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Monday, May 20, 2024

Fjord Line logs big losses on new ferry route

Fjord Line, which runs international ferry service from southern Norway, has run into rough seas on its new short route between Sandefjord and Strömstad in Sweden. The route, in competition with long-established ferry firm Color Line, plunged Fjord Line deeply into the red last year.

Newspaper Dagens Næringsliv (DN) reported that Fjord Line lost nearly a quarter-billion kroner (USD 32 million at current exchange rates) in 2014 after launching the Sandefjord-Strömstad route last summer. In addition to heavy losses on the new route, Fjord Line’s introduction of new gas-driven car and passenger ferries on its Bergen-Stavanger-Hirtshals route has cost much more than expected. Operating losses hit NOK 161 million, with a pre-tax result of minus NOK 246 million, reported DN.

Around 75 percent of the shares in Fjord Line are held by the Teigen family of Egersund and DN reported that the board remained optimistic. Start-up costs have been high and Fjord Line chief executive Rickard Ternblom insists the decision to challenge Color Line on the Sandefjord-Strömstad route was not a mistake. European competition authorities, meanwhile, are examining whether Color Line and officials in Sandefjord have misused their dominant position in the market, while Fjord Line has sued both.

Ternblom claims the route was “unlawfully monopolized” by Color Line and admits Fjord Line’s start-up has been tough. “We’re still hindered by the blocking of commercial sailing times, but expect to get this corrected as soon as possible,” he told DN. “The summer season will be exciting.” staff



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