This week, BC Ferries announced that their application to procure new vessels has been mostly approved—they will be getting four out of five of the vessels they sought.
However, BC Ferries is disappointed in the decision, as they were hoping to have all five new vessels approved.
The procurement process is ultimately up to an independent BC Ferry Commission, who in their approval of the four vessels, highlighted some significant challenges facing the ferry system in BC as their reasoning for denying the fifth.
The Commissioner determined that the four approved vessels are essential as they will be replacing aging vessels that currently traverse BC Ferries busiest routes, but the fifth was unnecessary.
The vessels set to be replaced are the Queen of Alberni, Queen of New Westminster, Queen of Coquitlam and Queen of Cowichan.
The primary challenge they highlighted was a systemic funding gap that BC Ferries says needs to be addressed in order for customers to receive the level of service they expect.
Additionally, BC Ferries says they are at odds with the Commission over future ferry demand pressures and what their customers see as acceptable wait times and delays.
“We’re disappointed, and obviously at odds with this decision. We put forward the strongest possible case on behalf of our customers to increase capacity and resiliency at the most affordable price,” said Nicolas Jimenez, President and CEO of BC Ferries.
“Our customers have been clear—they need more sailing capacity, fewer delays, and a ferry system that keeps up with demand in the coming years. While four vessels will still provide some much-needed benefits, we believe we’re missing a critical opportunity to build a more resilient transportation network for the future at a lower price now.
BC Ferries say there are four key points on which they disagreed with the Commission in the procurement decision to deny a fifth vessel.
Affordability was the first key point. BC Ferries says that new vessels are only going to get more expensive so it makes sense to procure the vessel sooner, rather than later.
The second key point was future demand, with BC Ferries’ data showing that the major routes are already almost at capacity during peak season. They say that without procuring all five vessels, the risks of increased wait times and delays will only increase over the next decade.
Shifting demand was the third key point. BC Ferries says they have tried to encourage customers to book sailings at off-peak times by offering discounts and promotions, but these offers are already showing diminishing returns.
Lastly, ferry system funding is a key point they disagreed on with the Commission. BC Ferries says that this point is understood by the Province and the Commission; however, procuring a fifth vessel would do more benefit than harm to their customers in the long-run.
“This is a missed opportunity to take advantage of fixed pricing to build five ships in a very affordable way for our customers,” said Jimenez.
“We fully expect shipbuilding costs and demand will continue to grow, putting even more pressure on future fares and reliable service, and may hold us back from meeting the expectations of our customers and the communities we serve. We’ll now reassess how we can best deliver service in the future that customers, coastal communities, and local businesses expect.”
Ultimately, the Commissioner denied the fifth vessel, citing section 55 (4) of the Coastal Ferry Act, which states they may approve the expenditure if it is proven reasonable, prudent and consistent with BC Ferries contract and their long term capital plan.
As for the four vessels that were approved, BC Ferries says they are currently shopping around for the most affordable shipyard.
A shipyard should be selected by the end of the summer.
