Eurotunnel 'gives in' to the CMA and sells its passenger ferries to DFDS

In what is probably the final step in the long running competition review for Eurotunnel's MyFerryLink operation, that I have reported on several times including January's update, Eurotunnel have today issued a press release that it holds a binding offer from DFDS for a let to buy sale of the ferries, Rodin and Berlioz.

The press release goes on to say that for the remaining vessel, 'Nord Pas de Calais' which carries freight, Eurotunnel wishes the competition authorities to allow it to continue operating the vessel alongside the fixed (rail link).

MyFerryLink's website states that they will cease operations on 2nd July (after Eurotunnel decided not to renew the lease of the two ferries to MFL).

It will be interesting to see what if anything the Competition and Markets Authority makes of this sale of the ferry assets to DFDS as I would have thought that this might now put DFDS in a dominant position. Yes they will continue to compete with P&O and Eurotunnel but DFDS already has 5 ferries on the Dover/Calais and Dover/Dunkirk routes, making 44 crossings between them each day, so I would be surprised if they really have the need for another 2 ferries as well on the same routes.

Maybe this could mark the reopening of the Dover/Boulogne route that ceased in 2010 with LDLines?

Breaking news: Competition Appeal Tribunal rejects Eurotunnel's appeal to continue with MyFerryLink service

I've written about this before in 2013 when the Competition Commission first got involved and with an update in early 2014, but the long and the short of it is that the Competition Commission decided that Eurotunnel's acquisition of SeaFrance assets and setting up MyFerryLink created unfair competition on the Dover/Calais straights that when combined with Eurotunnel's undersea traffic would create a market dominance.
Eurotunnel has appealed this decision at several junctures including the Competition Appeal Tribune and today they finally reached the end of the road as the Eurotunnel Judgement was handed down by the C.A.T.

In essence the C.A.T. has rejected all of Eurotunnel's claims and as such the original Competition and Markets Authority appeal decision that Eurotunnel must cease MyFerryLink operations within 6 months stands.

Eurotunnel's press release talks of the 'illogical' nature of the CMA decision but confirms that MyFerryLink will now be put up for sale. MyFerryLink is still not making a profit (despite Eurotunnel claiming its commercial success) so be interesting to see whether one of the existing ferry companies (DFDS or P&O) makes a bid - which will surely get referred to the CMA as well - or whether a new entrant wants to join the market.

As pointed out by Kent Online, up to 600 jobs could be affected with the closure of MyFerryLink if a buyer cannot be found.

MFL is still operating and taking bookings, even just now giving out sailing details and prices when I tried for Autumn 2015, but presumably this will cease.

There's a barney brewing above and below the Straits of Dover

Changing topic slightly, I've been following with interest recent developments in the emerging spat between Eurotunnel and the Competition Commission over the recently launched MyFerryLink.

Last summer I wrote about SeaFrance going into liquidation and then in June Eurotunnel announced that they had bought 2 of the 3 defunct SeaFrance vessels, spending €65m in the process, and in August I included photos of their nearly launched new Dover/Calais service named MyFerryLink.

Some might think it odd that the undersea channel tunnel ferry operator is funding what is effect a direct competitor to Eurotunnel whose ferry boats will carry freight and passengers over a pretty much identical route.

P&O and DFDS as the other two incumbent Dover/Calais ferry operators at this point cried "foul" and their unhappiness was further intensified when Eurotunnel considered bidding for the concession to run Boulogne and Calais ferry ports as well.

In October 2012 the whole Eurotunnel/SeaFrance takeover was referred for investigation to the Competition Commission. Preliminary findings from the Competition Commission's investigation into Eurotunnel's actions were that Eurotunnel acquired the boats to prevent DFDS doing so and that "the transaction may be expected to result in a substantial lessening of competition in the freight and passenger markets. This could be expected to lead to an increase in the prices charged".

The Competition Commission's recommended remedy for the Eurotunnel/SeaFrance issue is for Eurotunnel to dis-invest in MFL (i.e. sell the boats), but the possibility of P&O investing in its place was also rejected as being another conflict of interest.

Eurotunnel not surprisingly contests this point of view and in an interview with ThisIsKent, the chairman and chief executive officer of Groupe Eurotunnel said: "Eurotunnel intends to continue to work with the Competition Commission to allay the concerns raised by existing ferry operators and to demonstrate that the creation of MyFerryLink is a good thing for the market as it is both pro-customer and pro-competition".

Today Eurotunnel published their formal response to the Competition Commission's report, saying that:

• Groupe Eurotunnel took part in an open and transparent tender process for the assets of the defunct company, and put forward the best offer
• The acquisition was approved by the French Competition Authorities, subject to some restrictions including a requirement not to market a bundle of Tunnel/Ferry options
• Eurotunnel considers the maritime activities of MyFerryLink to be complementary to those of Le Shuttle, in particular for the new breed of super-large lorries that won't fit onto the tunnel trains
• Eurotunnel does not envisage the activity putting the two incumbent operators at risk.

The CC's deadline for resolution of the issue is currently set at 22nd of April so there will no doubt be further spats and press releases over the forthcoming month.

One news item that the Competition Commission will undoubtedly take into account when coming to their final ruling is that for the first time in Eurotunnel's 19 year history, official Government statistics reveal that it outperformed the ferries. When the tunnel was first built it was predicted that the quicker undersea route would serve as the death-knell for the ferry operators, but its taken all this time for rail passenger numbers to overtake the ferry operators - in 2012, 20 million people used Le Shuttle or Eurostar services, compared to 19.7m travelling by sea.

An Ignominious end for SeaFrance .. or is it?

Word of the day - "Ignominious" ?

A wonderful word that I had perfectly in mind for the title to this Blog posting, but then recent events have tried to spoil my plans, but I won't be thwarted and am still going to use Ignominious. There I said it a third time.

Anyway, I digress,

Whilst passing through Dover the other day on my way to the Gite (see swimming pool filter installation story), I was reminded of the sad tale of Sea France.

Sea France for those that don't know, SeaFrance went into liquidation on January 9th this year after the French courts ruled that a French government bailout was illegal and the company was forced to cease trading.

As I drove through Dover the sad demise of the Ferry company was all too evident on the checkin lanes where the SeaFrance name had been hastily sticky taped over on the signs over the lanes:

And on the French side in Calais when I returned back through the port the SeaFrance checkin booths were now hidden by recently erected DFDS booths that now stood in front of them. As I drove along the quayside to load onto my boat I spotted the SeaFrance ferries were now tied up and looking forlorn (although still rather ablaze with lights) in Calais port:

And that was to be my Blog posting about an ignominious end to SeaFrance.

But just when I was about to publish this prose, news came through from Craig over on ThisFrenchLife that Eurotunnel has been successful in its bid to buy three of the SeaFrance ferries for €65 million, and I found more news on the BBC website that a key condition imposed by the French courts was that the SeaFrance ferries would be leased back to a workers co-operative.

There's a brief press release from Eurotunnel on their site, but other than confirming the same facts and stating that the ferries would require "a technical overhaul before being brought into commercial service" (to catch up with necessary maintenance work), there's no details of when, the new company name, etc.

Obviously it would make most business sense if the ferries could resume operation before the peak summer holiday period, but even so I suspect that Eurotunnel will have missed the proverbial boat as most families will surely have booked their summer ferry crossings by now and they're unlikely to be able to pick up a lot of trade even if they were to start operation imminently?

We've been on holiday again - travelling out via Eurotunnel this time

We decided this year that like last year we were going to 3 weeks of the school summer holidays for a long break in our french country holiday home. Although it uses up an awful lot of my annual leave, it's worth it to be able to spend a lot of time together as a family and to unwind and not think about work at all.

This year for the first time I decided that we'd try out Eurotunnel as it'd be an experience for the kids and as we were taking Dexter the dog with us Liz wouldn't have all the angst of having to leave him in the car when we went onto the ferry. Eurotunnel did have one drawback though, Liz has in the past said that she was dead scared of the tunnel and didn't want to go through it, but as she had been forced to go through the tunnel twice before on coach trips with her friends I figured the worst of her panic was over and I could safely book a Eurotunnel crossing without fear of being murdered enroute!

I have to admit to being quite surprised by how reasonable the Eurotunnel crossing prices were; when I booked in February 2010, for the peak August summer crossing it was just £69 and as I paid with Tesco clubcard vouchers I was pleased that the actual voucher cost was just £17.50. Mind you as we'd had to spend £1,750 in Tesco stores and petrol stations to earn these vouchers it does show just how you have to spend an awful lot with clubcard to earn something of value.

Driving onto Eurotunnel


Through the Eurotunnel carriages


Zipping along under the sea to France

On a grey, overcast and "typical British" summer morning we set off for Folkestone and for once we arrived with plenty of time on our hands. A quick wee stop for the kids and the dog, a wander round the shopping area which was nothing much exciting (definitely had less than the equivalent airport retail experience, and arguably on a par with a motorway service station), then back into the car and by then it was raining.

If you've not been on Eurotunnel before it's quite an experience. You drive down onto the platform alongside your train and then drive into the train itself. The carriages designed to take cars are double-decker and we ended up being upstairs, giving Liz another anxious moment as she drove up the ramp into the carriage.

You then drive down the train through each of the carriages until you reach the next parked vehicle ahead of you, stop, put the handbrake on and turn the engine off.
When all the carriage is full of vehicles they automatically bring down doors and a roller blind at the end of the carriage to seal the carriage off from the next one, presumably to prevent fire spreading.

When the train is moving you can push a button alongside the doors to release them and walk through into the next carriage if you want to. Every couple of carriages there are toilet on one side and stairs down to the lower vehicle deck, but as its identical to the upper deck there's not really much to see.

And that's about it. There's no other facilities onboard the train, you're not really onboard for long enough to warrant a coffee bar or shop as the whole journey time only takes 40 minutes or so.

The train ride itself is incredibly smooth and in fact is the smoothest train journey I have ever travelled on. I showed the kids a trick I saw one of the Eurotunnel marketing guys demonstrating on the TV some years ago, when the train was speeding along under the sea at 80mph+ I was able to get a £1 coin out of my pocket and balance it on its edge on the floor of the train. There is so little swaying or jolting of the train that the coin will stay perfectly balanced on its edge!

A short while later we emerged from the other side and once the train had stopped and the doors at the end of each carriage had opened we drove off and out of the train and onto the Autoroute towards Brittany.

We also drove into another patch of rain, but this was different, it was French rain!