Hong Kong’s Star Ferry, a maritime transport icon with a history spanning 128 years, is facing significant financial challenges amid rising operating costs and shifting commuter patterns. In response, the ferry operator has proposed a fare increase and new service options as strategies to improve its financial stability.
In March, Star Ferry submitted an application to raise fares by approximately 30 percent on its two primary routes, seeking to increase charges by 80 cents to HK$2 per trip. The request was outlined in a government paper ahead of a July 17 Legislative Council transport panel meeting. The operator cited increased expenses related to staff wages, fuel, and maintenance, including engine replacements, as key factors driving the proposal.
The fare adjustment aims to help the company recover from sustained losses. Between 2018 and 2023, Star Ferry reported a cumulative loss of HK$100 million, with profit margins declining from 6.4 percent to 3.7 percent over this period. The fare hike implemented earlier in 2023 contributed to returning the company to a modest profit, offering a crucial financial lifeline.
Despite its historic significance and relatively low fares, Star Ferry faces ongoing challenges. Passenger numbers remain about 20 percent below 2018 levels, largely due to the expansion of the cross-harbour MTR network, which offers faster and more frequent service. This decline in ridership has compounded financial pressures and highlights the need for sustainable solutions beyond fare increases.
Authorities have previously intervened to regulate fare changes, exemplified by the recent capping of similar increases requested by outlying ferry operators. This underscores a cautious approach to balancing affordability for commuters with the operational needs of ferry services.
In addition to the fare proposal, Star Ferry plans to maintain concessions for eligible elderly and disabled passengers through the government’s HK$2 concession scheme, ensuring continued accessibility for vulnerable groups. The operator is also exploring revenue diversification opportunities, including launching a pet-friendly service between Wan Chai and Tsim Sha Tsui, requiring a HK$25 pass.
Further initiatives under consideration involve transforming ferry piers into cultural and entertainment hubs to attract new visitors and generate additional income streams. These efforts reflect a broader strategy to enhance the company’s financial resilience while preserving the ferry’s role as a key element of Hong Kong’s transport network and cultural identity.
As Star Ferry navigates these challenges, balancing fare adjustments with innovative services and government regulation will be critical to securing its future in the city’s evolving transit landscape.