The First “Great” Merger: The Failed Saga of WG&A and CFC

When WG&A was formed it was ostensibly to combat the entry of foreign shipping companies on local inter-island routes. That was the time of many so-called “deregulation” initiatives of Fidel V. Ramos. But even then I had doubts about this as an cabotage law was in effect in the Philippines. Cabotage effectively prevents foreign shipping companies from plying local routes. And to repeal it an act of Congress is needed and I heavily doubted then that the Philippine Congress will go along with that.

It is generally accepted that it was Aboitiz Shipping that proposed this big merger. Rumors had it that the biggest shipping company, Sulpicio Lines, which was also Cebu-based was also invited but it refused and preferred to go it all alone.

The merger brought together the second, third and fourth-biggest shipping companies in the Philippines reckoned by passenger and cargo operations out of a total of five long-distance liner companies (but may I note which is in fourth place might be disputed by Negros Navigation). It had the effect of lowering the number of long-distance passenger shipping companies from five to three.

The merged company and its subsidiaries were the biggest shipping combine that ever existed in the Philippines in terms of fleet and in terms of route network. It significantly brought to that Visayas-Mindanao and intra-Visayas routes and High Speed Craft(HSC) operations. For the former, the Cebu Ferries Corp. (CFC) was formed and for the latter SuperCat was retained.

Brought into the merger were the following ferries (including their former routes):

WILLIAM LINES INC.
Mabuhay 1 (Manila-Cebu and Manila-Iloilo)
Mabuhay 2 ((Mnl-Surigao-Butuan-Tagbilaran-Mnl and Mnl-Tagbilaran-CDO)
Mabuhay 3 (Manila-Davao-Dadiangas-Manila and Manila-CDO-Iloilo-Manila)
Mabuhay 5 [after a few voyages permanent fielding overtaken by merger]
Dona Virginia (Manila-Dumaguete-Ozamis-Iligan v.v.)
Maynilad (Manila-Zamboanga-Davao)
Masbate I (Manila-Masbate-Catbalogan-Tacloban)
Zamboanga City (Manila-Puerto Princesa v.v.)
Tacloban City (Manila-Batan-Dumaguit-Dipolog v.v.)
Iligan City (Cebu-Iligan v.v.)
Misamis Occidental (Cebu-Ozamis v.v.)
Mabuhay 6 [unfinished]

CARLOS A. GOTHONG LINES INC.
Our Lady of Akita (Manila-CDO-Butuan v.v. and Manila-Cebu v.v.)
Our Lady of Medjugorje (Manila-Dumaguete-Ozamis-Iligan-Cebu v.v.)
Our Lady of Sacred Heart (Manila-Roxas-Palompon-Isabel-Cebu v.v.)
Our Lady of Lourdes (Manila-Dumaguit-Palompon-Cebu v.v.)
Our Lady of the Rule (CDO-Cebu v.v. and CDO-Jagna v.v.)
Our Lady of Naju (Cebu-Ozamis v.v.)
Our Lady of Fatima (Nasipit-Cebu v.v. and Nasipit-Jagna v.v.)
Our Lady of Mt. Carmel (Iligan-Cebu v.v. and Iligan-Dumaguete v.v.)
Our Lady of Guadalupe [reserve/unreliable; formerly Cebu-Surigao v.v.]
Our Lady of Lipa (Cebu-CDO v.v.)
Dona Cristina (Cebu-Tacloban v.v. and Cebu-Palompon v.v.)
Dona Lili (Cebu-Surigao v.v. and Cebu-Maasin v.v.)
Don Calvino [reserve/unreliable; formerly Cebu-Iligan v.v.]
Our Lady of Akita 2 [unfinished]

ABOITIZ SHIPPING CORP.
SuperFerry 1 (Manila-Iloilo-GSC-Davao v.v. and Manila-Iloilo v.v.)
SuperFerry 2 (Manila-Cebu-CDO v.v.)
SuperFerry 3 (Mnl-Zamboanga-Cotabato v.v. w/ Boracay (summer) and Mnl-Dumaguit-Roxas v.v.)
SuperFerry 5 (Mnl-Cebu-Iligan-Dumaguete-Mnl) and Mnl-Dumaguete-CDO-Cebu-Mnl)
Elcano (was not used; obsolete/unreliable; supposedly not brought by ASC to the merger)
Allowing for database inaccuracies, the following cargo ships were brought to the merger:

CARLOS A. GOTHONG LINES INC.
Our Lady of Peace (112.9m x 18.0m, 17kts, b. 1974)
Our Lady of Hope (99.0m x17.3m, 17kts, b.1979)

ABOITIZ SHIPPING CORP.
Aboitiz Concarrier V (69.0m x 10.9m, b. 1968)
Aboitiz Concarrier XIV (71.0m x 10.9m, 13kts, b. 1965)
Aboitiz Superconcarrier I (115.1m x17.3m, 14kts, b. 1970)
Aboitiz Superconcarrier II (102.0m x 16.3m, 12.5kts, b. 1970)
Aboitiz Superconcarrier III (105.5m x16.3m, 12.5kts, b. 1976)
Aboitiz Megacarrier 1 (139.7m x 19.3m, 14kts, b. 1975)
Aboitiz SuperRORO 100 (108.2m x20.0m, 16kts, b. 1983)

WILLIAM LINES INC.
Wilcon II
Wilcon 4
Wilcon 5
Wilcon VI
Wilcon VII
Wilcon 8
Wilcon 11
ROCON I

Excluding HSCs which were just beginning to arrive in the Philippines, the combined fleet of WG&A was nearly 50 vessels, slightly more than double the fleet of Sulpicio Lines, previously the biggest shipping company in the country.

SHIP TRANSFORMATIONS AFTER THE MERGER
Mabuhay 1 became SuperFerry10
Mabuhay 2 became SuperFerry 7
Mabuhay 3 became SuperFerry 8
Mabuhay 5 became SuperFerry 9
Mabuhay 6 became Our Lady of Good Voyage
Our Lady Akita became SuperFerry 6
Our Lady of Akita 2 became SuperFerry 11 (and later the Our Lady of Banneux)
Masbate I became Our Lady of Manaoag (in 1998)
Misamis Occidental became Our Lady of Montserrat (in 1997)

VESSELS TRANSFERRED TO CEBU FERRIES CORP.
Our Lady of Lipa (later transferred to WG&A)
Our Lady of the Rule
Our Lady of Lourdes
Our Lady of Fatima
Our Lady of Mt. Carmel
Our Lady of Guadalupe
Dona Cristina
Dona Lili
Don Calvino
Misamis Occidental
Our Lady of Good Voyage (later)
Maynilad (later and also renamed Our Lady of Akita 2)
Our Lady of Banneux (later)
Our Lady of Manaoag (later)

Like all mergers and acquisitions (M&A), the terms “synergy”, “rationalization” and “streamlining” was bandied about as if these terms are positive terms in business. But soon these words brought chills to the rank and file because the sum of the 3 words is actually only one — “chopping block”. This is the field of bean counters where shipping passion is simply thrown out of the window.

Immediately, the Aboitiz Jebsens system was adopted. That means relying on bigger, faster ROROs and short in-port hours which equates to high utilization of ships. That called for good ship engines, a field of expertise of the now-renamed WG&A Jebsens. That system, however, also meant the death knell for the cruiser liners as their cargo booms meant long in-port hours and their having no car decks means low capacity for container vans.

The new style was to put all cargo in container vans and all container vans are mounted in trailers. For fast handling, tractor heads from trucks were no longer good enough. Only dedicated, automatic prime movers with the capability to raise the trailers were used. Calls on in-between ports generally were only 2-3 hours and ships don’t stay overnight at the farthest port of call of a voyage.

With so many ROROs sailing high hours per week (with some ships sailing 145.5 hours out of a 168-hour week), WG&A was confident it could sell less-efficient and slower ropax and container ships without affecting capacity and frequency. Soon some of the vessels were already for sale.

VESSELS SOLD SOON AFTER THE MERGER
Tacloban City (cruiser)
Iligan City (cruiser)
Dona Cristina (slow, small RORO)
Don Calvino (slow, small, unreliable RORO)
Dona Lili (slow, small RORO)
Wilcon 6 (old cargo ship)
Aboitiz Concarrier V (old cargo ship)
Aboitiz Megacarrier 1 (big, modern container ship)
Aboitiz SuperRORO 100 (big, modern container ship)
RoCon I (big, modern container ship, the biggest in the country)

VESSELS OFFERED FOR SALE BUT NOT SOLD THEN
Dona Virginia (cruiser liner)
Maynilad (big but slow RORO liner)
Zamboanga City (ROLO liner)
Our Lady of Naju (cruiser)
Masbate I (slow, small RORO)
Our Lady of Montserrat (cruiser)
SuperRORO 300 (former Our Lady of Hope, container ship)

With WG&A Jebsens managing the fleet, the merger upgraded the amenities, cleanliness and passenger service of the ferries. But initially all meals were for sale; vehement protests from patrons thereafter forced WG&A to backtrack. It was also claimed that safety standards improved as the whole fleet is now internationally-certificated. However this was not reflected in lower hull-loss rates. Ironically, it was the lesser Our Ladies (and not the SuperFerries) which proved to be unsinkable.

WG&A and CFC practiced branding. Branding is good in the sense that it promises consistent quality and service. On the other hand branding also utilizes ads and promotions. If that results in better market share then it should be good. Otherwise it only means higher level of costs. And higher costs are a threat to marginal routes and to less-efficient ships.

Initially, even with a fifth of their fleet sold (and with only one additional ship coming, the SF12 and while losing the SF7 to fire), WG&A was able to offer more frequencies because of the higher utilization of ships. But almost no new ports of call were added except for Bacolod. And probably the only significant new routes were the Manila-Cebu-Surigao-Davao (which passes through the eastern seaboard of Mindanao), Manila-Ormoc-Nasipit, Manila-Dumaguete-Cotabato and Manila-Cebu-Zamboanga-General Santos/Davao routes.

It was Cebu Ferries that added more new ports of call and routes (like Cebu to Dumaguit, Roxas City, Bacolod, Dumaguete, Larena, Jagna and Camiguin and Cagayan de Oro to Dumaguete) which in turn put a lot of pressure on the other Cebu shipping companies. CFC ships were faster than the competition and as former liners they simply outclassed the rest in terms of amenities and service.

Sulpicio Lines and Negros Navigation responded by adding ships. Sulpicio Lines basically kept to their old routes (except for the new Manila-Cebu-Davao-Dadiangas route) but Negros Navigation which previously concentrated only in Western Visayas has to venture in a lot of new routes and ports of call because their fleet more than doubled in a span of a few years. But then by sailing to Cebu, Nenaco also opened their former exclusive port of Bacolod to competition and they lost more than they gained.

This period right after the merger, the late 90s, was probably one of the best in Philippine passenger shipping. Competition was fierce, choices were many and there were a lot of newly-fielded ships. There were more shipping companies in the past but the ships of the 90s were far better than the ships of the earlier periods. In major ports there were nearly daily departures from all the liner companies combined.

But they say good times never really last. But I didn’t expect that the decline will be that soon, that fast, that continuous and what will be left is just the rump of the biggest-ever shipping company in the Philippines.

The first hint of trouble that I detected was when I noticed that WG&A was not properly assessing the threat, challenge and development of the intermodal system in Eastern Visayas which was then growing by leaps and bounds.

If Fidel V. Ramos had a deregulation program in shipping he also had a deregulation program in the bus and truck sectors. As deregulated area, bus companies can now ply Eastern Visayas routes with just a temporary operator’s permit. Soon a lot of buses were plying the Samar-Leyte-Biliran routes. Then the dominant short-distance RORO company in the Matnog-Allen route lost the case to protect their missionary status and new players entered that route ensuring that the ROROs needed will always be there. Long-distance trucking also developed with the loosening of the restrictions in the importation of surplus trucks. And with the advent of radial truck tires long-distance trucking became easy.

WG&A’s response was to withdraw from the Samar-Leyte routes except for the adjacent ports of Ormoc, Palompon and Isabel which actually comprises just one route. But soon under pressure from the buses these were lost too including the port of Masbate City which was also part of this route. Soon the islands of Masbate, Samar, Leyte and Biliran were lost to the intermodal trucks and buses.

Eastern Visayas was a signal victory for the intermodal system which was based on long-distance truck/bus plus the short-distance RORO ship. Wins by the challengers tend to have a multiplier effect. They become stronger, bolder and more confident. If the ship can be beaten in one area then nobody can pooh-pooh anymore that they will not be beaten in the next area of confrontation. And the next challenge probably happened before the WG&A has fully internalized their loss and it happened when they were in relative disarray.

A related development at this time was that WG&A’s new routes failed to stick and only the Bacolod route was able to survive. The new CFC routes also failed to pan out and were being abandoned one by one. One contributory factor for CFC’s retreat is fuel cost. The amenities and service of their ships might have been higher as those were former liners but as former liners it is also the reason why their engines are bigger and consume more fuel. Soon WG&A/CFC were selling ships. This was the second set of disposals and it happened at about the turn of the millennium. Also disposed in this period were at least six catamarans including vessels that came from mergers in the High Speed Craft (HSC) sector (the mergers with the Sea Angels of Negros Navigation and Waterjet).

At the same proximate time, it was already the strategy of WG&A to sell old and inefficient cargo ships and just let the ROROs liners carry the container vans. They then went for bigger ROROs later with twin cargo decks, the reason for the purchases of the SuperFerry 15, SuperFerry 16, SuperFerry 17 and SuperFerry 18.

The next challenge did not come from the intermodal. Rather it was the withdrawal of the Gothong family from the merger except for one scion. Soon the Gothong family re-entered the shipping business and re-established Carlos A. Gothong Lines Inc. (but they were not particular successful). Not long after this development the Chiongbian family (of William Lines) also withdrew from the merged company. But they did not re-enter the shipping business. Let it be noted, because it is important, that all the merged shipping companies independently retained their cargo forwarding businesess. For the Chiongbian family it was the Fast Cargo Transport Corp.(FCTC) and Gothong Cargo Forwarding Corp.(GCFC) for the Gothong family.

One can speculate that the sale of 10 vessels in 2000-02 (including those withdrawn from routes and old container ships) might somehow be connected to these withdrawals. When the company also took out a big loan in this period ($18.6 million) it might also have a relation to this state of affairs. Before the end of 2002, Aboitiz had already bought out its former partners. But it will still be later that the company will be renamed Aboitiz Transport System (ATS).

The next challenge came from the intermodal again. In 2003, the Western Nautical Highway opened and buses, trucks and jeeps were able to roll down to Panay island via Mindoro and Batangas. Soon the shipping routes and shipping companies serving Panay were under great pressure. Again, WG&A chose to withdraw (from Dumaguit and Roxas) and just tried to hold on to Iloilo port.

The opening of the Western Nautical Highway and the consequent withdrawal from routes, the withdrawal of the Chiongbian family and the need for new ROROs provoked a massacre of ships in this period as about 15 ships were disposed in the years 2003-06, both from WG&A and CFC, both ROPAX and container ships. It must also be noted that six catamarans were also sold in this period. WG&A was lucky that at this time world metal prices were peaking. If it hastened the disposal of ships I can say it is probable. Let me state that in the late 1990’s when all three families were still in WG&A, the company did not sell to the breakers, in general. In the first half of the first decade of the new millennium WG&A sold heavily to the breakers especially when world metal prices were peaking.

Attracted by the doubling of world metal price in 2007, WG&A then sold their prized ferries Superferry 15, SuperFerry 16, SuperFerry 17 and SuperFerry 18 to foreign liner companies.In the process they earned a windfall. But this is not without cost as they suddenly lacked the ships needed to carry the container vans. As a stopgap measure WG&A chartered 3 container ships, the “Myriad”, “Markella” and “Eponyma”. They then also converted SuperFerry 2, SuperFerry 9 and SuperFerry 12 into twin-cargo-deck ROPAX ships. Later the subsidiary cargo company 2GO was formed and the chartered ships were returned one by one.

At about the same time, in 2007, a very ominous development took place. Aboitiz partnered with MCC Transport of Singapore, the Asia subsidiary of the A.P. Moller – Maersk Group, the biggest container shipping company in the world and formed the MCC Transport Philippines (MCCTP). Since it met nationality rules, it was able to ply local routes and the ships invested by Maersk were given special permits by MARINA.

If the chartered ships of ATS and the ships of 2GO were a step up over local competition, the ships that came from MCC Transport were still another further step ahead in terms of size, speed and efficiency. MCCTP acted as feeder to MCC Transport which now dominates the Asia container routes. Together with the coming of more regional container ships (after APL) with direct foreign routes (like MELL, PIL, RCL and others), this completely undermined one important bread and butter of local container shipping which is the transshipment of foreign container vans. ATS and subsidiary 2GO cargo operations might have been affected by this but as a group Aboitiz is safe because they are also on the side of the winners through MCCTP.

After the sales of the four of the biggest and most modern SuperFerry ships in 2007, the fleet of ATS/CFC no longer grew. New ships have come like SuperFerry 20, SuperFerry 21, Cebu Ferry 1, Cebu Ferry 2 and Cebu Ferry 3. But ships have also been sold, lost or laid-up like SuperFerry 9, Our Lady of Medjugorje, Our Lady of Good Voyage, Our Lady of the Rule, Our Lady of Mount Carmel and SuperFerry 19.

With only six ships sailing, ATS ports of call were already down to half compared to its peak and in half of these ports the frequencies were down to once a week. CFC ports of call were also down to half and its fleet is less than a third of what it had before. CFC changed its website and no longer claimed it was the biggest Visayan shipping company (which is just a reflection of the truth). The Sulpicio Lines fleet was already bigger than the combined ATS and CFC fleets. If cargo ships are counted, Sulpicio’s fleet was almost double the combined ATS, CFC and 2GO fleets.

In 2008, KGLI-NM, the holding company owning Negros Navigation made an offer for Aboitiz Transport System. When the bank financing the take-over bid asked for more collateral the bid collapsed. This take-over bid was news for a long time because of the significance and it dragged. It was here that ATS propagated the canard that shipping is losing to the budget airlines and it obscured the fact that cargo is the lifeblood of shipping. Ironically it is this same year that regional container ships in Philippine ports multiplied. And not once did I notice Aboitiz discussing its shares in MCC Transport Philippines. But at least the Aboitiz group was frank enough to admit that the business of power generation attracts them more and that they are already heavily investing in it and if ATS is sold it will be one of their primary investment areas.

In 2010, with the assistance of the ASEAN-China Fund, Negros Navigation Company was finally able to secure the deal to buy Aboitiz Transport System and its subsidiaries especially Cebu Ferries Corporation, SuperCat and 2GO, the forwarding company. At its end as an Aboitiz company, ATS, CFC and 2GO had only 9 ROPAX ships and 2 cargo ships sailing which is not any bigger in gross tons than the company it merged in WG&A even if the SuperCats are counted. So in effect that means the bigger William Lines and Gothong sank without any replacement.

Aboitiz always says around that it has already gotten out of shipping and the maritime industry. But they completely obscure the fact that they are still in MCC Transport Philippines (MCCTP) and they completely own now the former Aboitiz Jebsens (renamed back when the Gothong and Chiongbian families withdrew from WG&A). The former Abojeb is in crewing and manning and that is one of the five recognized sectors of the Philippine maritime industry as defined by the government. MCCTP is already in expansion after Aboitiz sold Aboitiz Transport System. [Recently, Aboitiz clarified that some of their family members are engaged in MCCTP.]

Now, Negros Navigation Company owns Aboitiz Transport System and NENACO even retained the name and the brands. It will be a matter of time before it will be evident how big a bag they are holding.

The “great” merger of 1996 started out with a bang, lofty words and promises. It exited with just a whimper. But along the way it sank two great liner companies (William Lines and Gothong) and took down with it the liner industry.

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Cagayan de Oro Port And Trans-Asia Shipping Lines

Cagayan de Oro port is the main connection of Mindanao to Cebu through the sea and in the south it is Cebu that is the primary trade and commercial center. Cebu supplies so many goods to Mindanao and it also attracts a lot of students and professionals from northern Mindanao. Besides a lot of people in Mindanao have Cebu origins. Cebu’s pre-eminence goes back a long, long time ago and that was even before the Spaniards came. When Magellan reached Cebu they noticed that there were many ships from Siam! Sugbu was already a great trading center even before Fernando Magallanes and Lapu-lapu were born.

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Cagayan de Oro port

Cagayan de Oro was not always the main port of entry from Cebu to Mindanao. Misamis town (Ozamis City now) reached prominence earlier than it and that was why it was the capital of the unified Misamis province then. And in the boom of copra before the 1929 Wall Street Crash in the US, Medina town and Gingoog were even more prosperous than Cagayan de Misamis, the old name of Cagayan de Oro (by the way there is no gold in that city; it was just a name creation to make it more attractive-sounding). Camiguin was also more prosperous then than Cagayan de Misamis (because of copra and not because of lanzones). All these are validated by the biography of former Vice-President Emmanuel Pelaez who hails from the area and whose father was the former Governor of the unified Misamis province.

But things always change and when the interior of Mindanao was opened for exploitation and the Sayre Highway that extended up to Cotabato province was built, slowly the central position of Cagayan de Misamis buoyed it up until it exceeded Misamis, Medina, Gingoog and Camiguin. The Americans’ interest in Bukidnon agribusiness (think pineapple and Del Monte) also helped a great deal and with that even Bugo port in Cagayan de Misamis became a port of importance.

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Part of Sayre Highway leading to Bukidnon

Many shipping companies served the growing commerce between Cebu and Cagayan de Oro. Some of earlier ones were national liner companies (almost all liners then going to Cagayan de Oro call in Cebu first) and some were regionals like Central Shipping (but this graduated to the national liner company Sweet Lines). The situation then was national liner companies dominated the Cebu-Cagayan de Oro corridor (in fact the entire Cebu-northern Mindanao corridor). On the side of the regionals, they were then dependent on wooden motor boats and at best they would have ex-”F” ships or ships converted from minesweepers or PT boats.

In 1974, a new shipping company was born in Cebu which was first known as Solar Shipping Lines but they immediately changed their company name to Trans-Asia Shipping Lines Inc. or TASLI for short. This company had an entirely new tack which made them surpass their regional rivals immediately. Their strategy was to buy good surplus cruisers from Japan whose size even exceeded the former “FS” ships which in those days still dominated the fleet of the national liner companies (but which actually are already reaching the end of their reliable service and were already prone to accidents). The age of those surplus ships of TASLI was about the same of the small liners being purchased then from Japan by the national liner companies. So imagine TASLI’s edge in the regional and specifically the Cebu-northern Mindanao shipping wars especially the premier route to Cagayan de Oro.

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Asia Philippines by TASLI

The cruisers of Trans-Asia Shipping Lines were of course faster, more reliable and more comfortable as comfort was not the strength of the former “FS” ships then which has cargo origins. And, of course, the ex-”F” ships, etc. were even more inferior along with the wooden motor boats. Even in the 1970’s when our population was much smaller and the trade of goods then smaller too, Trans-Asia Shipping Lines was able to form a fleet of seven of these modern (by Philippine standards) cruisers which were all built in Japan in the late 1950’s and early 1960’s.

These TASLI ships bore the names which later became familiar even to the current generation: Asia Philippines, Asia Japan, Asia Indonesia, Asia China and Trans-Asia (two were sold and replaced by ships that bore the same name). To complete the modernist approach, Trans-Asia Shipping Lines built a modern main office and an airconditioned ticketing office just across Plaza Independencia which stands until now and the company was justifiably proud of those. And I say I have to congratulate its architect and the owners because the building still looks beautiful four decades later. Their buildings were just near where their ships docked then. Actually, I sometimes go there just to feel the ambiance and the history of the place.

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TASLI ticketing office

When the new shipping paradigm came which we know today as the RORO ships, Trans-Asia Shipping Lines immediately went aboard and sold their old cruisers. In this field, among the Visayas-Mindanao regional shipping companies, only Carlos A. Gothong Lines Inc. (CAGLI) was ahead of them. In the 1980′,s after the break-up with Lorenzo Shipping Corporation, CAGLI stressed regional operations and they were first to realize the superiority of the ROROs even in the overnight ferry field. Roble Shipping Inc. and Cokaliong Shipping Lines Inc. (CSLI) were among the recipients of the cast-off cruisers of TASLI.

In succession from 1987, Trans-Asia Shipping Lines acquired Asia Hongkong, a new Asia Japan, Asia Thailand, Asia Taiwan, Asia Brunei and a new Asia Indonesia, a new Asia Singapore, a new Trans-Asia, a new Asia Philippines and a new Asia China with the last one added in 1995. Trans-Asia Shipping Lines were adding more than a new ship a year in this stretch and this brought them easily to the top of the Visayas-Mindanao regional shipping companies. From Cebu as a hub, their routes spread like the spokes of the wheel with routes to Mindanao, the all the major Visayas islands and even Masbate in the Bicol Region. And they dominated the Cebu-Cagayan de Oro route. They even exceeded there Carlos A. Gothong Lines and Sulpicio Lines.

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The jewels of their fleet were the sister ships Trans-Asia and Asia China. The two were nearly liner in size and speed and they had the appointments and comforts of a liner. In those days, the two were probably the best overnight ships in the whole country and Trans-Asia Shipping Lines was justifiably proud of the two. It was more than a statement that “they have arrived”. They were the best among the regionals, the top in the totem pole of this category.

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But storms at sea can suddenly appear out of nowhere and their fury could be fiercer than one might expect. The “typhoon” that battered Trans-Asia Shipping Lines appeared on January 1, 1996 when the “Great Merger” between Williams Lines Inc., Carlos A. Gothong Lines Inc. and Aboitiz Shipping Company happened which produced the giant shipping company WG&A. With the creation of WG&A, a new, more powerful regional shipping company suddenly appeared, the Cebu Ferries Corporation or CFC. It also had another subsidiary, the High Speed Craft (HSC) company SuperCat.

In Cebu Ferries Corporation, WG&A passed on their old liners and the former regional ships of William Lines and CAGLI. To top it and to challenge the jewels of TASLI which were ruling the prime Visayas-Mindanao route, the Cebu-Cagayan de Oro route, CFC fielded the Our Lady of Lipa and later the Our Lady of Good Voyage, a small William Lines liner which was the former Mabuhay 6. So as not to lose in the one-upmanship, Sulpicio Lines then fielded the even bigger Princess of the Ocean which was really a liner in appointments, speed and size.

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Photo credit: Ray Smith

The Our Lady of Lipa and Princess of the Ocean were both capable of 20 knots and so the races between Cebu and Cagayan de Oro began. The bragging rights comes from which ship will arrive Cagayan de Oro port first. In Cagayan de Oro that matters because maybe half of the passengers will still be travelling long distances to Bukidnon, Davao, Cotabato, Gensan and Lanao (the farthest I heard was still bound for Sarangani islands). If one is able to hitch to a connecting ride before dawn then he will have lunch at home even it is as far as Davao. In won’t be dark already when the passenger reaches Sarangani province unlike before (if one is late and there are no more trips then one sleeps in Gensan).

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And reports of 2:00 or 2:30 am arrivals (or even earlier) began filtering back. From an 8pm departure in Cebu! There was no way the sister ships of Trans-Asia Shipping Lines can match that. In comfort and accommodations they probably can match ships fitted as liners (except in speed and maybe in the restaurant). But Cebu Ferries Corporation also has a more extensive route system and in conjunction with WG&A liners passing through Cebu their frequencies can’t be matched. WG&A liners acting also as Visayas-Mindanao liners were simply untouchable like the SuperFerries emanating from Cebu. Or when they use the likes of Our Lady of Sacred Heart in a Vis-Min route. Maybe TASLI then were asking what sea god they have crossed to deserve such a fate and tribulation!

Trans-Asia Shipping Lines tried to fight back (and show they are not cowered). They acquired three more ships in a short stretch between 1997 and 1998, the Trans-Asia 2, the Asia Malaysia and the Asia South Korea. However, they lost two ships to accidents in 1999 and they sold three more ships early this millennium. There was simply a surplus of bottoms in the Visayas-Mindanao routes so there was overcompetition (contrary to what Myrna S. Austria claims but those knowledgeable of Visayas-Mindanao shipping will easily contradict her). A lot of regional shipping companies failed in this period. The growth of others were stunted and that included Trans-Asia Shipping Lines.

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Soon, even Cebu Ferries Corporation stepped back, gave up routes and sold ships. It was not simply the effects of overcompetition on them. The “Great Merger” unraveled and the Chiongbian and Gothong families pulled out and they had to be paid for their shares and so still-good ships were thrown to the torches of the breakers. Later, reeling from the resurgence of competitors, Cebu Ferries Corporation gave up completely and its remaining ships were brought to Batangas (and becoming “Batangas Ferries”, jokingly).

But Trans-Asia Shipping Lines suffered a lot. For ten years from 1998 they didn’t acquire any ships until when the purchased the Trans-Asia 3 in 2008. From 2010, Trans-Asia Shipping Lines acquired four more ships. But the difference this time were they were purchasing ships discarded by others (that was the pattern of their clients Cokaliong Shipping Lines and Roble Shipping Lines before). It seems they have forgotten the formula which brought them to the top. As I observed, they were not the same company after that bruising battle with Cebu Ferries Corporation. The “Great Merger” was actually a curse to our shipping as it turned out. Not only to TASLI but to the whole shipping industry. Shipping companies that were growing were blighted by them, some were even snuffed out completely.

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While Trans-Asia Shipping Lines still added four more ferries from 2010, they also lost about the same number through disposals and an accident, the sinking of the Asia Malaysia. And then they sold to the breakers their former jewels which might have weak engines already but the interiors were still superb.

Now one of the cast-offs they bought, the Trans-Asia 5 now just sails as a Cargo RORO ship and another has fast-weakening engine, the Trans-Asia 9 (the Captain of her as Our Lady of Good Voyage admitted to PSSS that its engines were weak already). Trans-Asia Shipping Lines severely lacks ships now and their fleet is beginning to get gray. They still try to hold to the premier Cebu-Cagayan de Oro route but challengers are now baying at their door.

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I hope they have a renaissance. And like in the 1970’s, 1980’s and 1990’s that they sail boldly on to a new dawn.