Pandemic Brings a New Dynamic To The Sector
Kaj Takolander says that although the pandemic has been tough, it has also been instructive for shipping companies and ports. “We’ve had to delve deep into our structures, but have learnt a new dynamic in the process,” he says.
In mid-May, Kaj Takolander will leave his position as Viking Line’s Sales Director to take over as Vice President of Passenger Services at the Port of Helsinki. His lengthy experience in the shipping industry has given him the insight required to gauge future developments in the sector.
“New methods must be introduced in times of crisis. During the pandemic, companies and personnel have been expected to exhibit the kind of flexibility that would not necessarily have been seen under normal circumstances. If the willingness is there, we can take significant turns, albeit slowly sometimes.”
Takolander says that the pandemic has also been a difficult time for the authorities.
Finland quickly introduced strict restrictions, which raised questions about how we would go about lifting them when the time came. And lifting them has indeed been a very painful and difficult process. To Takolander, it appears that Finland’s tactic has been to suppress the pandemic rather than to let it get out of hand.
“However, this was a naive premise, as it will be impossible to suppress the pandemic on a global scale. It’s not even theoretically possible to stop the virus at the border. Yet attempts to do this are still being made, as passengers’ vaccination certificates will be checked at the border until the end of June. Which is strange, because the virus is already in Finland and cannot be stopped at the border. And people can still catch the virus even if they’re vaccinated.”
“I hope that something has been learnt from this and, when the next crisis hits, we’ll be able to handle things better.”
No return to pre-pandemic times before 2025
Ships are sailing and people are allowed to travel. Yet Takolander says that Finns are now plagued by a mental virus that is preventing some of us from attending cultural events or taking a boat trip. Some people have also become accustomed to a life that no longer involves travel.
“Travel still hasn’t returned to prepandemic levels. I reckon we won’t bounce back to pre-pandemic times before 2025,” he says.
The current global political situation is also bringing its own flavour into the mix.
“Our almost neighbour, Ukraine, is in a terrible situation and the aggressor is a country with which we share a very long land border. And this is causing fear and concern. Some people are paralysed by it, while others are travelling as if it’s the end of days – as long as they can still get somewhere.”
This situation is being reflected in recovery: as the prices of energy and other commodities rise and purchasing power weakens, both travel and transport will naturally be affected.
Ships must offer something for everyone
Takolander knows that shipping companies must offer products that appeal to a broad range of target groups.
“The number of passengers in the northern region of the Baltic Sea is incredibly high in relation to the number of people living in the surrounding countries. Shipping companies can’t afford to embark on overly strict
segmentation.” Ships need all kinds of passengers in order to survive.
Some degree of segmentation takes place between weekdays and seasons.
“Families naturally travel more during school holidays. The early week is more geared towards senior citizens and those travelling for meetings or other non-tourist purposes. The weekends are more about having fun. This isn’t rocket science – common sense explains this distribution.”
Ship lifespans greatly extended
Passenger ships now have a markedly longer lifespan than in the 1970–80s, when fleets were being rapidly renewed due, at least in part, to a global economic boom.
“There was a considerable secondary market for ships. If you knew how to build a ship in the right place at the right time, you could sell it at a higher price than what it cost to build. It was a bit like the property market. Nowadays, the nature of shipbuilding and ship owning has changed, and cycles are therefore longer.”
Instead of being in use for seven years, a ship might find itself in service for more than thirty years. Efforts are being made to upgrade ships at regular intervals.
“But if you think about it, a longer service life might be wiser from the perspective of, say, natural resources,” says Takolander.
However, changing environmental protection requirements may impose insurmountable demands on older vessels. And sometimes the price of steel is such that dismantling a ship is better than attempting to modernise it to meet new environmental regulations.
“But the fact that we’re now getting a new fleet of ships is, of course, welcome,” says Takolander.
“Viking Line had Grace for ten years before getting Glory.”
The completion of the Glory was delayed by the pandemic, but that might have been a good thing. “
If the ship had arrived earlier, at the height of the pandemic, the restrictions could have made it really difficult to launch,” he says.
The market needs new ships
In Takolander’s opinion, Glory arrived at just the right time. The restrictions had already been lifted by the time the ship set sail on 1 March 2022.
“The new ship is helping to break people’s mental locks. New things are interesting, and people want to try them out. Glory has been a real success. At the end of April, we announced that 350,000 trips have already been booked on the ship. The market needs more ‘vitamin shots’ like this.”
“We had hoped that Glory could visit Helsinki, but that won’t be possible. At least not in the near future.”
Glory has been integrated into the Turku line’s transport system, which rests on multiple pillars: cargo, scheduled route passengers, short trips to the Åland Islands and longer trips to Stockholm. The ship would not necessarily generate enough income on the Helsinki route, but Viking Line would incur extra costs from its transfer.
“In Turku, the ship is constantly on the move and the cash register is jingling the whole time. This is the dilemma on the route between Helsinki and Stockholm, as ships spend an entire day lazing about in the harbour rather than generating income.”
Takolander therefore thinks that Helsinki–Stockholm traffic should be revitalised in another innovative fashion.
“Viking Line utilises these ships for Tallinn traffic during the summer. It’s now up to shipping companies to tap into their ingenuity and come up with a way of renewing their traffic.”
Modernising Helsinki’s passenger harbours
Helsinki’s passenger harbours are about to get the development project they sorely need. Ships must be easily accessible by public transport on both outbound and return journeys. Although urban ports are passengerdriven, they also carry considerable volumes of cars and cargo.
“The fact that Tallinn traffic will be focused on the West Harbour and Stockholm traffic on Katajanokka are good, logical decisions. This will resolve a problem that is often overlooked – feeder traffic to the port,” says Takolander.
“The tunnel project from Länsiväylä highway to the West Harbour is vital. It’s an excellent solution that will relieve pressure on the street network and ensure smooth traffic flow both to and from the port.”
He also thinks it is a good idea to consolidate Stockholm traffic on Katajanokka. In comparison to the West Harbour, where ships are arriving and departing all around the clock, Stockholm traffic does not exert quite the same pressure in terms of vehicles and cargo.
“Once we get port traffic away from the Kaivopuisto area, the City’s plan for a pedestrian centre will be feasible. Traffic can be directed to Pohjoisranta via Hakaniemi, and there will no longer be any need for it to go down Esplanadi or even come to the Market Square at all.”
“Being involved in this kind of major infrastructure project is an absolutely wonderful opportunity for me. The project has, of course, already come a long way under the direction of my future colleagues. It will be great to work with our owner, the City of Helsinki, to implement things that will make a considerable contribution to the development of our city.”