Not one taker stepped forward Wednesday to put in a bid on the Steamship Authority's high-speed ferry, the Flying Cloud.
The lack of interest in the vessel, for which the boat line hoped to obtain at least $5 million, is the latest chapter in the Flying Cloud's mostly troubled six-year history at the boat line. The SSA paid $8 million for the ferry in 2000.
Both SSA chairman Robert Marshall and general manager Wayne Lamson said they were disappointed in the outcome of the public bidding process for the vessel, which operates on the Hyannis-Nantucket route.
"I think the analogy is the housing market," Mr. Marshall said yesterday. "At this point, it's a tough market."
Mr. Lamson and SSA director of engineering Carl Walker will be getting in touch with the 25 or so entities that earlier expressed an interest in the vessel to see if a deal can be reached. Mr. Lamson said the Authority will continue to publicize the vessel at industry trade shows, and also may turn to a broker to try to find a buyer.
The boat line had announced its willingness to let the vessel go as early as mid-October. But Mr. Lamson said the inability to secure a bidder now may work in favor of at least a few other prospective buyers, who indicated they wanted more time to put together an offer for the ferry.
Like Mr. Marshall, Mr. Lamson used the analogy of the current softening real estate market on the Cape and Islands to describe the current demand for used fast ferries.
A couple of years ago, Mr. Lamson said, fewer used vessels were available, and the lead time to procure a new fast ferry was 12 to 18 months. "You could about get what you paid for it," he said.
But he said the boat line is offering the Flying Cloud for sale at a time when a number of similar fast ferries suddenly have appeared on the market.
Mr. Lamson added that publicity about the vessel's past failings also likely dampened enthusiasm on the part of potential buyers.
The faulty performance of the vessel's original engines led to more than 1,000 cancelled trips, undermining the reliability of service and earning the vessel the nicknames Dying Cloud and Black Cloud. Hy-Line, the private ferry company that pioneered fast ferry service on the route, capitalized on the vessel's troubles to seize much of the high-speed market share on the route.
Earlier this year, the boat line installed new Detroit Diesel engines to boost the vessel's reliability and make the ferry more attractive to potential buyers. Mr. Lamson said the engines indeed have performed well, with the vessel not missing any trips in August. What few outages have occurred in recent months have been due to other mechanical failures and an accidental encounter with a lobster pot.
The Authority's new fast ferry, the MV Iyanough, is under construction at the Gladding-Hearn shipyard in Somerset and is scheduled to enter service in November.
Should the Authority not find a buyer for the Flying Cloud in the coming months, Mr. Lamson said, the boat line may decide to lease the vessel to another operator. Another option is to keep it on hand for now as a vessel whose size is more appropriate to some off-season trips with lower passenger volumes on the Hyannis-Nantucket route.
The failure to sell the Flying Cloud has presented the boat line with another problem. Authority managers had hoped to use proceeds from the sale toward the mid-life refurbishment of the MV Nantucket. The renovation of that vessel, scheduled to start later this year, is estimated to cost between $5 million and $5.5 million.
Mr. Lamson said the boat line if necessary would issue bond anticipation notes to finance the work. Until and if the Flying Cloud is sold, those notes and the bonds that would come behind them would represent an additional burden to be paid by the customers of the Authority. SSA managers anticipate that normal Authority operations already will require a roughly 5 per cent increase in fares for the coming year.
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