CONCERNS have been raised over how consumers will be impacted by an increase in DFDS’s freight prices next year – as the Danish shipping firm prepares to implement a “one-off correction” following a misunderstanding of how port dues are charged.
The Economic and International Affairs Scrutiny Panel yesterday heard that the ferry operator had been absorbing the cost of the oversight this year, but that this would not be the case in 2026.
Outlining why the error had occurred, DFDS route director for Jersey Chris Parker told the Panel that: “Our expectation was that port dues would be passed through to users, because that’s generally what happens.
“In this instance, the tonnage dues are and were being passed through to customers, whereas the per-unit charges were not – and that was something which just wasn’t picked up”.
He went on to explain that, once the error had been realised, the ferry operator had been left with “a deficit in our business case”.
“If we don’t have the revenue in to meet the costs going out, then if we’ve missed a piece – which we did there – then we would have to do something elsewhere, which is either going to be a change of price or it’s going to be trying to increase volumes or reducing costs to be able to ensure that the business case still is possible to achieve,” he said.
Citing the shipping firm’s 20-year agreement with Jersey, Mr Parker noted that DFDS had been absorbing the cost this year, but added that: “For 2026 and onwards we have made that correction.”
He continued: “We put that charge back in on the basis that it is something which we need to see covered,” describing this as a “one-off correction”.
“The revenue involved is just too much to be able to just say we can absorb it and move on.
“What we have done is we’ve said we need to give some time, therefore we’ve absorbed that cost until the end of the year – but we need that course correction, which will be a one-off, and then we will be onto the right path again.”
Speaking to the JEP after the hearing, panel member Max Andrews noted that retailers had already raised concerns about increased importation costs earlier this year following the introduction of DFDS’s flat rate.
“This news today is obviously not ideally the news that we as politicians want to be hearing, nor do firms, nor do Islanders,” he added.
“It is very worrying, because I think people are already struggling as it is.”
He pointed out that it would ultimately be consumers “who are impacted the most”.
And panel chair Deputy Montfort Tadier said that, while freight customers would have been charged one way or another, “the problem here was that for most the charges were unexpected and therefore not budgeted for”.
‘Ultimately, the question is how effective can it be to run a ferry service to only one Island,” he added.
“Time will tell.”
