New York City will launch a new ferry service by the summer of 2017.

Mayor Bill de Blasio announced a six-year contract with the San Francisco-based ferry operator Hornblower Inc. on Wednesday. The company currently runs cruises to the Statue of Liberty.

Thanks to a city subsidy, a ferry ride with the new service will cost $2.75, the same as the subway.

New York Water Taxi lost its bid for the contract and says it will likely go out of business. The company's executive Vice President Peter Ebright says the company can't compete with the subsidized fare.

"This is creating, again, a subsidized monopoly on New York Harbor that will create a very difficult environment for every other operator on the harbor as well," Ebright said. "Regardless of whether you serve those exact same routes or not, you are still going to get squeezed."

But Mayor de Blasio doesn't see it that way.

"The notion of a competitive business saying it doesn't want competition doesn't make sense to me," de Blasio said at a Wednesday press conference.

The city plans to add two more ferry routes to the Bronx and the Lower East Side of Manhattan in 2018.

With reporting from the Associated Press.