Penang government’s ferry takeover offer: What’s holding it up?


Commuters using the ferry service in Penang are suffering interminable delays following a reduction in the number of ferries in service.

The Penang state government has offered to take over the privatised ferry service and increase the number of ferries. But it has reportedly not heard anything since meetings were held.

The question is, who was in those meetings and were all the relevant parties represented?

There are three parties that have to be involved in any takeover plan:

  • the Penang state government, which wants to take over the operations;
  • the privatised Penang Port Sdn Bhd (PPSB), which operates the port, including the ferry service, and
  • the regulator, Penang Port Commission, which comes under the federal Ministry of Transport

What exactly is holding up the takeover of the ferry service while daily commuters continue to wait in misery at the ferry terminals?

From what I understand, each time a ferry makes a trip, PPSB loses about RM600. It may be losing some RM20m-25m a year from the ferry operations.

So to cut losses, PPSB has simply reduced the number of ferries to a skeleton service. From a dozen ferries in operation in the heyday of the ferry service in the 1970s and for much of the 1980s, today only four ferries out of a fleet of six are in operation during peak hours.

And after 10pm daily, only one ferry is in service and after 1am, none – even during weekends and public holidays! (Part of the problem is there are fewer cars heading to the island at night while more cars are heading to Butterworth, but ferry fares are only collected, on the mainland, from commuters heading to the island. No fare is collected on the island from commuters heading to the mainland, as that is the same system adopted for the two Penang bridges.)

This cutback in the ferry service is one reason why the privatisation of Penang port should never have taken place.

So now, given that PPSB is losing money from the ferries, I doubt if the firm, focused on maximising profits, would have much objection to the Penang state government taking over the ferry service. So who or what is delaying the takeover?

In the past, before the privatisation of Penang port, it was not a problem for the ferries to make a loss. Penang port would simply cross-subsidise the ferry service using funds from the profitable port operations. But with the ill-advised privatisation of the port to Al-Bukhary’s Sea Terminal – despite the Penang state government’s willingness to take over the port – that cross-subsidy with the ferries is no longer there as the profit maximisation motive is firmly in place.

The loss-making ferry service is simply being run down while commuters suffer.

But there is no reason why the ferry service cannot break-even if it is run efficiently, even based on existing fares.

For one thing, I understand each ferry is staffed by a crew of nine and this is probably due to harbour regulations (perhaps for safety reasons or to assist in any emergency?).

This headcount can possibly be reduced to five. During docking, embarkation, and disembarkation, personnel inside the terminals can board the ferries and assist in guiding vehicles in and out. The headcount can be reduced gradually upon staff retirement without any need for retrenchments.

To deal with emergencies, a Penang port rapid response team equipped with a speedboat can be put on standby at the terminals. After all, it would take less than five minutes for a rescue team on a speedboat to reach any ferry in distress.

Once operational losses are minimised, the ferry service can be expanded in creative ways to service other destinations on Province Wellesley and Penang Island, not just George Town and Bagan Dalam in Butterworth.

New ferry terminals can be set up in Tanjung Bungah, Bagan Ajam, Prai and Bayan Lepas to ease congestion on existing highways and roads. These terminals should be integrated with the Rapid Penang bus service and other public transport modes. i doubt if the Penang transport masterplan has fully explored the full potential of the ferry service.

With more ferries, economies of scale can be realised, and losses reduced or eliminated.

In any case, with sustainable public transport, it is not essential for it to make a profit as it is an essential public service, which should be subsidised if necessary for the common good (less vehicular pollution, less time wasted waiting at ferry terminals, less traffic congestion, and a smoother overall integration with other modes of public transport).

The medium-term plan should be for the Penang bridges, old and new, to be handed over to the Penang state government. The tolls from the bridge can then serve as a form of congestion charge, which can be used to finance public transport infrastructure and operations in the state under the Penang state government.

This sort of sustainable public transport coordination should come under a new Penang Sustainable Transport Commisson, whose responsibilities should include getting the ferry service, KTM and Rapid Penang to work together and integrate the commuting experience.

This is not something new; we had something like this in the past. You could hop on a bus or tram to Weld Quay, book your train ticket there, board the ferry at the then railway jetty (located near the present ferry terminal), and the old ferry would then chug across the channel to the Prai harbour, where you would then transfer to a train at the Prai Junction Railway Station. (The Butterworth Railway Station was only opened in 1967.)

So we need to get back to such integration now. KTM should work with Rapid Penang and the ferry service to allow smaller feeder buses from the KTM commuter and electric trains to transfer passengers from the mainland to the island and vice versa. The new Rapid Penang bus terminals outside the ferry terminals offer an excellent opportunity for this to happen.

It can be done if we are not obsessed with making huge profits or building expensive infrastructure (e.g. a tunnel). Remember the concept of public service? Not everything should be measured in terms of ringgit and sen.

So let the Penang state government take over the ferry service without any further delay.

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4 Nov 2015 10.43am

Let the state government take over and see improvements in no time.
To make profits, you must reinvest, and increase the trips.

4 Nov 2015 10.32am

Let the state government operate the service, surely more ferries will be added in short time, and probably can put aside the tunnel plans.
Like the symbolic green ferry of Hong Kong, Penang should retain the service.
The country have introduced many forms of transportation, and the Penang ferry is unique.
Many people have not had the experience of taking a ferry, the nausea feeling.
Penang, although is now governed by the opposition,is still part of Malaysia, and should be fully supported and not sabotaged by the federal.

gk ong
gk ong
3 Nov 2015 11.34am

Last week at 5pm I waited almost 45 mins at the island side for the ferry!

3 Nov 2015 10.43am

give me the ferries a want to do floating restaurants so that diners can enjoy beautiful night views of the island.

3 Nov 2015 6.49am

while I agree with most of your article I must take issue with “To deal with emergencies, a Penang port rapid response team equipped with a speedboat can be put on standby at the terminals. After all, it would take less than five minutes for a rescue team on a speedboat to reach any ferry in distress.”

– what exactly can a speedboat do for a ferry load of sat 50+ people?

Johan Khun Pana
Johan Khun Pana
2 Nov 2015 6.55pm

While somebody is playing the delaying game.
Is there or was there a study of the cost and efficiency of using passenger hovercraft or hydrofoil.
Similar to HK-Macao’s passenger sea route transport.
Older ferries may be retain for bulk transport.
While on the subject of mass transport, the federal govt deem it fit to increase train/LRT/monorail fares !
Najib’s 6 % tax not good enough to chip into public transport?
And the GST is not benefiting Sabah and Sarawak.

2 Nov 2015 6.50pm

there should a combo ticket for a food tour to mainland or penang evening boat ride to see day and night scenes

Lesley Lee
Lesley Lee
2 Nov 2015 6.15pm

We recently caught the train to Butterworth and then the ferry across to the island. Two things were disappointing about the integration (lack of). Firstly, it’s almost impossible for anyone with low mobility (or in a wheelchair) to make the change from station to ferry terminal as there are steps to go up and then down, before wheelchairs and a buggy are available! Secondly, we had to wait almost an hour to get on to the ferry, standing in the queue. We wer OK, but I really felt for the elderly, the young and the immobile.

Tay Teh
Tay Teh
2 Nov 2015 5.35pm

Good suggestion to make it a try rather than running a loss every year in and year out by the present admistration. It’s high time to relook into the application process may be the latter will incur from loss to profit in the name of cat admistration.

2 Nov 2015 5.30pm

Another good write up from Anil! Now the people want the authorities to answer !

2 Nov 2015 5.21pm

Penang Ferries is iconic, but the federal-state on going unresolved tussle is a ticking time bomb to make the ferries historical monument for stationary display at museum on day?

2 Nov 2015 5.17pm

Ferry fare round trip RM1.20 for non-vehicle passengers. If one takes good look of fare collection (no receipt but slow process of inserting only old coins delaying and prolonging the q, why?), there may be no transparency of actual revenue ?