P&O passenger numbers still falling

Ports and ferries group P&O today reported bumper business at its container terminals but said a downturn in tourism had continued into 2004.

P&O cut capacity on the key Dover-Calais route from eight to seven ships after passenger numbers slid further in the first three months of this year.

On-board services have also been changed on night sailings as the group targets £30m (€44.5m) of annual savings in its ferries division.

Passenger carryings in its ferry business were 8% lower and the number of cars and coaches dropped to 358,000 in the quarter from 388,000 a year ago.

But P&O said growth in volumes of containers in its ports business remained strong at 30%, with 17% attributable to organic growth.

Record volumes were handled at its terminals in China and India during the quarter, adding to sustained growth at its UK base at Southampton.

P&O added that its cold logistics business, which moves fruit, meat and other fresh foodstuffs, had enjoyed a good start to the year in the US and South America.

Although poultry and beef volumes were put under pressure by concerns over bird flu and BSE across the Atlantic, P&O said this was offset by strong growth in retail operations.

In addition to Dover-Calais, the group’s ferries business includes routes in the North Sea, Irish Sea and the western part of the English Channel.

P&O, which is continuing to review its ferries division, sold the Irish Sea route between Fleetwood and Larne to rival Stena for £50m (€74.3m) in March.

But it has increased cross-Channel sailings with a high-speed catamaran now ferrying passengers between Portsmouth and Caen. P&O said the service had been “well-received” since its launch at the beginning of April.

Car and coach carryings on routes other than Dover-Calais fell from 121,000 in the first quarter last year to 112,000 in the first three months of 2004.

The impact of declining passenger numbers – down from 1.69 million to 1.54 million on the Dover-Calais sailing – was being offset by higher tourist rates, P&O said.

However, freight rates were weaker than a year ago despite total carryings broadly matching those in the same period of 2003.