Ferry companies which carry vital supplies of food and medicine are preparing to drastically cut back their services unless they get immediate help from the taxpayer.
Companies such as Brittany Ferries, DFDS, P&O, Stena are days away from docking ships as they suffer daily losses understood to run into hundreds of thousands of pounds each due to a collapse in passenger numbers.
P&O – which transports 15pc of all goods into and out of the UK – is understood to be seeking a £150m bailout from the taxpayer, and the wider industry is thought to be seeking about £450m in total.
Traveller numbers on cross-Channel routes have fallen to almost zero because of coronavirus restrictions, meaning each sailing must rely on freight traffic alone – and this is not enough to turn a profit.
Operators are seeking to tap emergency coronavirus state aid funds but say they cannot afford to wait potentially weeks for money to come through and will have to reduce the number of ships in operation unless action is taken soon.
One ferry executive said: “We’ve been running services almost on a moral basis because they carry vital freight.
“The Government is under huge pressure and we don’t want to stress the system but we can’t afford to continue to make losses.
“We don’t think we are special as an industry and we’re holding out for as long as we can to give Government time, but we can’t keep bleeding money at this rate.”
The executive warned services could be slashed by as much as 50pc within three or four days without action from Whitehall.
Companies are already furloughing staff in an effort to cut spending. However, high fixed fees such as for fuel and payments to cover the cost of ships worth as much as £150m each mean they have to operate at near-capacity for the industry’s economics to work.
Half of the UK’s food supply is imported, meaning that cuts to ferries could result in shortages on supermarket shelves.
The Government has already offered special support to rail and bus operators. It has not yet done the same in aviation, but ministers are holding talks with firms such as Virgin Atlantic about whether back-up can be offered.
Sea freight industry chiefs say their trade is just as important and must stay afloat.
Bob Sanguinetti, chief executive of the UK Chamber of Shipping, said: “Action from the Treasury is needed now.
“Operators have made it clear to Government they cannot keep on losing money, it’s completely unsustainable and ships are being laid up meaning less freight coming into the country.
“If this happens more widely across the sector we could quickly see a dramatic shortage of food, goods and medicines.”
Industry sources say that while the Department for Transport understands ferry companies’ concerns, the Treasury is acting too slowly for services to be maintained.
Mr Sanguinetti said: “The Department for Transport is scheduled to discuss these issues with the Treasury next week but that is an age away in world we are living in, and there’s still no guarantee of financial assistance.”
