A shipping company will launch legal action against the Scottish Government and Serco Northlink over claims the publicly-funded ferry operator has instituted “predatory pricing” on its freight costs.
Streamline Shipping Group, operator of Shetland Line, has claimed Serco Northlink is charging below-market cost on bagged freight such as animal feedstuff in an effort to put the Aberdeen firm out of business.
Streamline said it has run a twice-weekly freight service from Shetland and Orkney to Aberdeen for 30 years but now finds its rates being undercut by the Northlink roro service, which operates daily.
Streamline said Serco has cut costs from £23 per tonne to less than £10 on routes.
Gareth Crichton, managing director of Aberdeen-based Streamline, said under the Serco pricing regime it was now cheaper for a haulage operator to empty his load of bagged animal and salmon feed on to the deck of the ferry and pay the rate for the load and the empty trailer than it was to carry a fully loaded trailer.
He said: “We don’t know any other operator in Europe who works in this fashion. Even to the layman, it is absurd.
“Any saving on the roro is largely absorbed as margin for the hauliers and is not being passed on to their customers on the islands.”
Serco won the £40million contract to run the Northlink “lifeline” ferry service to Orkney and Shetland in 2012, taking over from CaledonianMacbrayne.
Streamline, through its subsidiary Shetland Line, is already engaged in action against Scottish ministers over what it maintains was a flawed procurement process for the Northlink roro contract.
Stuart Garrett, managing director at Serco NorthLink Ferries, said: “As it would appear that a legal challenge is being raised on this matter it would not be appropriate to comment.”
A Transport Scotland spokesman said: “We are aware of the issues raised by Streamline Shipping Group in relation to the Northern Isles Ferry Services.
“As a legal challenge is ongoing, it would not be appropriate for Scottish ministers to comment.”