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CASE STUDY P&O
Page 39
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P&O is one of several large players that include road haulage as part of their overall company activities. Although a separate entity and prof it centre, Ferrymasters inevitably feeds traffic into its freight ferry operations.
Freight director Ronnie Dalmain is yet to be convinced by the 'motorway of the sea idea', believing that with so much road freight destined for just-intime delivery, a service moving small numbers of units probably wouldn't be price-competitive.
If production lines only need a single trailer load at a time, but each ferry carries 10 to 15 unaccompanied trailers (UTs), they then have to be parked, marshalled and shunted to the delivery point a supply chain made even more complex if there's not 24/7 unloading. (With some exasperation, Dalmain mentions a recent study indicating road congestion by trucks could be reduced by 30-40% if more warehouses took night deliveries, spreading freight traffic more evenly across a 24-hour period.) Although Dalmain currently thinks the chances of attracting sufficient volume to make a coastal RO-RO service prof able "is nil" given our overstretched road and rail infrastructures, some future service from, for example, the South-East to northern ports, is a possibility.
"Currently the future is anyone's guess," he says, but for now, Dalmain believes the recession will directly address overcapacity in both shipping and road transport.
During this recession, his primary task is maintaining P&O's route structure and continuing to offer a choice of accompanied and unaccompanied freight space. However, he admits: "P&O is likely to have to adjust capacity" management speak for reducing some service levels. "In the Humber. we've taken some capacity out as a short-term decision."
P&O is, says Dalmain "very much a volume player'. Having recently spotted a niche market for UT freight from the Thames Estuary to Belgium, Dalmain has been able to exploit Zeebrugge as a hub port with a range of UK freight destinations and react to clear change in the market from the time when Eastern Europe opened up.
Dalmain thinks the days of low salaries and low costs allowing trucks from this region to be double-manned and take the long way to the UK (via the channel ports) are gone. Costs are rising, drivers are pad more and kit is newer; contributing to a "modal shift". Tilbury is a strategic move to capture, Dalmain confirms, the "drift to unaccompanied trailers' and, because "P&O is well set up on Teesport, Humber and Dover but had a gap in the middle; we now have boats in place whichever way the market goes."