International hauliers have hit out at P&O Ferries amid an ongoing struggle to find alternative freight routes following the operator's decision to axe 800 staff and suspend services.
The move has heavily impacted cross-Channel freight and has serious implications for Great Britain – Northern Ireland/Republic of Ireland shipments during a period of already intense disruption.
“We don’t use P&O directly but this is going to result in capacity issues on routes which are already facing challenges, adding further volatility to an already hugely volatile market,” Carlo Turner, general manager at ro-ro specialist Continental Cargo Carriers, told MT
He addded that although there is some capacity in Eurotunnel the wider problem is from Zeebrugge and Rotterdam.
"There isn’t the capacity to re-route P&O volume onto the remaining carriers and I heard news today that trailers were already losing three days from being dropped on the quay to sailing to the UK,” he said.
Europa Road operations director Dan Cook agreed that re-routeing problems are already surfacing: “Our exposure towards P&O as a provider on both the North Sea and Channel is limited," he said, "but operationally our concerns are that while ever P&O have disrupted schedules in the short term, their customers will have to utilise the alternatives, who I don’t believe have the capacity on either route to soak up all P&O volumes, which is likely to lead to some congestion at the ports and delays in crossings for everyone."
Cook insisted the English Channel and North Sea routes "need more players not less", and that the news wasn't good for the market.
"Moreover, the apparent manner in which this has been handled by P&O is terribly sad for those staff who have been made redundant," he added.
"We will continue to monitor the situation closely and update our customers accordingly.”
Freightlink Europe director Lesley O'Brien said the redundancy announcement and cancellation of sailings would "undoubtedly cause severe bottle necks and delays at ports, putting pressure on other ferry lines".
This also raises the question again of where will vehicles park as we continue to have insufficient parking for vehicles," she said. "For Freightlink Europe as a UK operator only, unlike its name suggests, business will undoubtedly slow down as there will be a temporary slump in import and export traffic."
Meachers chairman Bob Terris said the difficulties for ferry companies caused by the pandemic and Brexit had seen them suffer adverse financial pressure.
"In the case of P&O Ferries they have taken drastic measures with some of their employees which could have been dealt with in a better way," he said.
"Our company does not send our own vehicles abroad but our international division uses sub-contractors for both import and export movements. We are experiencing difficulties with availability and reliability and some overseas operators will no longer come to the UK due to the existing problems."
Terris added that much of the unreliability is not caused by the hauliers but by delays which occur elsewhere in their movement schedule while some shippers still do not understand the new procedures caused by Brexit.
"I am sure that many businesses will be restructuring in order to accommodate the many challenges that we face with escalating costs, changes in world markets, high inflation, labour shortages and the enormous cost of improving the environment," he concluded.
"We are already seeing a large increase in the number of businesses for sale and, as always, the fittest will survive."
P&O Ferries carries around 15% of all freight in and out of the UK, more than 2,000 businesses use its services and it operates a third of the cross channel ferry market.
At the beginning of 2020, it operated nine major freight routes with 350 departures a week operating 16 vessels. Last year it shipped 2.2 million freight units. Its services are also closely connected to sister company P&O Ferrymasters, which specialises in shipments from parcels to full loads, though these are not all reliant on ferry services.
ParcelHero head of consumer research, David Jinks said the operator's admission that there would be significant disruption was "perhaps the one thing it has got right".
"Of course, other operators, such as DFDS, are stepping in to help fill the gap, but there is inevitable disruption. This has been exacerbated by the shockingly crass and insensitive way the redundancies were managed, with security staff escorting long-serving employees off ships, leading to spontaneous protests and disruptions.
"The transport union TSSA has called on the government to take over running vital ferry routes to safeguard trade and travel. That that might have to become the final solution if P&O cannot restore services.
"P&O claims it has made a £100m loss year-on-year, which has been covered by its parent company, DP World. It argues this was unsustainable. However, travel to the Continent is now picking up again with the end of Covid restrictions, Brexit trade disruption is beginning to settle down and Easter holiday traffic is just around the corner. It’s extraordinary timing. And let’s not forget P&O received almost £15m in Government grants in 2020.
Jinks argued that, ironically, Brexit and Covid 19 have had a positive impact, in ensuring most international freight transport companies have become more agile and supportive of their staff.
"P&O, however, seems to have missed the lessons of the last few years and returned to the 1970s," he said. "Ongoing protests mean a longer period of cross-Channel freight disruption than would have been the case had it followed best practice. Clearly, P&O should have consulted with unions and staff about any potential dismissals and notified the government that hundreds of jobs were at risk."
He added that P&O's "extraordinary mishandling" of the situation comes at a particularly difficult time for GB shipments to Northern Ireland and the Irish Republic. Complex rules about shipments to Northern Ireland, to avoid the creation of a land border with the EU, are still proving difficult to navigate. P&O’s Liverpool-Dublin and Cairnryan-Larne services helped keep things moving between GB and the ROI.
"P&O accounts for close to 10% of all unitised freight movements through Dublin Port. It’s small wonder that the Irish government has contacted P&O demanding details of its plans," he said.