Neil
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Post by Neil on Aug 27, 2008 19:17:50 GMT -8
BC Ferries annual public meeting was held today in Tsawwassen. You could be forgiven if you didn't know about it; it wasn't even mentioned on their website, and I suspect that holding it is a legal requirement that they would rather not have to deal with. I attended as your intrepid reporter and asked four questions, which I'll relate later. I'll not be mentioning everything that David Hahn went over, but I'll summarize the highlights.
There was an introduction from Mark Stefanson, a report from board chair Elizabeth Harrison, a report on operations from David Hahn, and financial report from Rob Clarke. Nothing earth shattering- a lot of stats that those of us who read the annual reports are familiar with, and none of the questions from the floor were particularly combative, other than the fellow from Tsawwassen who didn't like getting woken up at 5:15 every morning by the first ferry's departure blast.
Some highlights, first from the statements:
Mark Stefanson: a cautionary note that any of the statements of management's expectations could change depending on circumstances. Basically, don't put too much stock in what we tell you.
Elizabeth Harrison: Quick overview of new ships and achievements, and introduction of the Board of directors.
David Hahn:
-thanked all the ferry advisory committees.
-5.5 million litres of fuel saved as opposed to five years ago, despite more sailings.
-14000 safety training days for staff last year, 16000 this year. Remarked on BC Ferries often being first responder to marine emergencies. I got the impression, as I often do, that BC Ferries essentially augments our Coast Guard.
-Polling shows considerable increase in customer satisfaction in BC Ferries from 2003.
-Coast Savers program very successful, particularly the Saturday discounts, and will continue.
-BC Ferries using low sulphur fuels, more expensive; company also switching to environmentally friendly cleaning products; moving to sewage treatment programs for all ships ahead of legally required dates.
-Another 12% increase in fares on minor routes by 2012, smaller increases on major routes.
24% of operating costs are in fuel. $46 million 2003, $87 million 2007, as much as $140 million this year.
-Alternate Service Provider applications sought for Quadra, Cortes, Alert Bay/Sointula; responses due in September.
-All earnings are re-invested in system.
-Major Quinsam refit next year.
-Queen of New Westminster now expected back in December, on Route One.
-Northern Adventure to have last major work done this fall.
-Over $100 million spent in BC shipyards on refit work .
-Queen of Esquimalt to sail for Daolin, China approx. Sept 1st.
-Queen of Tsawwassen probably the next to leave.
-Ceremonies to retire each vessel.
-Issues with noise and vibration on Coastals to probably be rectified within two months.
-Coastal Celebration in service by November 1st.
-Hahn claimed the Coastal stop in London garnered lots of press and publicity.
-The previous five years have been focused on normalizing operations and renewing terminals and ships. The next five years will focus more on maximizing revenue opportunities, reducing fares where possible, exploring new business, and service levels.
-Hahn said BC Ferries 'needs' the drop trailer business. Possibilities include utilizing existing ships, tug and barge operations, buying vessels, or co-operative ventures. He sees commercial traffic as the main area for growth, and obviously has Seaspan and Van Isle Barge in his sights.
-Other opportunies: BC Ferries may get into the area of providing consultant services to other operations; Hahn claims there has been interest in BC Ferries expertise from off shore interests.
----------------------------------------------------------------- Rob Clarke's examination of the numbers went over figures available in the reports. One interesting note, in relation to some controversy on this forum over the awarding of a cellular phone contract to Harris Cellular, was a saving in telecommunication costs over previous years figures.
The meeting then moved to questions and comments from the floor. I was surprised when Hornby Island's ferry liaison member Tony Law took the floor only to thank David Hahn for his excellent communication, and for being so responsive whenever liaison members had questions or concerns.
The mayor of Gibsons asked if BC Ferries would be willing to partner with local communities in dealing with the effects of rising ferry costs and how it was impacting local economies. Hahn's response was an emphatic “No”. He said it was not within BC Ferries purview.
In response to a question about pollution from ferries idling at the dock, Hahn explain that engines simply could not be turned off several times a day.
A Tsawwassen resident complained about horns at 5:15 am, and Hahn explained it was TC regulations, but promised to see if the length of the blasts, or intervals between could be examined. He also related a story of a condo development on Gabriola where the residents were apprised of the ferry operations nearby before they bought, but who still complained afterward. Although he offered what help he could to the Tsawwassen resident, he told him, “You knew there was a ferry terminal there when you moved in.”
-In response to a question from Gary Coons, Hahn said that service on route 40 was a certainty for the forseeable future, but that the vessel was still to be determined. The Queen of Chilliwack may not be retired on schedule, and may receive a rebuild to meet new marine standards. Or, a vessel could be bought. The building of a new vessel seemed the least likely option.
I asked four questions:
On labour relations at BC Ferries, given the oft reported staff shortages, early retirements, and anecdotal reports of low morale. Hahn said forty years of bad practise is not repaired overnight, but that things are improving, and that the labour rep on the Board agreed things were getting better.
On why BC Ferries didn't bring the Queen of Cowichan or Queen of Coquitlam south to sub in for the Spirit that went down last weekend. Hahn stated simply that C class vessels cannot do Active Pass.
On what happened to his previous musing about a V being kept around to possibly provide night service, or commercial supplementary service. He said he had been 'out voted' by Rob Clarke and others on the Board. He said it would cost $5 million a year to keep a V, and traffic levels and the age of the vessels didn't justify it.
On BC Ferries not giving any indication of what they wanted do do at Sidney. Hahn was quite blunt- he said a good part of the decision was to keep Sidney out of the hands of rivals. He said every time he sees the Seaspan terminal at Swartz Bay, he regrets BC Ferries doesn't have it. As for future plans, BC Ferries could use Sidney in future, and commuter operations (he didn't say by whom) might be an option. He also mentioned the possibility of U.S. service, which really surprised me. He also mentioned options from the Prince Rupert terminal, but didn't specify.
General impressions: David Hahn comes across as a straight shooter who isn't afraid to tell people something other than what they want to hear. People who feel BC Ferries has no competition may be surprised that Hahn seems to be intent on taking on Seaspan and Van Isle Barge in the only area where the company sees an immediate growth potential.
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Nick
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Chief Engineer - Queen of Richmond
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Post by Nick on Aug 27, 2008 19:34:14 GMT -8
Thank you for that excellent report, Neil.
I found it interesting that Hahn said that the CC's stop in London had created a lot of publicity, I was under the impression that it didn't make many waves there. As far as the employee morale is concerned, I am not surprised that they report an improvement. This has been debated just about to death, so I'm not going to go into that too much.
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Post by Northern Exploration on Aug 27, 2008 20:13:38 GMT -8
Some comments on your excellent report Neil.
As far as morale goes, if the union rep on the Board agrees with Hahn that things are improving, that tells you that perhaps we are getting a bit of warped view here on the forum. That isn't to say improvements aren't needed but perhaps we are only hearing one side. Neil - question was there also any survey type results shared about morale or just Hahn's and the Union Rep's comment? Or maybe we are now going to be told that the Union Rep on the board has been co-opted, or maybe the union doesn't know the real score.
Hahn has said before that expanded commercial services were a priority so I guess drop trailer or additional commercial sailings seem to be in the works. Interesting that he was outvoted about using a V to do it. I still think it is interesting that there is customs at Sidney and an international drop trailer route could use it at some point in off hours to WSF. The ongoing clogs at the border are costing commercial operators.
Speaking of Sidney this I think is another confirmation of the heading off of WMG running the Cats from Sidney to somewhere in Vancouver.
Could the expansion of Prince Rupert also involve drop trailers and/or AMH vessels permanently using the BC Ferries dock rather than maintain and keep their own dock right next door?
I also found it interesting about the arm to run Ferry Terminals. YVR and YYZ airports in Canada both consult with other airports to help them improve their operations and expansion etc. An arm of YVR also actively manages two airports elsewhere. I suppose if BC Ferries operation is above average, it would make sense that there would be some consulting and management opportunities. The software and systems developed by BC Ferries could prove useful running another operation or terminals.
I appreciate your comment on your take of Hahn as well. That has been my impression from afar despite the tendency to vilify whoever is in charge.
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Post by Kahloke on Aug 27, 2008 20:46:43 GMT -8
Neil, thanks for your observations & questions of Hahn. I especially thank you for asking about Sidney. I, for one, truly believe it is in WSF's best interest to drop that run. It's a bad deal for them, and BC Ferries can have it!
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Post by Scott on Aug 27, 2008 20:56:17 GMT -8
Wow, you must have been taking good notes, Neil. Thank you very much for attending the meeting, asking some good questions, and giving a great detailed report. Very interesting!
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Post by Balfour on Aug 27, 2008 21:31:14 GMT -8
Thanks for posting all that Neil.
You brought up a good point about David Hahn being "straight shooter."
There aren't many people in Mr. Hahn's position who are like that. I have noticed this in him over the last 5 years and now that I've read more of what he has to say, I have more and more respect for him. I really appreciate his tell it as it is, no-nonsense style.
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Neil
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Post by Neil on Aug 27, 2008 21:41:25 GMT -8
As far as morale goes, if the union rep on the Board agrees with Hahn that things are improving, that tells you that perhaps we are getting a bit of warped view here on the forum. That isn't to say improvements aren't needed but perhaps we are only hearing one side. Neil - question was there also any survey type results shared about morale or just Hahn's and the Union Rep's comment? Or maybe we are now going to be told that the Union Rep on the board has been co-opted, or maybe the union doesn't know the real score. I should have been more precise. The union rep I refered to on the BC Ferries Board is not from the BCFMWU; it is Gordon Larkin, a retired rep from the Canadian Labour Congress. And, no, there were no survey results to back up Hahn's remarks. I appreciate your comment on your take of Hahn as well. That has been my impression from afar despite the tendency to vilify whoever is in charge. We can argue until we're blue in the face about the rights and wrongs of BC Ferries' current structure and the role it's playing in the province's economic and social life, but I don't think there's any question that David Hahn is doing a pretty good job of what he was hired to do.
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Post by Low Light Mike on Aug 28, 2008 12:04:26 GMT -8
For corroboration of Neil's reporting on the annual meeting, here's Ms. Montgomery's report in TheProvince: www.canada.com/nanaimodailynews/news/story.html?id=89dfc647-cc29-4158-920f-4a97b08af9d5=============== Ferries will not study impact of rising fares: CEO Annual general meeting in Delta not well attended by public Christina Montgomery The Province Wednesday, August 27, 2008 DELTA -- They may not have liked the fuel surcharges that sent their fares up by as much as 17 per cent Aug. 1, but angry ferry riders turned down a prime chance Wednesday night to stare down the entire management team of B.C. Ferries. At the company's late-afternoon annual general meeting in Delta, the only question about fares from the handful of people in attendance came from Gibsons Mayor Barry Janyk. The feisty politician wanted to know if the company was willing to partner with ferry communities to study the impact of rising fares on their social fabric. Short answer from president David Hahn: "No." Hahn said the company's role was to manage the system and its expenses, and that a such a study was the job of the provincial government, "a policy thing." The company's fuel bill is now 24 per cent of its operating costs, Hahn said. Last year, fuel totalled $86.8 million, up from $46 million in 2003, he said. This year, if prices hold, it could hit $140 million. B.C. subsidized the system by about $92 million last year, and could increase the amount to cushion the pressure of rising fuel hikes on fares. To date, as late as this August's increases, it has refused to do so. Hahn also fielded questions on: . Noise from early morning ferry horns at Tsawwassen: They're loud, he agreed, and may not have to be sounded for the full eight seconds that residents claim they sound, but he insisted the company would follow federal regulations -- which he promised to check on. . Noise and vibrations from the two new ferries, which residents in Horseshoe Bay say have cracked their walls and may be eroding the cliffs: Hahn promised a solution in 45 to 60 days. . Progress on dozens of safety recommendations made last year by former auditor-general George Morfitt. Hahn promised to post the "progress tracking" records the company is keeping on its website within weeks. . Labour relations: Improving, Hahn said. . Why the company had taken over running of the Sidney and Prince Rupert terminals: Hahn argued that terminals, more than ships, were the company's greatest assets because they could be used to capture future business. No one's building new ones so they're valuable, he said, hinting that future plans could include service to the U.S. cmontgomery@theprovince.com © The Vancouver Province 2008 ========================
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Neil
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Post by Neil on Aug 28, 2008 15:09:45 GMT -8
....and she didn't even ask any questions, while apparently I was the one working for free.... Just a p.s. to my comments from yesterday; There's a certain irony apparent when you listen to David Hahn focus on getting into the drop trailer business, and his apparent ambition to expand BC Ferries into other lines of endeavour wherever a profit seems possible. The Liberals created BC Ferries in its current form because of their belief that the private sector can run transportation systems more efficiently than government, and because of their commitment to the free enterprise, competitive marketplace. Witness their inclusion of the 'alternate service provider' process in the ferry structure, whereby private operators would be invited to provide services on a more efficient, cost effective model than BC Ferries. Five years later, the ASP process has proved to be a complete sham, with only the Keats/Gambier service privatized, and several other bids either rejected or withdrawn. Of course, the charade continues. Now BC Ferries seems ready to take dead aim at Seaspan and Van Isle Barge for commercial traffic, and surely any potential pax only carrier must know that if they devise a successful operation, it will only provide BC Ferries the motivation to jump into their market, given Hahn's openness about exploring service options beyond the company's current realm. Several years down the road, we could end up with BC Ferries having more of a monopoly than they ever did as a government utility or crown corporation, if they push their meagre complement of competitors out of the market, and expand into new areas. Hahn doesn't seem to be a stand pat proprietor; he sees growth for BC Ferries as essential, and after all, the company was created to operate on a business model, and most businesses do not say, "We're happy to stay where we are, and we'll leave some of the field to our competitors." So. A bigger monopoly, with fewer options for commercial and private traffic. Is that what you had in mind, Gord? I've never believed that the natural evolution of capitalism was toward a free, competitive marketplace. I think that's only a phase on the path toward to collection of mega monopolies dominating every major industry, and we're seeing evidence of that in the airline industry and many other fields. Open the field to private business and 'free enterprise competition', and the results are sometimes other than what you would expect.
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Post by Political Incorrectness on Aug 28, 2008 15:21:05 GMT -8
Then if the Liberals say private sector is good for transportation, why did they make Translink public exactly?
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Neil
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Post by Neil on Aug 28, 2008 16:06:28 GMT -8
Then if the Liberals say private sector is good for transportation, why did they make Translink public exactly? .... I guess because even the Liberals wouldn't try to make you believe that transit buses could ever make money.
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Christina Montgomery
Guest
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Post by Christina Montgomery on Aug 28, 2008 17:18:58 GMT -8
Sorry to leap into your discussion unannounced, but just to let you know, Neil, reporters generally make notes and ask their questions after the meeting ends. We're generally not expected to butt into other people's meetings; I've only done that once in my career, gone to a mic and asked questions from the floor, and that was only because I thought the federal minister in question would duck me in the hallway later. Sometimes it's as simple as just wanting to keep a question to ourselves and not alert other reporters. You probably noticed there were several other media outlets present. Sometimes it's just because we ask about other things we want to understand and are saving for another day. Sometimes we've talked to people in advance. I did my interviews after the meeting. But I was there taking notes, listening to your insightful, to-the-the-point questions. The only way I could finally tell you weren't a reporter was that you were so well dressed.
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Post by Low Light Mike on Sept 1, 2008 7:45:04 GMT -8
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Neil
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Post by Neil on Jun 25, 2009 22:07:46 GMT -8
Okay... false advertising. Just trying to get your attention.
This afternoon's AGM was actually a pretty perfunctory affair. BC Ferries obviously goes through this routine because they have to, and not because they have any great enthusiasm for inviting the great unwashed public in off the street to pester them with questions about their performance. It wasn't even advertised on their website, and I believe Scott counted about 36 warm bodies, including all the brass and directors. The media appeared to be giving the event a wide berth; perhaps they were hunkered down in the cheap seats in the back.
David Hahn's address was shorter than last year's, and included fewer news items that weren't in the annual report. Rob Clarke gave the financial summary.
I won't go into a lot of detail, because most of the information is available in the annual report, for those who are interested.
A few points from David Hahn's address:
-Vehicle traffic down a half million, passengers a million.
-all vessels now have data recorders
-at the new Operations and Security centre, there are two people monitoring the fleet's movements at all times. This would have caught the 'North's wayward course in time? I'm not sure about that.
-$31 million spent in northern dock upgrades.
-best hope for revenue increase lies with commercial traffic.
-last year saw a significant drop in reservation revenue.
-$1.2 million gain in disposal of assets, largely from Queen of Esquimalt. Guess they pretty much gave the 'Tsawwassen away.
A fellow asked about the rationale for traditional fare structure, as part of his complaint about the Tsawwassen to Galiano fare, which he felt should be less than other Gulf Islands trips of longer length. Hahn/Clarke replied that fares had in the past been set partly by political considerations, and that distance travelled was only part of the criteria for a reasonable fare structure. Clarke said that BC Ferries was open to different guidelines for setting fares (as long as the same revenue was realized) but that no one had expressed a desire for such a change.
A Keats Island representative brought up the subject of the Langdale dock used by Keats and Gambier residents that BC Ferries is going to forbid the use of in a few months; he was told BC Ferries will not change their decision, which they claim is based on safety concerns, and that the Sunshine Coast Regional District needs to come forward with a workable alternative, which BC Ferries has offered to partly finance.
Tony Law of Hornby Island brought up the subject of high fares hurting island economies; David Hahn once again denied that fares were playing a significant role, and offered the rather head scratching 'evidence' that ridership was down on the free interior ferries as well, as if that proved something.
Hahn blew off a transit advocate's call for BC Ferries to give a higher profile to transit on their boats and to link up with transit systems; Hahn said that since BC Ferries was a much bigger carrier with less flexibility, it was up to bus operations to co-ordinate themselves to the ferry schedule.
In answer to my query regarding the late delivery of the Island Sky , Hahn was fairly scathing about the ability of local yards to build ferries efficiently and on time. He speculated that WMG may have regretted that they ever bid on the ship, and suggested they would not want to bid on another. When I suggested that his attitude did not bode well for further construction on our coast, he stated rather flatly that BC does not have the infrastructure to build what BC Ferries needs, but that future bids would be apprised according to how they satisfied BC Ferries needs in terms of quality, price, and delivery. I was surprised at the openness of his contempt for the capabilities of our yards.
When I asked him if BC Ferries planned to go head to head with Seaspan on drop trailers, he suggested they already were, although he didn't answer another fellow's question as to whether they were actually making money in that area yet.
In reply to questions from myself and another person about BC Ferries' short and long term financial picture, Rob Clarke in particular was quite sanguine about their prospects. We were told that BC Ferries is nowhere near their credit limit, that this year's reverses were forecast almost exactly, the amount of earnings going to service interest is satisfactory, and that long term cash flow outlook does not foretell any crisis with the long term debt. Clarke did say, though, that at some point, BC Ferries may have to go the the province and say: 'These are our rersources, this is what we cannot afford to do, what would you like us to cut?'. (not direct quote).
And that was about the gist of it. New Flyer will no doubt be telling all his friends that BC Ferries AGMs are more exciting than the latest Atreyu release. Certainly more thrilling than watching Chris Martin.
Can't wait until next year.
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Post by Scott (Former Account) on Jun 25, 2009 23:12:49 GMT -8
One more crucial highlight from the AGM: - David Hahn misses the Breakfast Bunwich and does not like the Healthy Start replacement. The bunwich is still available on routes 9, 10, 11 and 17. Maybe it will be making a return on the major routes again soon..?
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Post by Mike C on Jun 26, 2009 0:17:47 GMT -8
The bunwich is still available on routes 9, 10, 11 and 17. Maybe it will be making a return on the major routes again soon..? The Bunwich surcharge takes effect next month.
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Post by Kahloke on Jun 26, 2009 7:35:33 GMT -8
When I suggested that his attitude did not bode well for further construction on our coast, he stated rather flatly that BC does not have the infrastructure to build what BC Ferries needs, but that future bids would be apprised according to how they satisfied BC Ferries needs in terms of quality, price, and delivery. I was surprised at the openness of his contempt for the capabilities of our yards. On the two occasions that I have actually met David Hahn, and from comments I have heard him make, my first impression of him is that he's pretty arrogant. He made some fairly disparaging remarks regarding WSF when I met him the first time (and told him where I was from), so I've pretty much disliked him from that moment on.
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Post by gordon on Jun 26, 2009 8:25:14 GMT -8
It is unfortunate the our yards do not seem to be able to build vessels in an efficient timely manner. If they want further New Build business from BCF.
This does lead to an interesting question. Who will build the small & medium sized vessels for BCF because I wouldn't think that it would be very cost efficient to have FSG do it & then have them transported to B.C.
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Neil
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Post by Neil on Jun 26, 2009 8:51:06 GMT -8
On the two occasions that I have actually met David Hahn, and from comments I have heard him make, my first impression of him is that he's pretty arrogant. He made some fairly disparaging remarks regarding WSF when I met him the first time (and told him where I was from), so I've pretty much disliked him from that moment on. I understand how you might have that impression, but I've always got the impression that it's more a matter of him being brusque and not afraid to speak his mind. He's not afraid to answer people's questions in a way that doesn't tell them what they want to hear. Yesterday, when a transit advocate was lamenting the lack of transit information on ferries, Hahn told him that there was a wealth of information available on line or by other means, and that people had to take some responsibility for making their own plans. He wasn't rude, but he wasn't overly diplomatic. At last year's meeting, he flatly told a Sunshine Coast representative that it wasn't in BC Ferries purview to concern itself with the economic and social effect of ferry fares on communities. He is not one to reflexively answer "no comment" to challenging questions, and his often unvarnished replies can suggest a certain attitude to some people. I think David Hahn is very much on board with the provincial government's attitude toward ferries. The Liberals may have BC Ferries in a financial straitjacket, but it's one that David Hahn is not overly uncomfortable in. He does what they want him to do.
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Post by Northern Exploration on Jun 26, 2009 9:11:46 GMT -8
On the two occasions that I have actually met David Hahn, and from comments I have heard him make, my first impression of him is that he's pretty arrogant. He made some fairly disparaging remarks regarding WSF when I met him the first time (and told him where I was from), so I've pretty much disliked him from that moment on. I understand how you might have that impression, but I've always got the impression that it's more a matter of him being brusque and not afraid to speak his mind. He's not afraid to answer people's questions in a way that doesn't tell them what they want to hear. Yesterday, when a transit advocate was lamenting the lack of transit information on ferries, Hahn told him that there was a wealth of information available on line or by other means, and that people had to take some responsibility for making their own plans. He wasn't rude, but he wasn't overly diplomatic. At last year's meeting, he flatly told a Sunshine Coast representative that it wasn't in BC Ferries purview to concern itself with the economic and social effect of ferry fares on communities. He is not one to reflexively answer "no comment" to challenging questions, and his often unvarnished replies can suggest a certain attitude to some people. I think David Hahn is very much on board with the provincial government's attitude toward ferries. The Liberals may have BC Ferries in a financial straitjacket, but it's one that David Hahn is not overly uncomfortable in. He does what they want him to do. Not having met him or seen him live, all my impressions of interviews I have seen of David Hahn is exactly as Neil describes. Straight forward, little nonsense and at times a bit blunt. Whe you deal with many companies and CEO's/Board members over the years, you begin to develop a BS sensor and it never goes off when I hear him speak. I don't get arrogance at all but he is definitely confident. I prefer to deal with clients like him because you know where you stand and things are clear. Hidden agendas or clients who you don't know what they are really thinking are much harder to deal with. Being in advertising I can also sense marketing nonsense/spin. I also don't get any of that from him. His marketing department/agencies may wish at times he packaged things differently. A person in his position knows clearly what he was hired to do, and his parameters. He may not even have to totally agree with everything. Disagreeing and making points is for behind closed doors. Only if something was dire should someone in his position hint in public that something wasn't right. So agree with him or not, he is doing his job as given him.
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Post by landlocked on Jun 27, 2009 9:33:53 GMT -8
David Hahn is a very clever and shrude businessman, there is no doubt. He speaks openly and frankly on whatever subject he is probed. What people continuously seem to be missing the point on is the purpose of seperating BCFS from government. While the Province continues to be the sole shareholder, the company was set up to operate independantly based on it's mandate, which is to provide the service under contract to the government. It is not unlike TransLink in some ways. TransLink spearheads the 'programs' while the operating companies provide the services. This type of relationship is evident in the ferry companies offerings. Take the northern runs for example. The government is prepared to offer the ferry services program to stimulate economic and tourism development and the company responds by building and operating equipment. The recent and future supply of capital equipment to the routes requires significant capital well in excess of what the current service fee provides, hence, the company goes to the government to increase the service fee to cover the new investment. It's a pretty simple concept. With respect to economic development and the welfare of local communities such as those on the Sunshine Coast, if the ferry company dropped fares would the revenue stream be neutral because of a higher usage? Probably not. Hahn points to the free inland ferries as proof. Even though they're free, ridership is still down significantly, because people are not travelling. Period. Are ferry fares discouraging travel? Probably marginally, but I would be willing to bet that other factors, such as fuel prices, increased taxes, job uncertainty, layoffs, and many other factors play a much bigger role. While I do not agree with everything BCFS does, such as expanding their drop trailer business where they receive significant public subsidy, to the possible demise of private operators, they are running a business. They have worked very hard to maximize new revenue streams, build new equipment when it was surely needed, and will continue to act in a financially prudent manner. The Island Sky appears to have been an unmitigated disaster for Washington Marine Group. It appears, listening to company reps, that it may well have been their own internal shortfalls that caused the significant cost overruns, and not their inability to deliver the product. You can bet that they are themselves exploring their own capabilities for any possible future projects. It is funny that if the figures out there in rumourland of a $70M build price are true, the same week the Norex arrives at less than double that, that perhaps BC Ferries were right all along in their assumption that while BC yards can in fact build ships here, the price is the issue. Is Washington State ferries in a mess? Look no further than the Sidney-Anacortes run. Shutting it down would save $9M per year. So, BC Ferries gives them a small discount on the landing fees in Sidney and they continue the run? What was that, other than political interference in what should have been sound and prudent financial planning. That $9M per year would probably have provided the required capital to finance $150M or more in direly needed new equipment. While Washington State is sinking in red ink, they make decisions like this? No wonder WSF has so many challenges ahead of it. Just my two cents....
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Post by Low Light Mike on Jun 27, 2009 10:20:52 GMT -8
It appears, listening to company reps, that it may well have been their own internal shortfalls that caused the significant cost overruns, and not their inability to deliver the product. Thanks for your post, Mr. Landlocked. Regarding the above-quote from your post, I'm curious what the differences is between the 2 things you've noted. Aren't "internal shortfalls" and "inability to deliver the product" the same thing? Or are you saying that in spite of their normal ability to deliver, in this particular circumstance something internally went wrong?
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Post by Kahloke on Jun 27, 2009 11:16:05 GMT -8
Is Washington State ferries in a mess? Look no further than the Sidney-Anacortes run. Shutting it down would save $9M per year. So, BC Ferries gives them a small discount on the landing fees in Sidney and they continue the run? What was that, other than political interference in what should have been sound and prudent financial planning. That $9M per year would probably have provided the required capital to finance $150M or more in direly needed new equipment. While Washington State is sinking in red ink, they make decisions like this? No wonder WSF has so many challenges ahead of it. Just my two cents.... I fully agree with you about Anacortes-Sidney. I've been saying this for a good year now - it makes sense to kill the run. It just doesn't bring in enough revenue to make any kind of business case, and - this is key here - it is NOT essential service. Politics in Washington is, well...interesting, to say the least.
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Mill Bay
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Long Suffering Bosun
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Post by Mill Bay on Jun 27, 2009 16:30:57 GMT -8
It appears, listening to company reps, that it may well have been their own internal shortfalls that caused the significant cost overruns, and not their inability to deliver the product. Thanks for your post, Mr. Landlocked. Regarding the above-quote from your post, I'm curious what the differences is between the 2 things you've noted. Aren't "internal shortfalls" and "inability to deliver the product" the same thing? Or are you saying that in spite of their normal ability to deliver, in this particular circumstance something internally went wrong? Maybe it means internal strife and discord that is hampering their ability to effectively meet product and quality expectations. It must be nice and convenient for David Hahn though to be in his position. If he is not uncomfortable in the constraints that the province has given his corporation and he goes along and does what they want, then it also gives him a certain amount of freedom to say what he wants without fear of being called back or corrected on it. That would sure give him a confidence boost. Just because what he's saying is true and accurate doesn't mean he has a license to just say it roughly and without regard for the thoughts of others. Just because he may be unable, unwilling or utterly uninterested in the concerns special interest groups raise about economic issues in their communities doesn’t mean he has a free right to simply dismiss them or condemn them. To me, that sounds more like a sneer, and that does feel a lot like arrogance. It would be easy for someone like David Hahn to be so confident in his own opinions and assured of their own assessment of the situations being right, when he is allowed to say those harsh, brutally honest things in harsh, brutally honest fashion without fear of major reprisal. It may make him a shrewd and effective businessman and executive, but he certainly isn’t not being much of an ambassador to his own customers when they try to communicate with him personally at an open meeting. But, then again, maybe that is just a posture: his favorite public bull dog face for the sake of the media, but it’s necessary to keep up appearances for the media and so it doesn’t matter if a few of the little people have their feelings hurt. But then again, maybe that’s exactly what the Liberals wanted and exactly why they gave him the job. Maybe David Hahn and Gordon Campbell should trade jobs because, at the very least, maybe we could trust Hahn to tell us the truth and stick to it, even if it didn’t sound nice.
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Post by EGfleet on Jun 27, 2009 18:15:38 GMT -8
Is Washington State ferries in a mess? Look no further than the Sidney-Anacortes run. Shutting it down would save $9M per year. So, BC Ferries gives them a small discount on the landing fees in Sidney and they continue the run? What was that, other than political interference in what should have been sound and prudent financial planning. That $9M per year would probably have provided the required capital to finance $150M or more in direly needed new equipment. While Washington State is sinking in red ink, they make decisions like this? No wonder WSF has so many challenges ahead of it. Just my two cents.... I fully agree with you about Anacortes-Sidney. I've been saying this for a good year now - it makes sense to kill the run. It just doesn't bring in enough revenue to make any kind of business case, and - this is key here - it is NOT essential service. Politics in Washington is, well...interesting, to say the least. Oh, I still say there's a chance it will get killed. As B.C. Ferries pointed out, the lease runs through 2010 and they expected payment on it no matter what. As long as they had to pay for to use of the dock anyway, why not just run out lease? I don't think we've heard the final word on the Sidney run yet, and I would be at all surprised if during the next round of lease negotiations an impasse is reached and it isn't renewed.
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