting together—the share of the ferry market Norse potentially holds, that there are some very serious issues which require to be addressed urgently."
But David Kenwright, managing director of Norse Island. says he is sur
prised at the decision to complain to the OFT given that prices have already started falling: It should be remembered that originally, while NorthLink was in a monopoly position on the route, they published a rate of nearly 150 a metre. This has apparently now been reduced considerably, not least by Norse Island Ferries, which has set a sustainable flat rate of £37.50 per metre."
A spokesman for the OFT confirmed that it had received a complaint arid was considering the issues raised under competition law. However, he added that it is too early to speculate whether this will spark an official investigation.