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Back to 20/2008
“Silja Line is back in business”
Managing director Keijo Mehtonen says that the passenger traffic between Finland and Sweden needs revitalisation.
Photo: Pär-Henrik Sjöström.
After Silja’s merger into Tallink Group the totally renovated organisation behind the brand Silja Line is now fit for fight. One company with two brands – that is what Tallink Group is today. But a merger of two company cultures is never easy and this was also the case when AS Tallink Group bought Silja Oy Ab in 2006. After that the whole organisation underwent a total renovation.
“We are now in a better shape than ever before and ready to regain lost market shares. We are definitively back in business”, Managing Director Keijo Mehtonen of Tallink Silja Oy states.
He thinks that Silja was in quite a poor shape when the company was bought from Sea Containers.
“It was perhaps not admitted then, but Silja was not effective at all.”
“It was perhaps not admitted then,
but Silja was not effective at all.”
Growth in sight
There were also a lot of technical difficulties following the merger of the two large companies. Recent problems were related to a new, common booking system for the whole group, which was implemented last autumn. The service suffered as the system did not work as planned. MD Mehtonen explains that a consequence of that was that Silja Line lost market shares to its main competitor Viking Line. But he is convinced that the lost market shares will be taken back during 2009.
“We would have been able to regain a considerable part of the lost market shares last summer, if we only had had the new cruise ferry Baltic Princess delivered on time”, MD Mehtonen thinks.
Now the transfer of the Galaxy to the Turku–Åland–Stockholm service was delayed by a month, and could be carried out in late July when the greater part of the summer season had already passed.
However, in his opinion the real challenge will be to revitalise the traffic between Finland and Sweden in order to achieve some degree of growth for the whole market. This is a common task for both Silja Line and Viking Line, he thinks.
“I strongly believe that the total passenger traffic between Finland and Sweden will start growing again, not in two digit numbers, but still.”
According to MD Mehtonen Tallink Silja is employing 10 to 12 new sales people focusing on the B2B (business to business) segment, as the company sees a large potential here.
“I call them vacuum cleaner sales persons, as they visit the clients rather than wait for them to call. B2B marketing will be reduced, and instead we activate our selling and go straight to the customer.”
In reality this means that for example the cooperation with bus travel agents has been increased. The Turku route is the most important port within this travel segment in the Finland–Sweden traffic.
The Galaxy has replaced the Silja Festival on Silja Line’s Turku–Stockholm route. Photo: Pär-Henrik Sjöström
Phasing out older ferries
Tallink Group has still one newbuilding under construction, so far called Cruise 5. MD Mehtonen informs that it has not been yet finally decided where the new cruise ferry will be employed, but the route will be announced in January 2009. However, new routes will not be inaugurated, so the vessel will be employed on one of the present services, he reveals.
“And it is sure that Cruise 5 will not be introduced on the Stockholm–Riga service. It is not at all ruled out that either the Cruise 5 or the Baltic Princess will be employed on the Turku-service, but then we must find a ‘real job’ also for the large ferry Silja Europa.”
MD Mehtonen says that the Regina Baltica from the Stockholm–Riga service will leave the Tallink-fleet after the delivery of the Cruise 5 next summer. She will either be sold or chartered out. The Vana Tallinn is also still in the fleet and the same fate is waiting her, too.
“After that the oldest ship in our fleet will be the Silja Festival and we will still have a sufficient number of vessels for our basic traffic. Within the following years we have to decide what to do with our vessels on the Helsinki–Stockholm route, but we are not under time pressure and we don’t have to make any decisions now or next year.”
Tallink will continue carrying railway wagons. Next year the Sea Wind may be replaced by a larger train ferry or she may have a new running mate. Photo: Pär-Henrik Sjöström
Cargo under development
In addition to the basic ferry services in the northern Baltic Sea, Tallink also operates cargo-oriented traffic. The future of the train ferry service between Turku and Stockholm, originating from SeaWind Line, was still uncertain last year. Now Tallink has entered an agreement with SeaRail about continuing the shipments of railway wagons between Turku and Stockholm.
“Our intention is to continue carrying railway cargo on the route. In order to be able to develop the traffic, we are looking for another vessel to run parallel with the Sea Wind or alternatively a larger vessel to replace her during next year”, MD Mehtonen informs about the future plans for this service.
“We are looking for another vessel
to run parallel with the Sea Wind.”
The Superfast service between Helsinki and Rostock will continue with two vessels as the Superfast IX is on a long-term charter to the Canadian company Marine Atlantic and will start trading on the other side of the Atlantic as the Atlantic Vision later in the autumn.
“The basic plan is to continue on the Helsinki–Rostock service with the two existing Superfast vessels, but we are also looking at the possibility to add pure ro-ro tonnage. With this solution we could also provide less expensive transport capacity than the fast Superfast vessels, which suffer from the high fuel prices”, MD Mehtonen says.
Two Brands
The Estonian ferry company AS Tallink Group operates ferry traffic under two brands, Tallink and Silja Line.
Tallink Group bought Silja Oy Ab from Sea Containers in 2006, which subsequently was followed by a total merger of Silja into Tallink Group. The new subsidiaries Tallink Silja Oy in Finland and Tallink Silja AB in Sweden continue the work of Tallink’s and Silja’s former organisations in these countries. The new organisations in Finland and Sweden mainly concentrate on sales and marketing as well as local operational activities such as check-in and back-office tasks. The activities concerning fleet operations are located to the head office in Tallinn.
Pär-Henrik Sjöström. Editor, Finland.
Latest update 24-10-2008
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