Award-winning boats firm says Scottish Canals has scuppered its hopes.

Happier days for Capercaillie, when managing director Tim Ford, front of house manager Gail Jones and  operations manager Ron Rusack were gearing up for awards success.
Happier days for Capercaillie, when managing director Tim Ford, front of house manager Gail Jones and operations manager Ron Rusack were gearing up for awards success.

An award-winning Falkirk canal boats firm is quitting Scotland, amid claims that a proposed hike in charges makes it impossible to keep trading.

The decision follows last week’s assertion by Capercaillie Cruisers Ltd (CCL) managing director Tim Ford that major planned increases meant the firm would no longer be able to make a profit.

It means that after the end of this season the 21-strong Capercaillie fleet – operating on both the Forth and Clyde and Union Canals – will either be run by another operator, or will be gone.

Five full time and 15 seasonal jobs are involved.

Scottish Canals has slammed the decision as “premature”, arguing it has done its best to achieve “fair and transparent” prices – and now aims to try and refloat the service offered by Capercaillie by negotiating with boat operators in England.

As reported in Falkirk Herald last week the abrupt demise of one of the area’s leading tourism businesses - a previous winner of a prestigious Falkirk Herald Business Award – follows a simmering row over Scottish Canals’ plans to charge Capercaillie significantly more for running its service.

Neither party has given any detail of either existing charges or proposed new rates.

But in a statement the firm said: “Scottish Canals placed restrictions on the boat numbers at the Falkirk Wheel and this has removed any confidence about growth and long-term sustainability”, adding “the relationship between CCL and Scottish Canals has effectively broken down”.

It concluded: “In view of this, the CCL Board asked the Re-Union Canal Boats Ltd Board, as the majority shareholder and as a Scottish charity, to consider these revised terms and issues as a matter of urgency.”

Both boards agreed that CCL did not have a long term trading future, and that proposed changes to leasing agreements would open up potential liabilities well beyond CCL’s resources.

CCL aims to honour its commitments to its holiday customers over the forthcoming season, and wants to thank its staff, partners and supporters for their efforts over the last eight years.

Meanwhile the firm says it is happy to discuss any offers from interested parties, adding “it will be a sad day for the current team and the future of the Lowland Canals if all of the hire boats disappear down south at the end of 2017.”

The holiday boat fleet includes Capercaillie-owned boats and a franchise operation with three companies - ABC, Black Prince and Marine Cruises.

The firm says that over the last eight seasons it has become recognised as a provider of excellent customer service and increased profitability.

Scottish Canals complains it had offered to bring independent negotiation to bear, and that it had tried to explain how much it really costs to run its operation versus what Capercaillie has paid up till now.

A spokeswoman said: “We made it perfectly clear, both in writing and during any meeting we had with Capercaillie, that these costs were simply a starting point for negotiations and not what we expected them to pay.”

She added: “Unfortunately before we were able to agree a reasonable settlement for both parties, Capercaillie has decided to walk away from the negotiating table prematurely” – she says despite “numerous attempts” to relaunch talks.

The spokeswoman added: “It is important to note that Capercaillie has been actively trying to sell the business for the past two years, and have approached Scottish Canals twice over that period offering to sell it to us.

“We engaged in a positive dialogue on both occasions but unfortunately the present owners had, in our view, excessive expectations of what their business was worth as they only own three out of the 19 vessels which they currently operate. The other boats are owned by third party operators based in England.”

Scottish Canals says it will “do all it can” to keep a hire boat fleet afloat on Lowland Canals, and negotiate a deal with operators in England.

It says it hopes to secure existing jobs provided by Capercaillie, and minimise the economic impact of the firm’s decision to quit.