Dubai bails out P&O Ferries with more than £400m in loans

Dover-Calais operator turns to DP World after sacking nearly 800 seafarers

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P&O Ferries has received more than £400m in loans from its Dubai owner since it sacked UK workers and replaced them with cheaper foreign staff.
Accounts for P&O show the Dover-Calais ferry operator has turned to the state-backed DP World three times for support since the dismissals in March 2022.
P&O sparked a backlash from politicians and union chiefs when it sacked nearly 800 seafarers via text message and then replaced them with cheaper staff.  Peter Hebblethwaite, chief executive of P&O, later admitted that he deliberately chose to ignore rules in failing to consult with unions on the process.
However, P&O said its latest accounts confirm that it would have faced certain collapse if the mass lay-offs had been delayed.
A spokesman said: “Our 2022 financial accounts show the challenges faced by the business at that time, and why the business needed to transform into a competitive operator with a sustainable long-term future.”
The Companies House filings show that the firm was in breach of covenants on external debt at the end of 2022 and remained so until earlier this year.
While P&O booked crew restructuring costs of £47m, the accounts showed it posted a £249m loss after tax in the year it sacked almost 800 staff. That was about £125m less than it suffered a year earlier.
As political pressure mounted in the wake of the dismissals, a loan from DP World was increased from £130m to £295m and later to £365m. A further temporary loan of £77m followed in April this year.
P&O said its business is making a strong recovery and is now “on the path to operational profitability”.
Recent measures have included the introduction of two hybrid vessels on cross-Channel services and the opening of a new freight-only route between London and Rotterdam.
The spokesman said: “P&O Ferries has taken steps to adjust to new market conditions, matching our capacity to demand and adopting a more flexible operating model that enables us to better serve our customers.”
Still, changes in French law limiting deployments at sea and making shore leave mandatory threaten to increase costs again by making it all but impossible for P&O to continue relying on seafarers flown in from Asia.
The firm’s actions remain controversial, with Louise Haigh,the Transport Secretary, last month calling for a boycott of its services following the launch of legislation on workers’ rights.
DP World responded by threatening to pull out of Labour’s much heralded investment summit and pause £1bn of spending on London Gateway port. Sir Keir Starmer was forced to intervene, stating that Ms Haigh’s stance was “not the view of the Government.”
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