This article was first published in the Spring/Summer 2017 issue of International Cruise & Ferry Review. All information was correct at the time of printing, but may since have changed.
Long-time Stena Line executive and former deputy CEO Niclas Mårtensson took over as chief executive of the company from Carl-Johan Hagman in September 2016. His first few months after replacing Hagman, who resumed his position as chairman of Stena Line’s board, have been busy.
“My first months in my new position have been very exciting,” says Mårtensson. “My background and experience across various positions within the business – including route manager for two different routes, chief operating officer and deputy CEO – are all very valuable to me in my new role.”
Mårtensson notes that his focus during the initial period has been on Stena Line’s strategy and important areas such as sustainability and the digitisation of the company. “Increased efficiency is another cornerstone that will help us be competitive and deliver long-term profitability for our owner,” he adds. “To support our strategy going forward, we’ve restructured the management team to make us more efficient and decisive. During my first few months I’ve also been travelling around our business to meet staff and customers, including a number of our key freight customers.”
Like many other companies in the ferry industry that operate routes to and from the UK, Stena has been left wondering how it will be affected by the UK’s decision to leave the European Union (EU).
“Brexit is a completely new situation, which means Stena Line will have to evaluate proactively this scenario from all different perspectives,” comments Mårtensson. “We are working with the UK Chamber of Shipping on the topic for the benefit of all of Stena’s UK interests. The UK Chamber is a great neutral platform for us to work with the wider shipping community, including its social partners and stakeholders, to better understand the implications of a UK exit from the EU. It is unclear what the implications on UK shipping will be as a result of Brexit, and it is equally unknown at what pace companies will need to adapt to the new economic environment.”
New international environmental regulations are also a hot topic in the ferry industry. Mårtensson says Stena Lina is making substantial efforts to decrease emissions and ensure it meets the International Maritime Organization’s January 2020 deadline for a 0.5% sulphur cap.
“As part of our strategy we are continuously working to decrease emissions from our vessels,” Mårtensson explains. “One example is the methanol project we are running on Stena Germanica to find an alternative to traditional fuel. We’re currently evaluating what steps we need to take regarding the 2020 deadline. To do this, we’re using our experience from the introduction of the Sulphur Emission Control Areas in 2015 when we placed a 0.1% sulphur cap on our ships, excluding those in the Irish Sea outside the SECA.”
Last year, Stena announced a newbuild contract for four ro-pax ferries, which are planned for delivery between 2019 and 2020. All four vessels are being built at the AVIC Shipyard in China and the plan is to locate the vessels on the Irish Sea, specifically on Stena Line’s routes to and from its expanding Belfast hub. The contract also contains an option for another four vessels to be ordered.
“The routes to and from Belfast are strategically important to Stena Line and over the past few years, we have made significant investments in ports and vessels to improve and develop our capacity for offering a frequent high-quality service for our customers,” says Mårtensson. “Looking ahead, we intend to continue our ambitious development plan for our business in the region and the new vessels are a part of this strategic plan. Over the past few years we have seen a steady growth in freight and passenger volumes and we believe this will continue. These new vessels will be the largest ferries ever to operate between Belfast and Great Britain.”
Each of the vessels will have more than 3,000 lane metres in a drive-through configuration and will accommodate about 1,000 passengers and offer a full range of passenger services. The main engines will be gas-ready so they can be fuelled by either methanol or LNG. The aim is to build on the ro-pax concept of mixing freight and passengers.
Stena Line also confirmed in October 2016 that Harland and Wolff’s shipyard in Belfast had signed a £7 million (US$8 million) contract to carry out the bulk of the annual refit and maintenance work on its Irish Sea ferry fleet. The company said it was committed to supporting local communities where it operates and that with its expanding operations at the port of Belfast, having world-class refit expertise close at hand is a real benefit.
Each year Stena Line carries out a series of passenger facility upgrade works, as well as scheduled maintenance and engine works, to ensure its fleet of 11 Irish Sea ferries are running to optimum efficiency. The Harland and Wolff refit schedule for nine of the Irish Sea fleet will run until early May 2017 to ensure that Stena Line’s sailing schedules are not unduly impacted.
“We have had an intense period during autumn and winter where almost all our vessels on the Irish Sea have visited a shipyard for annual refit,” says Mårtensson. “Planning of an operation like this can potentially be a logistical nightmare, but through good internal cooperation and dialogue, the process has been very smooth and without any major disturbances for our customers.”
So how is Stena Line reducing operating costs and enhancing the onboard experience? “Efficiency is key for us to be competitive and achieve long-term profitability,” Mårtensson remarks, explaining that Stena works with efficiency from both a customer and an internal perspective. “Internally we work hard to keep our organisation and our operations as efficient as possible. For example, we’re continuously reviewing and optimising our timetables, and using digitisation and a fuel management system to reduce fuel consumption, which has been a success.”
Port operation is another big area that Stena is looking at from an efficiency perspective. “One example is that we are introducing automated check-in,” says Mårtensson. “From a customer experience perspective, it is very important for us to provide efficient booking and check-in-procedures. Regarding our onboard experience, we’re continuously developing our product range in the shops and the food we serve in our restaurants. Importantly, to ensure we’re on the right track, we continuously ask the customers who have travelled with us for their feedback.”