Why Merak Ferry Operators Demand Fare Hikes

Why Merak Ferry Operators Demand Fare Hikes

Industry Calls for Immediate Rate Adjustment Amid Rising Costs

Why Merak Ferry Operators Demand Fare - TEMPO.CO, Jakarta – The Merak branch of the National Association of River, Lake, and Cross-Border Transportation Entrepreneurs (Gapasdap) has called for an urgent revision of ferry crossing rates. This request comes as operators face mounting pressure from a significant increase in operational expenses, which have surged due to economic factors affecting the rupiah. The association argues that without intervention, the sector risks financial instability and reduced service quality.

Cost Pressures Linked to Currency Fluctuations

According to Togar Napitupulu, the chairperson of Gapasdap’s Merak branch, the financial strain on ferry operators is primarily driven by the fluctuating value of the US dollar against the rupiah. This exchange rate volatility has led to higher prices for essential components, including fuel and imported parts. As a result, maintenance and procurement costs have risen sharply, impacting the profitability of ferry services.

Togar emphasized that these cost increases are not isolated but part of a broader trend. He noted that fuel prices alone have climbed by up to 60 percent, while spare parts have seen a 30 to 40 percent hike. Docking and ship classification renewal expenses have also gone up by approximately 20 percent, further compounding the financial burden. These pressures are forcing operators to reconsider their current pricing strategies to remain viable.

Current Rates Fall Short of Operational Demands

Togar highlighted a critical discrepancy between the current fare structure and the actual expenses incurred by ferry companies. He stated that the existing rates fail to cover the full range of operational costs, which are essential for maintaining safety and service standards. “The current ferry crossing rates do not reflect the operational costs that companies have to bear at all,” he explained in a statement issued in Serang, Banten, on Saturday, June 20, 2026, as reported by Antara.

“Meeting these various cost components is mandatory to fulfill safety standards,” Togar added. This assertion underscores the need for a more equitable pricing model that aligns with the financial realities of the industry. The association’s data suggests that the fares remain around 31.8 percent below the Cost of Goods Sold (COGS), a gap that has persisted for over seven years without resolution.

Legal Mandates and Financial Strain

Despite the rising costs, ferry operators are still obligated to uphold service, security, and safety standards as outlined in Law Number 17 of 2008 concerning Shipping. This legal requirement ensures high-quality operations but places additional strain on already tight budgets. Togar noted that the combination of these mandates and inflationary pressures has left many companies struggling to balance their books.

Another challenge arises from the growing number of vessels operating on the same route. This has led to a decrease in voyage frequency, limiting each ship’s ability to generate revenue. Operators are forced to spread their fixed costs across fewer trips, which reduces their profitability. The situation is compounded by the need to maintain regular schedules and meet regulatory compliance, creating a cycle of financial strain.

Proposed Incentives to Alleviate Burden

Alongside the demand for higher fares, Gapasdap has suggested a range of incentives to ease the financial burden on ferry companies. These include the elimination of Non-Tax State Revenue (PNBP), the removal of fuel tax, and a reduction in port and classification fees. By implementing these measures, the association believes the government can help operators stabilize their finances while maintaining service quality.

Additionally, the proposal calls for the provision of low-interest credit facilities tailored to the maritime sector. Togar pointed to examples from neighboring countries where such support has been effective in sustaining industry growth. “These incentives would not only reduce immediate costs but also encourage long-term investment in infrastructure and technology,” he stated.

Broader Implications for the Sector

The demand for fare hikes and financial support reflects a growing concern among ferry operators about the sustainability of their business model. If the government does not act, the industry may face a decline in service frequency, which could affect millions of passengers relying on the Merak route for daily commutes and cargo transport. The route connects the mainland to the island of Java, making it a vital artery for regional trade and mobility.

Togar also warned that failing to address these issues could lead to a reduction in the number of operating vessels, potentially creating bottlenecks in transportation. This would not only impact economic activity but also increase the cost per trip for remaining operators, who might be forced to raise prices further or cut corners on safety measures.

Industry-Wide Response and Future Outlook

The Merak branch’s call for action has sparked discussions within the broader transportation sector. While some operators support the demand for higher fares, others argue that the government should take a more proactive role in subsidizing costs to ensure affordability for both passengers and companies. Togar acknowledged the need for a balanced approach, stating that the solution should account for the interests of all stakeholders.

“The government must recognize the challenges we face and take steps to support the industry,” he said. “This includes revising tariffs and introducing financial incentives that reflect the current economic environment.” The association is also urging policymakers to conduct a comprehensive review of the maritime sector’s financial health, incorporating input from operators and experts to create a sustainable framework.

As the debate continues, the outcome of this situation could have far-reaching effects on Indonesia’s transportation infrastructure. With the Merak route serving as a critical link between regions, any changes to its pricing structure will likely influence other parts of the industry. The government’s response to this demand may serve as a model for addressing similar issues in other transportation sectors.

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