Moody’s believes Swedish owner Stena AB is set to reap the benefits of turmoil at UK rival P&O Ferries.
P&O halted all services on Thursday as it made its 800 seafarers redundant.
One service from Liverpool has resumed, but others are still suspended as cheaper agency crews are moved on board.
“The suspension is credit positive for Stena AB, which will benefit by picking up freight and passenger traffic from P&O,” said Moody’s.
“The magnitude of the impact is linked to the duration of the business suspension, but in 2019 and 2020, P&O generated revenue of around £90m ($118m) from its services in the Irish Sea,” the ratings agency added.
P&O is owned by Dubai-based terminal operator and shipowner DP World, which has a credit rating of Baa3 and a stable outlook from Moody’s.
The agency sees the ferry operation as an important link for trade between the UK and mainland Europe.
Stena AB, through its ferry company Stena Line, is a key competitor on the Irish Sea routes, operating a total of 34 daily sailings.
“With capacity from P&O Ferries temporarily suspended, we expect freight and passenger traffic to be absorbed by available capacity from Stena Line or Irish Ferries,” said Moody’s.
Stena will more or less be the only company offering shipping services on routes between Great Britain and Northern Ireland, which it serves through Belfast to Cairnryan in Scotland and Belfast to Liverpool and Heysham, the ratings agency added.
Brexit factor
“These trade lanes have taken market share from lanes between the Republic of Ireland and Great Britain following the UK’s exit from the EU in 2020,” Moody’s said.
The RMT union claimed on Monday that P&O ferry crews at Dover have been replaced by Indian seafarers being paid a basic rate of $2.38 per hour.
RMT general secretary Mick Lynch called this a “shocking exploitation” of the seafarers and “another gut-wrenching betrayal of those who have been sacked.”
“The rule of law and acceptable norms of decent employment and behaviour have completely broken down beneath the white cliffs of Dover and in other ports, yet five days into this national crisis the government has done nothing to stop it,” Lynch added.
“These ships of shame must not be allowed to sail. The government has to step in now and take control before it’s too late,” he said.
P&O has said redundancies were necessary due to unsustainable losses.
