Freight decline at Oceanex 'nothing like we've seen,' says chairman
Sid Hynes describes big drop in shipments of vehicles and other consumer goods
The executive chairman of Oceanex says a drop in the volume of consumer goods being transported to Newfoundland and Labrador is "nothing like we've seen in recent times."
On a year-over-year basis, said Sid Hynes, the number of automobiles shipped by his vessels into the province for the first two months of 2019 is down by 15 per cent, while freight — everything from food to building materials — is down by 10 per cent.
"You don't nail it together if we don't bring it in," Hynes said.
So how significant are these numbers?
Hynes said declines of two to three per cent are not unusual, but "nothing to this extent."
No signs of recovery
After two years of stable volumes, Hynes said, he began noticing a slowdown last summer, and there's no sign of a recovery.
Since Oceanex is responsible for delivering large quantities of freight to the province, it's another clear sign of an economic slowdown that's hitting everything from vehicle sales and home construction/renovation to the delivery of recreational vehicles such as travel trailers.
"That's an indication people are spending less," said Hynes.
The story is similar at Marine Atlantic, the Crown corporation that operates the constitutionally mandated ferry service between Nova Scotia and Newfoundland.
Combined, passenger and commercial traffic from April 1, 2018, to February 2019 was down 4.2 per cent from the same time frame a year earlier, said a spokesperson.
We're a reflection of what everybody is facing. It's a new norm.- Sid Hynes
Passenger traffic alone dropped 6.5 per cent.
Marine Atlantic transports roughly half of all goods that enter the province.
Like many business leaders, Hynes is looking at ways to reduce cost, and he would not rule out layoffs.
"Obviously we have to do things smarter," he said. "We're a reflection of what everybody is facing. It's a new norm."
Crosbie weighs in
During Wednesday's question period at the House of Assembly, Opposition leader Ches Crosbie had questions locked and loaded for Premier Dwight Ball about Hynes' position on the current state of the province's economy.
"Yesterday, multiple ministers ... dismissed concerns about the state of the provincial economy, and today the Chairman of Oceanex is in the media saying that the drop in shipments of consumer goods to the province is nothing like what we've seen in recent times," Crosbie said.
"I would ask the premier, how does he reconcile this evidence with the rosy condition the government claims for the economy?"
Ball fired back, saying the economy was faltering in 2015 under the PC government, and the Liberal party is fixing its mistakes.
"We have put in place The Way Forward, which is our vision for growth and sustainability for Newfoundland and Labrador, and this includes economic diversification," he said.
"We're starting to turn this economy around. Newfoundland and Labrador will lead the country in GDP in 2019."