Company claims $5m loss
GOUNDAR Shipping managing director George Goundar claims fuel price increases and associated costs have resulted in a loss of $5 million for his business over the past two years.
As a result, he has put a hold on franchise and private runs to Northern Lau, Yasayasa Moala and Rotuma.
Mr Goundar said the company would cease operations to those areas until the price of fuel came down “to a reasonable amount”.
“I’m not going to run my company down the hole when I don’t have to and I can’t run my vessel down on a loss then send over 300 people home and file for bankruptcy,” he said.
“We’ve got shipping up to a level where people are demanding service but somebody has to pay for it.
“We would go to Rotuma once a week and service the other two areas every two weeks and the numbers would not even reach 100, it would be between 50-80 people for each trip.”
Mr Goundar said under a franchise arrangement, Government had been giving the company $11,000 to service Yasayasa Moala, $18,000 for Northern Lau and $25,000 for Rotuma.
“For me to go to Yasayasa, it’s about 14,000–15,000 litres two ways and that’s how much it burns, times the price of $2.80$3.00, and $45,000 is just for the fuel cost alone.
“The company is getting $11,000; do you think it’s worthwhile to run the business.”
Mr Goundar said his franchise contract was due for renewal next month and if the Government was not willing to raise the subsidy, then there was no point in carrying on services.
Questions sent to Transport Minister Faiyaz Koya yesterday on the comments made by Mr Goundar remain unanswered.