Hong Kong’s Star Ferry pledges greener service but same cheap fares as it plans HK$56 million upgrades

The operator of Hong Kong’s iconic Star Ferry has pledged to keep fares affordable but splash out HK$56 million (US$7.16 million) to upgrade its fleet with a greener emission system, as the 120-year-old company seeks to extend its franchise for another 15 years.

The proposals were discussed at a meeting of the Hong Kong legislature’s transport panel on Friday ahead of the expiration on March 31 of the company’s current franchise agreement, which allows it to run eight ferries on two routes across Victoria Harbour.

Secretary for Transport and Housing Frank Chan Fan said authorities could extend the franchise for a maximum of 15 years if they were satisfied the operator was capable of maintaining a proper and efficient service and it was in the best interests of the public to continue the arrangement.

He said government negotiations with the company had concluded with the firm making a series of promises to better its service.

Some 53,000 passenger trips were made daily on the Star Ferry between 2008 and 2016, which helped the operator reap an average annual profit of about HK$4 million, with a profit margin of 4.1 per cent.

The company runs two routes across the harbour dividing Hong Kong Island and Kowloon, sailing from Central to Tsim Sha Tsui and from Wan Chai to Tsim Sha Tsui.

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Currently, its upper deck fare for adults on weekdays is HK$2.70 while on weekends and public holidays it is HK$3.70. Those fares are 56 per cent and 72 per cent cheaper respectively than rail fares across the harbour.

“The Star Ferry has promised that it will endeavour to keep its fares affordable throughout the new franchise period, as far as possible, and provide free Wi-fi services at its piers. I think the promises it has made have largely responded to public demands,” Chan said.

“If this application is approved by the Executive Council, the new franchise will take effect on April 1.”

Chan said the company had pledged to fork out HK$56 million to retrofit eight ferries with a low-emission propulsion system and a new exhaust gas system that would reduce exhaust gases by 75 per cent and cut petrol use by 8 per cent.

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Some Hong Kong lawmakers had raised concerns that the firm might increase fares to subsidise the cost of the upgrades, but Chan said the government would consider relaxing restrictions on developing the Central and Wan Chai piers for the Star Ferry to help it generate more income.

He added that the company could apply to the government’s green transport fund to subsidise the ferry upgrades, and officials might also be able to offer subsidies for green technologies.

“We believe all this additional assistance will help alleviate the pressure for fare rises,” Chan said.