The Archipelago Philippine Ferries Corporation

The Archipelago Philippine Ferries Corporation is prominent in the shipping news lately because of the hype they are giving to their new series of ships, the catamaran-RORO FastCats which are actually MSCs (Medium Speed Crafts). The acknowledged owner of Archipelago is Christopher S. Pastrana who claims he is from Matnog, Sorsogon.

In his hype of the FastCats, Mr. Pastrana often mentions he is appalled by the state of our local ferries which he described as “old and unsafe”. Reading this, I nearly fell out of my chair because from my wide knowledge of Philippine shipping it is actually Archipelago Philippine Ferries and its Maharlika series of ships which are the prime examples of old and unsafe ferries. I know this from my frequent travels from Mindanao to Bicol starting in 1998 (because I hail from Bicol) and that is where most of Mr. Pastrana’s ships were located then.

Mr. Pastrana seems to have started his interests in shipping with the CAPP Industries. Among the businesses of the that company was operating tugs and barges. Mr. Pastrana admits his first ferry acquisitions were the Maharlika I and Maharlika II from the government and this happened about 1998. It looks now that those ferries were just chartered as the listed owner in MARINA then was still the Department of Public Works and Highways (DPWH).

These Maharlika ships have a close working relationship with the buses of the Philtranco Service Enterprises, Inc. (PSEI). For the most of its existence, Philtranco buses cannot ride any other ferries in the San Bernardino Strait and Surigao Strait routes even though there are no Maharlika ferries waiting and there are available ferries of the competition. Even at the very start, there have been rumors about the true relationship of Mr. Pastrana to the owner of PSEI, Mr. Pepito Alvarez. And that might have started even with CAPP and its servicing of Philpos and PASAR in Leyte which are Alvarez companies.

Not long after the acquisition mentioned, Mr. Pastrana bought a lot in Dapdap, Allen, Northern Samar and a port was developed. They transferred operation here from the San Isidro Port in Samar which is significantly farther than Allen, Northern Samar from Matnog Port in Sorsogon (San Isidro is less competitive because of the additional distance). The Dapdap port was registered under the Philharbor Ferries and Ports Services, a sister company. Among the declared objectives of the company were the development of ports (but nothing else followed after Dapdap).

In the year 2000, came the series of ships acquisitions by Archipelago Ferries. In this year, the sister ships MV Maharlika Tres and MV Maharlika Cuatro were purchased from Aki Kisen in Japan. When they arrived, they were still relatively new by Philippine standards. The next year, the MV Lakbayan I arrived but it was relatively old and slow. Maybe the lack of speed was the reason they gave it up and the ship ended with Millennium Shipping, another company with reputed links with a former President like Archipelago Ferries, Philharbor Ferries and Philtranco and not to mention PASAR and Philphos.

In 2002, Archipelago Ferries acquired the MV Maharlika V. It was a queer purchase because Philtranco once owned that through the Luzvimin Ferry Service. It did not sail long for that company because operations was stopped when they lost in the courts. It held that a bus company still needs a franchise to operate a ferry even though it will carry only their own buses (it was a reiteration of a Supreme Court decision from American times). And Luzvimin Ferry Service do not have a franchise.

The ferry was then subsequently known as MV Christ The King before it tried its luck in Batangas. She capsized just off the port of Puerto Princesa when she was already known as the MV Mindoro Express. She was salvaged, brought to Keppel shipyard in Batangas where her superstructure was lessened. She was then renamed as the MV Maharlika V and brought to the Liloan-Lipata route which was far from where she met the accident (truth is she was not recognized there as MV Mindoro Express and nor as MV Christ The King – it was Philippine Ship Spotters Society which recognized and trace her).

The year thereafter, in 2003, Archipelago Ferries bought the MV Maharlika Seiz from Norway which was followed by MV Maharlika Siete from the same country. They were already old ships but their hulls were still strong. Their weakness is the use of CPP (Constant Pitch Propellers) which can be demanding in maintenance when it gets old but it is kind on the engines.

They used the MV Maharlika III to open new RORO routes in Bicol. They were the first short-distance ROROs from the Bicol mainland to Masbate and Catanduanes. It was even used to open the Marinduque route from Lucena (with Philtranco buses in tow). But when competition arrives, they cannot stand the heat and they pull out much like the track record of “sister company” Philtranco (well, they even go hand in hand).

MV Maharlika IV was mainly used in the Liloan-Lipata route spanning Surigao Strait. Maybe the reason was the then-sickly MV Maharlika II needed a companion in the route (before the arrival of MV Maharlika V). MV Maharlika IV was also used to relieve MV Maharlika Tres.

With the purchase of MV Maharlika VI and MV Maharlika VII, Archipelago Ferries tried the Batangas-Calapan and Roxas-Caticlan routes in Southern Tagalog (and later MIMAROPA), an expansion area for them in a new region to take advantage of the newly-opened Batangas-Mindoro-Panay intermodal connection.

Archipelago Ferries did not stop with the Maharlika series. When Phil-Nippon Kyoei closed operations and offered to sell their three ferries, Archipelago Ferries bought the MV Grand Star RORO 1 and the MV Grand Star RORO 3. They did not bother renaming these ferries. They were used to shore up their presence in San Bernardino Strait when MV Maharlika Uno can no longer sail well.

Not all the ships by Archipelago Ferries can sail in a given day because all became unreliable except for the newly-purchased Grand Star ROROs. Their custom is they sail ships even with just one of the two engines functioning. Some stop sailing and gets moored because no engine was still running like when the MV Maharlika II gathered moss in Lipata Port and clogged the wharf.

A few years ago, and even with such a sorry record, Archipelago Ferries was able to secure a big loan from the Development Bank of the Philippines (DBP), the conduit for JICA (Japan International Cooperation Agency) soft loans for our shipping modernization. This was used to order the FastCats from several shipyards in China. While waiting, Archipelago started disposing their old ferries to other shipping companies and to the breakers.

The fates of their old ships were the following: The rickety MV Maharlika Uno was sold to the breakers (after clearing with the government); the MV Maharlika II sank off Panaon Island in 2014; the MV Maharlika Tres was sold to Atienza Shipping; the MV Maharlika Cuatro was sold to Gabisan Shipping; the MV Maharlika Cinco ended up with Gabisan Shipping too after a long lay-up in General Santos City; the MV Maharlika Seiz is laid up and is for sale; the MV Maharlika Siete was sold to a Navotas yard specializing in breaking; the MV Grand Star RORO 1 was sold to Regina Shipping Lines and MV Grand Star RORO 3 was disposed off to another company.

By the time the FastCats arrived they were no longer running the Batangas-Calapan and Roxas-Caticlan routes. At that time they were just running the Matnog-Allen and Liloan-Lipata routes where the Philtranco buses roll (before 2010 Philtranco already quit their Panay routes even though they were pioneers there; same story too with their Marinduque, Catanduanes and Masbate routes which they all abandoned much earlier).

In 2014, their FastCats started arriving. Its first route was Batangas-Calapan. Today, their ten ordered FastCats have all arrived and they are active in the Batangas-Calapan, Bulalacao-Caticlan, Matnog-San Isidro, Liloan-Lipata and Bacolod-Iloilo routes (although some waited for months in Batangas Bay waiting for their own-use docking spaces in applied ports). They are also applying for other routes at the moment and they have one approved but unserved route, the Dumaguete-Dapitan route. Meanwhile, they announced they will acquire more FastCats and expand to Southeast Asia.

Recently, they also applied with MARINA that Archipelago Philippine Ferries be recognized as a “new” company. Maybe they want to bury their sordid past when their ferries were one of the rustiest, one of the dirtier (and even smelly), one of the most unreliable and one with no passenger service to speak of. But to be fair to them, their ferries then don’t sink until they got caught in Surigao Strait in 2014.

Today, their fleet is all brand-new, it is spic and span, and the crew are well-trained and prim. I asked one of the crewmen about their old ferries and he seems to have amnesia. Feigned or not, I do not know. I am sure they would like to bury their past which they can never be proud of. And that is fair game. Many companies abroad did that. I just wonder why not just use a new name? Maybe they can’t because it was the name used for the loans.

Will they be successful? P240 million for each FastCat is a big amount to recoup. For a route like Batangas-Calapan where ferries sail 24 hours and with plenty of rolling cargo that is no problem. But for routes where they can only do two short round-trips a day that raise questions especially if the route is seasonal (which means strong only in summer, the semestral break and in December).

FastCats might be new and attractive but trucks and buses (not the sedans and SUVs) dominate the short-distance intermodal rolling cargo and for these the price point is the main point of decision (the bus passengers don’t decide the RORO their bus will take). Many of the regulars are actually already tied up in “special rate” deals with short-distance ferry-RORO companies which means it is not really an open market.

For them to survive they should not only forget the old Archipelago name but also forget the old ways of doing things. They have already resolved their problem with cleanliness, in passenger service and in reliability. Can they stand the heat of competition that have basically recouped their ships’ capital? That we have to see.

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