With passenger and freight traffic down sharply in the Baltic, Finnlines is calling for state aid, while it bolsters its fleet with new hybrid vessels
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.”
Expanding its green fleet
Finnlines is investing about €500M (US$588M) in a green vessel newbuilding programme under which it will add three 238-m hybrid roro and two 230-m ropax vessels by 2023. These investments are in line with Finnlines’ strategy to “reduce fuel consumption and cut harmful emissions in order to grow with its customers in a sustainable and responsible way,” says Mr Grimaldi.
Its three hybrid roro vessels – Finneco I, Finneco II and Finneco III – are under construction at China’s Jinling Shipyard for delivery in 2021. Intended for Baltic Sea operation, those vessels will have cargo capacity of 5,800 lane metres, plus 5,600 m2 of car deck space, and another 300 TEU capacity on the weather deck.
Designed by Knud E Hansen, the new vessels will each have two MAN B&W 9S50ME-C9.6 Tier II-compliant main engines as part of their hybrid propulsion package. The vessels will operate on fuel oil while sailing and use li-ion battery power when operating in the harbour. The batteries will be recharged during sailing through shaft generators. Additionally, each will have an air lubrication system to produce a layer of bubbles, reducing hull friction and increasing energy efficiency.
In February, Finnlines extended its newbuild programme with a contract for two Finnish/Swedish ice-class 1A Super 230-m ropax vessels from China Merchants Jinling Shipyard (Weihai).
Designed by Deltamarin, the Superstar ropax vessels will be larger than the existing Star-class vessels and will be Finnlines’ flagships both in terms of size and technology when they join the fleet in 2023. With a length of about 230 m, their loading capacity will be 5,100 lane metres for rolling freight and around 1,212 passengers.
Combining the best elements of cargo and passenger vessels, the Superstar ropax vessel is designed with several types of seating and public areas, ample outdoor areas and shopping options. The customer experience will be enhanced through digital services – from check-in to onboard services and feedback collection.
Below deck, each of the ropax vessels will have an efficient propulsion system from Kongsberg Maritime, which is supplying the equipment to China Merchants Jinling Shipyard (Weihai) under a €12M (US$14M) contract.
Each of the Superstar ropax vessels will have a twin shaft line propulsion system powered by four main engines that will allow the ships to operate in two efficiency/speed profiles: one in which they can have a speed of 16 knots with two engines running, or 19 knots with four engines running. This capability is enabled via a two-speed gearbox solution, delivering a propulsion efficiency increase of about 3% compared with a single-speed gearbox.
Kongsberg Maritime vice president sales and marketing in greater China Yaling Liu says the solution is based on understanding the vessels’ operating conditions to develop “strategies to improve energy efficiency, thereby saving fuel and reducing emissions. Our well-proven Ice Class 1A propulsion package will allow the vessels to work effectively in Arctic conditions, dealing with floating ice and extreme cold.”
Propulsion for the vessels will be supplied by Kongsberg controllable pitch propellers with rudders integrated into a single system. This, says Kongsberg, will optimise hydrodynamic performance, improving thrust and reducing drag, with a consequent reduction in emissions. Combined with a ‘twisted’ rudder design that further improves manoeuvrability, the twin-screw vessels can be expected to achieve efficiency gains of up to 6%, according to Kongsberg.
China Merchants Jinling Shipyard (Weihai) vice general manager Weisong Ni says the propulsion and manoeuvring system “will help ensure the vessels minimise fuel usage and emissions, at the same time assisting manoeuvrability – often a crucial consideration for passenger ferries which may dock several times every day.”