Ducktours cries foul over loss of Singapore River water taxi tender

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http://www.todayonline.com/Hotnews/EDC120727-0000040/Ducktours-cries-foul

After operating cruises along the Singapore River for the past four-and-a-half years, Singapore Ducktours will be stopping its HiPPO River Cruises in the area - not before crying foul over the Urban Redevelopment Authority's (URA) tender exercise after it did not win the bid to run water taxi services.

Among other things, it took issue with the emphasis on bid price instead of the bidder's track record and argued that the requirements - including the S$3 price cap on the standard service - would make operations financially unsustainable, with potential annual losses of between S$1 million and S$1.6 million.

Yesterday, Ducktours - which also runs other cruises and tours here - took out an advertisement in this newspaper to inform readers that it is ceasing operations on the Singapore River in December.

Referring to the URA tender - which was put up in December last year - the ad stated: "We put forth a bid we believed was business sustainable. We lost."

On Wednesday, Ducktours set up a blog - publishing eight entries at one go to provide details of the tender that it took issue with.

It also put up an open letter - signed by Ducktours Chief Executive James Heng - to Prime Minister Lee Hsien Loong to appeal for a review of the tender, which has been awarded to Global Yellow Pages Limited & Leisure Empire Pte Ltd and Singapore River Cruise Pte Ltd.

The water taxi services will commence in January. When contacted, Ducktours Deputy Director Pamela Wee said it had little choice but to go public.

"We have only five months to move out of the river. We need to inform our trade partners and customers of our exit," said Ms Wee.

She added that the blog was set up to share, among other things, "the rationale behind our bid and the feedback we have given to the authorities".

Responding to TODAY's queries, a URA spokesman explained that the price cap on the river taxi services were needed to ensure affordability and encourage people to use the services when moving around the Singapore River and Marina Bay area.

Still, Ms Wee pointed out that services targeted at tourists will be cannabalised under the tender requirements.

She said: "With a S$3 water taxi service available at all times, the tourist market (priced at S$18) will be cannibalised. Tourists will opt for the more affordable S$3 water taxi's DIY tour and tour agencies will also have the same problem of incorporating an S$18 cruise into their tour package."

"As incumbent, we know the cost, we know the potential loss, we factored that into our bid and we were out-bidded," she said.

The URA spokesman said the tender was awarded "after careful evaluation which included study of the design of the routes offered and cost competitiveness".

National University of Singapore (NUS) transport expert Lee Der Horng felt that Singapore's road traffic conditions "is not so bad for people to consider water taxis that seriously".

But Dr Park Byung Joon, head of urban transport management programme at UniSIM's School of Business, felt that is was "pessimistic" for Ducktours to project just 300 daily passengers. "It looks if they are overlooking the fact that such low fare may increase the number of leisure riders," he said.