Clipper Navigation is preparing to cut in half the number of sailings it will operate in the height of summer, lay off 20 staff at its Seattle office and reduce shifts for its Victoria staff as it attempts to staunch the financial bleeding in the wake of the ongoing trade dispute between Canada and the U.S.
The company, which has operated a passenger ferry between Victoria and Seattle since 1986, said it has no choice but to find a way of cutting costs as passenger numbers on both sides of the border are down dramatically.
“The revenue will definitely be weak this year, far below expectation,” said Clipper chief executive Mark Collins. He said cutting back the number of sailings still doesn’t go far enough to right the ship. “That does not restore us to anything close to what our budget projections are. We’re having to take steps to ensure that we’re around next year, that we can be ready to be strong next year.”
Collins said Canadian travel on the ferry is down 35% while U.S. travel is down 7% to 10% compared with last year.
“When we’re forecasting to be 35% off during peak season, it’s pretty tough,” Collins said.
To deal with it Clipper, which normally runs two round-trips seven days a week in the summer, will cut back to one round-trip daily, and in the shoulder seasons of spring and fall the schedule will be trimmed to one round-trip five days a week.
Collins said the changes mean the service will have cut its sailings by 20% over the course of the year. In Seattle the cuts were deeper with 20 people laid off and management shuffled around. In Victoria, the unionized work force will not be laid off, but they will have their shifts drastically reduced, which could result in staff leaving to find more stable employment.
“We will effectively close our Victoria terminal two days per week” in the shoulder season, Collins said. He concedes losing workers is a big risk if the economic climate turns around and they need to respond by ramping up service. In total, 30 of Clipper’s 120 staff will be affected by the cuts.
“Many of our staff here in Victoria are very long-serving, very professional and … I totally understand if they’ve got to find work elsewhere,” he said.
Collins said the drop in ridership is down to a suite of factors ranging from pent-up ill-feeling for President Donald Trump and the derogatory comments made about Canada, concern about what is going to happen at the border, the exchange rate for Canadian travellers and the general state of the economy that has people cutting back discretionary spending.
Collins said the border is a relatively new wrinkle, the product of a few stories of people having a rough time and some people being detained.
“We’re getting a lot of questions. People literally phoning us and saying, ‘what’s it like at the border crossing? Am I going to be questioned and harassed? Will I get detained?’ ” he said. “There’s this uncertainty that they’re not going to have a smooth entry and exit to the U.S.,” Collins said. “I think that’s putting travellers off. It’s certainly a question we never heard before this year.”
To date, he said, there has been no trouble reported on the route and the company has always had an excellent working relationship with both U.S. and the Canadian officials.
As far as what’s holding back U.S. travellers, Collins said it’s likely concern about the economy.“They see all of the talk about looming inflation or interest rates or downturn in the economy and job losses. And I think tourism is one of the first things to suffer in that environment,” he said.
“We’re in the sector that gets hit first when these tensions come up. You know, tourism is where people pull back their discretionary dollars.
“So you’ve got the recession worries, you’ve got the inflation worries, you’ve got the tension about border crossing and you’ve got, layered on top, the feeling of betrayal that Canadians feel right now — it’s a perfect storm to hit a business like ours.”
They are not the only ones.
Last week, Black Ball Ferry announced it would delay implementation of its full summer sailing schedule until June 26, when it intends to finally ramp up to four sailings a day between Victoria and Port Angeles, Washington.
President Ryan Burles said it has no plans to make any other adjustments to its scheduling or staffing.
David Gudgel, president of Seattle-based Kenmore Air, which flies between Washington state and B.C., including a new flight added this year between Victoria and Tacoma, said they don’t have plans to change their schedules.
“Kenmore Air serves domestic and international air routes, utilizing both float and wheeled planes with the largest share of those flights serving the San Juan Islands. Like our domestic routes, the vast majority of our international service to Victoria and Desolation Sound is sourced from the Seattle and Bellevue region,” he said. “We’ve found that this customer base is continuing to travel to B.C. and that our numbers are consistent with those of last year.
“We attribute this continued demand to the warm and welcoming hospitality offered by our friends to the north, hospitality that has not wavered in the face of tensions with the ‘other’ Washington,” he said.
Paul Nursey, chief executive at Destination Greater Victoria, said Victoria is still on pace for a very busy 2025 because of a variety of source markets.
“We have worked collectively to build a very well diversified visitor economy with new segments such as meetings, conferences, incentive travel, and sports tourism,” he said. “That being said, we take the vitality of our ferry operator partners very seriously.”
Collins said the only parts of Clipper’s business not affected by the cuts will be the sales and marketing department, which he said has the task of getting them out of the current situation, and the safety, engineering and marine teams that keep the vessels afloat.
“Without them, we can’t even leave the dock,” he said, adding there is a global shortage of trained mariners and they can’t afford to lose experienced people.
Collins said the irony of the situation is 2025 was supposed to be Clipper’s year.
“This was going to be the year where it really came together for Clipper,” he said. “We came out of COVID, it was hard work getting all of our people back, re-establishing operations, re-establishing our name in the minds of travellers and things like that. This was going to be the year where we felt we had the right people and the right schedule and the right team … then out of the blue, this occurs.”
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