Visitors to Mackinac Island this season may be left wanting more options for transportation, following the temporary suspension of the Mackinac Island Ferry Company’s services.
“If the supply is going to be so drastically reduced, then the consequences on the consumer would be very similar to what a monopoly would have,” said Aradhna Krishna, an economics professor at the University of Michigan’s Ross School of Business.
Both of the island’s ferry services are owned by the Hoffmann Family of Companies, a Florida-based group that operates a dozen other marine services offering public transportation and private rentals. They already owned Shepler’s Mackinac Island Ferry and purchased the Mackinac Island Ferry Company (formally Star Line) earlier this summer.
The situation highlights the risks faced by consumers when one company essentially controls access to a popular destination like Mackinac Island.
“The things we worry about is the consumers getting hurt by higher prices, lower schedules, worse service,” said Ari Shwayder, an economics professor at the Ross School of Business.
Shwayder says that the situation shows how limited options can leave consumers without much recourse.
“Now, because there’s only one company that’s running ferries, maybe either the schedule gets reduced or all those ferries are now sold out, because they’re all overloaded with all the people that want to take that trip,” he said. “And so that person now, even though they were willing to pay for the ticket, can’t actually get on the ferry.”
Chris Shepler, president of Shepler’s and the Mackinac Island Ferry Co., pointed to the services’ agreement with Mackinac Island that requires the ferry services to have their rates and schedules approved by the city council each year.
If the council determines that no competition in the market exists, they have the right to change the companies’ schedule or fares.
“For all those that are saying the reason why Mackinac Island Ferry Company was shut down was because it’s a monopoly, and they’re trying to force everyone over here — it couldn’t be farther from the truth,” he said.
Shepler says the decision to suspend service came after maintenance delays caused inconsistent service for some passengers.
“We found ourselves waking up in the morning and finding out which boat started, which boat didn’t, which boat is going to make it through the day without breaking down,” he said. “And then when that started to happen — and it wasn’t just one day, it was every day — and all of a sudden we had no boats.”
Shepler also says that price increases have not yet been considered by the company, but that they could change in coming years to keep up with the cost of business.
“That’s not even been in in our discussion,” he said. “I think there’s some pricing that we see with Star Line, or Mackinac Island Ferry Company, that really doesn’t fit with what we’re doing. That may change, Star Line’s pricing may change a bit, but I don’t foresee our pricing changing at all for the 2025 seasons.”