Was It Choking Or Indigestion For Starlite Ferries?

Almost since its establishment I tried to monitor the Starlite Ferries which was founded by Alfonso Cusi who has Mindoro origins. Starlite Ferries was easier to track since unlike her pair Montenegro Shipping Lines Inc. which is related in a way to them in patronship, Starlite Ferries did not expand beyond Mindoro unlike the other one which can be found practically all over the Philippines (and so it has the distinction of being a national shipping line without being a liner company). Starlite Ferries, meanwhile, remained a short-distance ferry company and in this segment they basically carry rolling cargo or in layman’s term we call that as vehicles and passengers, of course.

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Starlite Pioneer by Raymond A. Lapus

Over the years of its existence, Starlite consistently added ferries to its fleet (although they had sales and disposals too) until they reached some 11 passenger ships in 2013, to wit, the Starlite Jupiter, Starlite Phoenix (a fastcraft), Starlite Juno (a fastcraft), Starlite Neptune, Starlite Polaris, Starlite Annapolis, Starlite Atlantic, Starlite Navigator, Starlite Ferry, Starlite Pacific and the Starlite Nautica. In their track record, aside from surplus ships acquired from Japan they were not anathema to buying the discards of other local shipping company like when the Shipshape/Safeship ferry dual ferry companies quit operations and they took over its fleet (but not the routes to Romblon). And from Cebu they got a ferry from the defunct FJP Lines which is better known as Palacio Lines. Actually, the first three ships of Starlite Ferries which are no longer existing now were from other local shipping companies.

However, over the years, what I noticed with Starlite Ferries is although their fleet is already relatively big by local standards they did not get out of the confines of Mindoro where they were just serving four routes. These are the Batangas-Calapan, Batangas-Puerto Galera, Batangas-Abra de Ilog and Roxas-Caticlan routes. The longest of this route is the last named that takes four hours of sailing time while the other routes take two to two-and-a-half hours depending on the ship. With such length of sailing time it can be gleaned that actually their 11 ferries is  a little bit over already than their need for the four routes.

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Starlite Reliance by Carl Jakosalem

So it came as a bombshell for me and many others that they will be getting 10 new ferries from Japan through a loan with a government loan window (and the first one, the Starlite Pioneer arrived in 2015). They were too proud of the coup and acquisition, of course, and they crowed about it in the media with all the jeers about the old ferries but I was skeptical. My first question is where will they put it. It is easy to apply for new routes but the approval is another matter. They do not own MARINA (Maritime Industry Authority), the maritime regulatory agency, it is no longer the reign of the nina bonita Maria Elena Bautista who did a lot for her patron and its pet Montenegro Lines. And I was sure the players that will be affected by their planned entry will fight tooth and nail (who wouldn’t?) and the approval process for franchises goes through public hearings anyway and if there is real opposition then it will be difficult to rig it (what are lawyers for anyway?). Getting route franchises is not as easy as getting it from a grocery shelf unless it is a missionary route which no shipping company has plied before except for motor bancas. And there is no more possibility now that a program like the “Strong Republic Nautical Highway” of Gloria which created new routes (and made it appear that old routes are “new routes”). It was the time of Noynoy when their new ferries came and Al Cusi who is identified with Gloria was out of power.

It is obvious that they can only absorb the new ferries well if they can dispose all their old ferries. But regarding the price it will be, “Are they buying or are they selling?”. That means forced selling will not gain them a good price and with the ferry structure in the country and their fleet size I am not even sure if there will be enough buyers especially when banks are averse to extending loans to shipping companies. Pinoys are averse to the breaking of still-good ships unless one’s name is starts with “A” and ends with “z” or maybe connected to 2GO (well, Negros Navigation’s case then was different as there was force majeure in it).

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Starlite Eagle by Carl Jakosalem

And they might be forced to sell their old ships if they have honor because after all the owner Al Cusi is one of the hecklers of our old ferries and pushing for their forced retirement (and the sauce for the goose should also be the sauce for the gander but then Al Cusi was not selling old ferries until his end in shipping). I thought those in government should lead by example? By 2016, with the ascension of Digong, Al Cusi was back in power and my fears of an administrative fiat to phase out old ships intensified.

Then a news item came out that they will enter the prime Ormoc route. My immediate thought was of a dogfight not only in sailing but also in the approval process of a franchise. The Ormoc route from Cebu has a lot of parallel routes competing with it (like Palompon, Baybay, Hilongos, Bato and Albuera routes) and all of them will raise a howl against the entry of an outsider especially one with good ships, naturally. I was even titillated how that will play out (it could have been a good boxing match or worse an MMA fight). But then nothing came out of that news. Well, certainly Al Cusi knows how to pick a good route, I thought, but he might have underestimated the opposition (of course, the better the route, the fiercer will be the opposition).

And then another news item was published that Starlite Ferries will go into Southeast Asia routes. Well, really? That was my thought as I had doubts again. It is Indonesia that is the most archipelagic in our region but I knew the rates there are too cheap and sometimes as ROROs there is practically no fare charged in the old ships if patrons don’t want to pay (and so I remember the problem of some of our operators in our ARMM Region where collection of fares can be a problem and rates are really so low). They wanna go there with brand-new ships, I thought? Won’t there be demand for reciprocity? Oh, well, I would welcome Indonesian ferries in our waters especially if they are liners, why not? Now, what a way of upsetting the cart, I mused. But then nothing came out of that too.

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Starlite Saturn by Raymond A. Lapus

The logical is actually to phase out his old ferries immediately as there is no way to create a bonanza of new routes given how difficult it is to secure new routes in the country and actually the situation is the feasibility of routes are limited as it is dictated by people and goods movements and not by wish, simple geography as in nearness or MARINA inducement. They can try the Pilar-Aroroy route that was validated by three titled international experts on shipping with all the feasibility study calculations but then as known by the locals it wouldn’t last and they were proven right as the route lasted only a few months (Archipelago Philippine Ferries tried it). Plus they might have to dredge Pilar port as that is shallow for their ships (the government will pass on to them their dredging responsibilities and they will be lucky to earn a thank you). MARINA has actually a lot of routes that they were promoting like the Pasacao to Burias route, the Cataingan to Maripipi route, et cetera but shipping operators not biting as they are not fools unlike some sitting in some MARINA chairs. With Starlite Ferries obliged to pay the bank amortization they cannot simply let their ships gather barnacles in Batangas Bay.

But where will he sell his old ferries? Many of the ships of Starlite Ferries are not fit to be small short-distance ferry-ROROs, the type most needed and most flexible to field (that will survive better in low-density routes) and now the problem is that is being supplanted now in many cases by the passenger-cargo LCTs and RORO Cargo LCTs which may be slow but are cheap to operate (and so many of these are arriving from China brand-new and not surplus with good terms). The reinforcements that entered San Bernardino Strait and Surigao Strait were actually LCTs (the former are operated by SulitFerry, a 2GO enterprise) and there are LCTs that are new arrivals in Tablas Strait that belong to Orange Navigation, a sister company of Besta Shipping.

Cebu won’t buy it as what is mainly needed there are overnight ships and generally bigger than what Starlite Ferries have. The actual direction of ferry sales is from Cebu to Batangas and not the other way around. It is also hard to sell the Starlite ferries to Zamboanga as only one shipping line has the capability there to buy (Aleson Shipping Line) and they have enough ships already and they can afford to buy direct from Japan. It won’t be Manila as there are no more overnight ships there remaining to Mindoro and Romblon (Starlite Ferries helped sank Moreta Shipping Lines, MBRS Lines and its successor Romblon Shipping Lines). The operators to Coron and Cuyo are not that big and the Starlite ships are too big for those routes. It is really hard to dispose of 11 ferries unless Starlite gives it on a lay-away plan but then they have to pay the bank for their new acquisitions.

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Starlite Archer by John Edmund

I feared Al Cusi with his Malacanang clout and political clout (he is vice-president of the ruling party now) will resort to administrative fiat through the Department of Transportation. But that will be bloody and when the old operators feared something was afoot with the Tugade trial balloons they were ready with deep questions like if there is a study that shows old ferries are unsafe (good question) and MARINA was put on the defensive. These old operators are not patsies, they can hire good lawyers and they have congressmen as padrinos that Tugade and Cusi cannot just push around.

And so came the announcement that there will be no phase-out of old ferries (which is nonsense anyway as phase-out should be based on technical evaluations and not on age). It seems that was a big blow to Starlite Ferries which by that time was already shouldering the burden and amortizing five new ferries with five more on the pipeline and their old ferries still around and unsold (their other new ferries are Starlite Reliance, Starlite Eagle, Starlite Saturn and Starlite Archer). Trying to force their old ferries in some near routes might just mean competing with their sister Montenegro Lines and their shared patron saint will look askance to that.

I guess the financial burden of the new ships were getting heavier by the day for Starlite Ferries. With a surplus of ferries they were even able to send Starlite Annapolis to Mandaue just to get some new engines if what I heard was true. There is really no way to cram 15 ferries (as Starlite Atlantic was lost maneuvering in a typhoon) in just four short-distance routes. I just don’t know, should have they converted some of their new ships into overnight ferries and competed in the longer Batangas to Caticlan route? But the accommodations of the former Cebu Ferries ship of 2GO are superior to them. How about the Batangas to Roxas City route that is irregularly served by Asian Marine Transport Corporation?

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The most senior now in the fleet of Starlite Ferries

But instead of fighting to resolve their problem, Al Cusi took the easy way and sold out. Well, it is never easy to finance five new ferries with five more still on the way with no new routes coming. They might drown in debt and default. Or end up just helping the bank make their living (in Tagalog, “ipinaghahanapbuhay na lang ang bangko”).

I wonder why Al Cusi did not just get two or three units for testing and evaluation and proceed slowly. With that they might have known with less pain and pressure that although their ferries are new it does not have a technological edge nor an advance over the old ferries unlike the new FastCats. They knew already that intermodal vehicles are mainly locked like the Dimple Star buses are locked to them and so newness of the ship will not easily sell and not even to private car owners whose main concern is what RORO is leaving first (and that is also the main concern of the passengers who do not even have a free choice if they are bus passengers).

It looks to me the 10 new ROROS ordered by Starlite Ferries was a simple case of indigestion or worse a choking. It looks like more of the latter and so Al Cusi spit it out and settled for a half billion pesos as consolation for the sale of Starlite Ferries to the Udenna group, the new hotshot in shipping which also owns Trans-Asia Shipping Lines of Cebu now. That might be a good decision for Udenna as their Trans-Asia Shipping Lines lacks ferries now whereas Starlite Ferries has a surplus and so it might be a good match. Converting the ships into overnight ferries is not difficult nor would it cost much although the ships of Starlite Ferries is a little small than what Trans-Asia Shipping Lines was accustomed to (but then it is also possible to lengthen the upcoming ferries).

Now I don’t really know exactly where Starlite Ferries is headed and it will not be as easy to guess that but in all likelihood a Starlite and Trans-Asia marriage might work out especially since the Udenna group has the money to smoothen out the kinks.

Nice experiment but it seems the 10 new ships was too much for Starlite Ferries to chew.

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The Cruel Loss of the Southern Mindanao Liner Routes

Talking here of Southern Mindanao ports, I am not only referring to Gensan (General Santos City) and Davao but also of Zamboanga and Cotabato which are technically Western Mindanao and Central Mindanao ports. But once the four were all closely interrelated as the routes through them are inter-connected. This connection also goes all the way to Iloilo port which was the intermediate port then of the Southern Mindanao liners.

In the late 1990’s, Davao had six liners to Manila per week which was about the same number Gensan and Zamboanga had. Cotabato had less as in only about two or three as it was not as big as the three other cities. Cotabato port, by the way, is actually the Polloc port in Parang, Maguindanao, a nearby town and not the river port in the city which is too shallow for liners.

I cannot believe that in just over a decade’s time from that all four ports will lose their liner connection to Manila or to Iloilo and Cebu. To think that since the Spanish times all had steamers from Manila with the exception of Gensan which was not yet existing then. Zamboanga has one ship a week now to Manila but several years ago she also lost her liner to Manila. The intermediate port of her liner now is Dumaguete and not Iloilo any more.

The slide first started when Negros Navigation Company (NENACO) shrunk operations due to financial difficulties. Among the routes they abandoned early were their routes to Southern Mindanao (but they held on to the Zamboanga route). The frequency they held was never filled up. Among that could be added to the early loss here was when Aleson Shipping Line of Zamboanga also dropped their liner route when they sold their Lady Mary Joy (not to be confused with the current Lady Mary Joy 1 which is a different ship) to the breakers because its run was not profitable.

But the big slide came when Sulpicio Lines got suspended in 2008 after of the floundering of the Princess of the Stars in a typhoon which drew international and local outcries. In the aftermath of that, stringent regulations were laid out for Sulpicio Lines in order for them to come back to passenger shipping. Only two liners were maintained by Sulpicio Lines after that and they withdrew from all routes in Southern Mindanao (among many other routes too).

I was saddened and worried by the departure of Sulpicio Lines. I know the passenger liner segment of shipping was weakening already as budget airlines and the intermodal buses were getting stronger but Sulpicio Lines is not the ordinary shipping company that will immediately withdraw from routes as soon as that route is no longer showing profit. It was one resilient liner that was actually needed then to shore up the weakening passenger liner sector.

I was apprehensive even then of that development because the only remaining liner company in Mindanao which is governed by bean counters is very fast in junking routes and in selling liners to breakers. Even when they fielded the SuperFerry 20 and SuperFerry 21, my apprehensions were not quelled especially since I know they are fast weakening in container shipping because they have the highest rates and new challengers with lower rates are already around and challenging them.

And I was not mistaken in that apprehension because in just over a year they withdrew from Davao but still temporarily retained Gensan. But in about one or two years’ time again they withdrew from Gensan, Cotabato and Zamboanga. With that withdrawal the Iloilo-Zamboanga route was also eliminated.

At about that time, the buses for Manila leaving Ecoland terminal in Davao grew in number. It was not just Philtranco anymore but PP Bus came and soon the so-called “colorums” followed. It was not just the budget airlines that benefited from the withdrawal of the liners.

Davao was at least more fortunate because there are many Manila flights to it and there are plenty of intermodal buses to Manila. Gensan and Cotabato was not that fortunate because even though they have planes to Manila they do not have buses to Manila. Now some people are simply afraid to take flights and some do not have the identification papers needed to board planes. Some are too terrified to enter an airport because they fear losing their way around (well, I found out there were even people who do not know how to order in Jollibee) and also be exposed as stupid barrio folks. They may not really like the buses but they dislike the plane even more.

So some Cotabato folks would take the bus to Davao and transfer to the Davao-Manila bus. People from near Cotabato City also has the option to take the commuter van to Marawi-Iligan so they can take the ship there. Some can also opt for the commuter van for Kapatagan, Lanao del Norte and from there they can connect to Ozamis which both has a ship and a plane. Well, people from Davao or Cotabato province also take the bus or commuter van to Cagayan de Oro where there is also a plane and a ship.

But what kind of cruelty is that of forcing people to travel long land distances in order to catch a ship? Maybe to ameliorate that the only liner company offered tickets to Manila which included a bus ticket of Rural Transit of Mindanao to Cagayan de Oro for a ride that is 320 kilometers from Davao.

With the loss of the Southern Mindanao liners, people also lost their transport for the intermediate routes like Davao-Zamboanga, Gensan-Zamboanga and Cotabato-Zamboanga. Also lost was the intermediate route Iloilo-Zamboanga. Taking a ship then was cheap, relaxing and one disembarks freshened (after taking a bath) and probably fed and ready for the next trip. Now one has to take the plane or the very long bus or commuter van ride.

There is a Davao-Zamboanga plane but it is more expensive than the Tourist class of the former liners. There is no Gensan-Zamboanga or Cotabato-Zamboanga plane as of the present. There is a Zamboanga-Iloilo plane but not daily and it is more expensive than the former liners. Saying it is more expensive does not even include the airport terminal fee nor the airport transfer expenses.

From Zamboanga, people now take the cruel route of a Rural Transit bus up to Bacolod which takes over a day. Mind you the ordinary bus has no comfort room nor meals on board and one is tossed around for that length of time. So the meals are extra expense (it is automatically included in the ticket of Sulpicio Lines). I tell you that ride is backbreaking and it is hard to sleep because at every terminal the bus will stop, open its lights, vendors will board or hawk and there is the general shuffling of people coming up and going down. One also had to look if his luggage is already being taken down by other people.

I also take the very difficult bus-commuter van-bus ride from Davao to Zamboanga and it is backbreaking too and lasts nearly a day if via the Narciso Ramos Highway of Lanao del Sur. The trip is longer and more expensive if it is via Cagayan de Oro. All these alternatives to the ship I am mentioning are all more expensive and the wear to the body is maybe twenty times that of the ship. One reaches his destination fagged out, dehydrated, hungry and stinky.

The Gensan-Zamboanga land trip is no less arduous than the Davao-Zamboanga land trip. Look at the map and one can see the distance is almost the same. If it is via Cagayan de Misamis the distance is even greater. It is only Cotabato-Zamboanga which is a little nearer but the distance is still about 450 kilometers and the waiting time for the commuter van to leave is long as it is basically alas-puno. There is a certain minimum number of passengers before a van will leave (it will cancel the trip if filling up takes too long or the minimum is not reached). And mind you those commuter are not even airconditioned. And in the Pagadian-Zamboanga stretch, the Rural Transit bus is oh-so-slow because there is no competition. Expect up to 12 hours for a 280-kilometer route.

This is the cruel condition left to the passengers when the only remaining liner company in Southern Mindanao jilted and left them. There was a merger again later between the last two liner companies which produced 2GO but still the liners did not return and there is no hope on the horizon that they will return.

Now if only MARINA will relent and allow again some cargo or container ships to take in passengers again that will be better but I don’t see it happening. All they know is to say they are open for new liners companies applying but entering the liner business is too unattractive for all the shipping companies. There are more regulations, more investments needed including in service people and supplies, passenger can balk at delayed arrival or of anything in the service if it is below par. And if there is an accident, for sure, the press and the social media will be baying at their door.

If MARINA knows anything about liner shipping and the plight of Southern Mindanao passengers they should even encourage Asian Marine Transport Corporation (AMTC) to take in passengers because their Cargo ROROs need no modifications to carry people. But does MARINA really know anything about passenger liner shipping? They didn’t even understand that with their too strong restrictions on Sulpicio Lines they will be killing a liner company and that there won’t be a replacement anymore.

Now that is the sad fate of us Southern Mindanao passengers.

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