Ukraine’s Danube shipping company mulls getting rid of passenger fleet

The Ukrainian Danube shipping company has announced that it does not rule out selling out its entire passenger fleet for reasons of economic feasibility.

Passenger traffic has been steadily taking a toll on the Danube shipping industry since 2014, with losses of about UA 30 million ($810 million) per season in the record-breaking years of 2018 and 2019.

In 2022, when Russia launched its full-scale invasion of Ukraine, the losses were estimated at UAH 25 million ($680 million).

"The ratio of costs to revenues that the fleet can bring in is not equal. That's why today we are considering various options of what to do with the passenger fleet," Ruslan Skriabin, deputy director general for fleet operations at the Ukrainian Danube shipping company, said in a statement.

The Danube passenger fleet consists of a pleasure boat and four passenger ships, with two of them in need of repair estimated at 800,000 euros and the other two currently used as temporary housing for the company's employees in Izmail, a city in the southern Odesa region of Ukraine, where it is headquartered.

Since the company does not have a licence to operate the passenger fleet on its own, it has in the past negotiated cooperation with charterers. One of them ordered one vessel for 2023, while at least three orders are needed for the company to break even.

Among the options considered by the Ukrainian Danube shipping company is an open tender to be held in 2024 and, in case it fails, possible sale of the vessels.

"It is much more profitable for the company to get a few million euros and strengthen the cargo fleet, which operates at a large profit, by getting rid of an asset that generates and will generate only losses," the company explained in a statement.

The Ukrainian Danube shipping company is one of the largest shipping companies in Ukraine and the Danube region. It operates on the Danube river section 2400 kilometres long, stretching up to Kelkheim, a German port.

The company owns a fleet of 75 self-propelled vessels and 245 non-self-propelled vessels.