Sunday, April 18

Hit by Covid, Finnlines questions exclusion from state aid

Finnlines president and chief executive Emanuele Grimaldi is furious with Finnish state agencies after the Finnish ropax ferry line was excluded from receiving state aid granted during the Covid-19-related passenger and freight downturn.

In reviewing the company’s Q3 2020 results – in which revenues dropped 30% year-on-year in the corresponding period, Mr Grimaldi says Finnlines has not received financial assistance from either the National Emergency Supply Agency (NESA) fund nor through a new maritime state-aid package. Some €45M (US$53M) was made available through NESA, while the new maritime state-aid package had funding of €24.8M (US$29M).

In particular, Mr Grimaldi says the new state-aid tendered for the several connections from Finland to Sweden and Estonia by the Finnish Transport and Communications Agency, Traficom, was tailormade for the existing operators, but “its terms have excluded Finnlines from receiving any state-aid.” He calls both the NESA state-aid package and Traficom’s tendering processes “distortive, against the principles of proportionality and discriminatory.”

He questions whether the requirements in Traficom’s invitation to tender were necessary to fulfil the public service obligation, ie to ensure sufficient transport capacity, security of supply and foreign trade transport. He suggests the state should look at alternative ways of supporting shipping companies, such as “public covering of standard carriers costs ie port costs, seafarer costs, shore personnel costs, pension costs and so forth, which could be looked at. Finnlines is available for co-operation in this sense.”

Covid hits results

For the nine months from January to September, the Finnlines Group’s passenger volume fell over 50% and between Finland and Sweden by 70% due to the global pandemic. As a result, revenue for January–September 2020 was €363.1M (US$427M) compared to €450.8M (US$530M) in the corresponding period 2019, which was a decrease of 20%. The result for the reporting period was €54.2M (US$63.7M) – a 34% decrease compared to €81.8M (US$96.2M) in the corresponding period last year.

“The Covid-19 pandemic shows no signs of slowing down and shipping companies across the world have been facing an exceptional situation that has never occurred before,” says Mr Grimaldi. “Despite the losses and difficult times, Finnlines has not laid down any vessels and our service has continued unaltered. Finnlines is a critical player in transporting medicines, food and other commodities to Finnish citizens and furthermore, Finnlines is an important carrier of industrial products, spare parts, machinery and equipment. Finnlines alone transports more than one third of the roughly 1M trucks moving over the three main sea bridges, Finland–Estonia, Finland–Sweden and Finland–Germany.”

He notes the economic importance of maritime transportation in Europe, and especially in Finland, where 90% of Finnish exports and 80% of imports are carried by sea.

Mr Grimaldi concludes “Finnlines has been, and continues to be, committed to ensuring vital sea freight operations on market terms and continues the same work it has done for over 70 years – including investing in the most modern and environmentally friendly vessels.”