When Eastern Visayas Ports And Shipping Were Still Great

Growing up I heard tales from my late father how great Tacloban port was. He told me about its importance, its physical dimensions, the location, the size of the bodegas outside it and even its relation to Gen. Douglas MacArthur. I had the idea that Tacloban was the greatest port east of Cebu and my father told me that no port in the Bicol Region compares to Tacloban port and not even his beloved Legaspi port (that was the spelling of it then before it became “Legazpi”). He told me Tacloban port will not fade because the Romualdezes were in power in Leyte and everybody knows the relation of that clan to Ferdinand Marcos then (still a President, not yet a dictator). Ironically, my father was later proven wrong not because of politics but because of a paradigm shift in shipping that he was not able to anticipate (when the intermodal trucks and buses sank Eastern Visayas shipping).

So I always wondered what made Tacloban port click then. From my father, when I was still young, I got to learn what is a regional trade center, a regional capital, the importance of the two and it so happened that Tacloban happened to be both. The city by Cancabato Bay was really the dominant market east of Cebu City, bar none. My father always drilled me about cash crops and commodities and how it impacted or shall we say how it shaped shipping. He told me the government can always build ports and send ships to a port by inducement but he said if there is no cargo it won’t last as he stressed cargo makes shipping and not the other way around. Now, how many in government knows that maxim? Definitely not Gloria Macapagal Arroyo who loves “ports to nowhere” a lot!

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Tacloban port. Photo by Gerry Ruiz.

My father was very aware of the shift of the primary cash crop from abaca to copra in the 1950’s and its impact on shipping. In high school, I saw that with my own eyes. Proud, wealthy families in our province which grew rich on abaca handicrafts and trading suddenly became more modest in living. I saw how their bodegas became empty and how the abaca workers suffered. At the same time, I also saw how busy the private port of Legaspi Oil became. Legaspi Oil, an American firm, was then the biggest copra exporter of the country.

Our old man also told me about San Pablo City and how desiccated coconut and coconut oil milling made it one of our earliest cities. He also related me when I was in high school that Laguna was no longer the king of coconut. Leyte was the new lord and I understood by inference how that will boost Tacloban port, its shipping and the city itself.

With PSSS (Philippine Ship Spotters Society) co-founder Gorio Belen’s research in the National Library I had more flesh of what my father was telling me when I was young. Tacloban was a great port of call in the 1960’s and 1970’s and that was visible with the frequency of ships there and the quality of its ships. Definitely it cannot match Cebu or even Iloilo but it was not far behind the latter. And to think the latter had ships calling that were still going to Zamboanga and Southern Mindanao (Cotabato, Dadiangas and Davao). Tacloban also had ships still going south to Surigao, Butuan or even Davao but it was not that many. What Tacloban had were ships calling in Catbalogan or Masbate before steaming further. There were also ships calling in Tacloban first before heading for Cebu.

Entering the ’60’s, Iloilo had 10 ship calls weekly while Tacloban had 7. That was when Cagayan de Oro only had 4 ship calls per week from Manila but Butuan and Surigao both had 6 each. Won’t you wonder with those figures? Well, Cagayan de Oro only became great when it became a gateway to Southern and Central Mindanao with the improvement of the highways. That will also tell one how Tacloban, the gateway to Eastern Samar then, stacked up to other ports. Catbalogan is also not far behind because in the main the ships that called on Tacloban also called on Catbalogan first to maximize passenger and cargo volume.

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Catbalogan port. Photo by Joe Cardenas of PSSS.

In the 1960’s, it was air-conditioning that already defined what is a luxury ship and Tacloban was among the first that had a ship with air-conditioning beginning with the MV Sweet Rose in 1967 (and she served Tacloban for long) and the MV Sweet Grace in 1970. Both were liners of Sweet Lines and they were good ships with good service (I first heard that phrase from my late father, funny). And that was when other great shipping companies still did not have that kind of ship (and that will also tell how great Sweet Lines then). Even the great port of Cebu still had plenty of ex-”FS” ships then which was the basic kind of liner then. And that will give one a view of how important Tacloban port was in those days.

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The MV Gen. Roxas which became the MV Sweet Rose. Philippine Herald photo. Reseach by Gorio Belen in the National Library.

A little of history. Right after the war, two shipping companies fought it out in the main Eastern Visayas ports of Tacloban and Catbalogan. These two were the old shipping company Compania Maritima which was of Spanish origin and the General Shipping Company (GSC) which were formed by former World War II military aides coming from distinguished Filipino families that were part of the comprador bourgeoisie. At one time, GSC had more ships to the two ports with three while Compania Maritima only had two. Another old shipping company, the Escano Lines also fought in the Tacloban route. Unlike the two, the ships of Escano Lines still went on to Surigao and Butuan which were their stronghold.

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MV Leyte. Gorio Belen research in the National Library.

There were some smaller shipping companies too in the route like the Philippine Sea Transport, Veloso Lines, Corominas Richards Navigation and the Royal Lines. Among the single ships that also called in the two ports were the M/S Leyte Lady and M/S Lady of Lourdes. In the mentioned shipping lines, converted “FS” and extended “F” ships were the types calling in the two ports. Among that type that served long in the route (but not continuously) was the MV Leyte of Compania Maritima and I mentioned that because that was notable.

In 1955, Everett Steamship through the Philippine Steamship and Navigation Company (PSNC), a joint venture of Everett and Aboitiz entered Catbalogan and Tacloban with the quixotic route Manila-Catbalogan-Tacloban-Bislig-Davao-Dadiangas-Cebu-Manila. They used two brand-new liners alternatingly, the MV Legazpi and the MV Elcano. Those two were the first brand-new liners used solely in the local routes (to distinguish them from the big De la Rama Steamship liners that soon ended up in ocean-going routes).

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Gorio Belen research in the National Library.

The MV Legazpi and MV Elcano were sister ships and fitted what was soon emerging as the new luxury liner class in the country (but the two were not at par with some of the luxury ships before especially the De la Rama Steamship liners which were lost in the war). If one has the money the route was a good way to tour the country and is a direct way to Southern Mindanao without going first to Cebu (because normally a passenger need to go there first from Eastern Visayas to take a connecting voyage). It was a nice route but sadly it did not last long because from the eastern seaboard route its route was shifted to the route rounding Zamboanga (I guess the reason was there was more business there and the seas were not so rough).

In the early ’60s, the Philippine Pioneer Lines, a subsidiary of the Philippine President Lines (PPL) also tried the Catbalogan plus Tacloban route. When they stopped sailing, their successor shipping company Galaxy Lines continued sailing that route but they did not last long when they folded operations as a company. The two companies used ex-“FS” and ex-“AKL” ships from the US Navy.

When General Shipping Company stopped local operations to go ocean-going in the mid-60s (and that provoked a break within the company), one of the companies which acquired half of their fleet and routes was the upstart Sweet Lines which was trying to follow the path of Go Thong & Company in trying be a national liner operation from a regional operations by acquiring an existing national liner shipping company which is quitting business. The other half of General Shipping fleet went to Aboitiz Shipping Company which then was revived as a shipping company separate from PSNC (and maybe the reason was the coming termination of the so-called “Parity Rights” in 1974). However, it was the PSNC that was used as the entity to re-enter the Tacloban but just using an ex-”FS” ship, the MV Carmen which came from the General Shipping Company and renamed.

At this time, however, the dominant shipping company in the Tacloban and Catbalogan route/s was already Compania Maritima (it was also the biggest shipping company then in the Philippines) after their main rival General Shipping exited the local shipping scene. The company had three ships assigned there, two of which were ex-”FS” ships including the aforementioned MV Leyte.

The year 1967 marked a change in the Tacloban and Catbalogan route. For the second time after the short-lived fielding of the luxury liners of PSNC the route had luxury liners again and two were competing against each other. The notable thing was they both came from General Shipping and both were local-builds by NASSCO (National Shipyards and Steel Corp., the current Herma Shipyard) in Mariveles, Bataan. These were the former second MV General Roxas which became the MV Sweet Rose and the former second General Del Pilar which became the third MV Mactan of Compania Maritima.

However, the two were not fast cruiser liners. This category was already multiplying in the country with the fielding of the 17.5-knot brand-new cruisers of Negros Navigation Company, the MV Dona Florentina in 1965 and the MV Don Julio in 1967. This was preceded by the MV President Quezon of the Philippine President Lines which later became the MV Galaxy of Galaxy Lines which was first fielded in 1962. A note, however, the earlier MV Don Julio of Ledesma Lines which was an overpowered (by putting a submarine engine) ex-”FS” ship can also be classified as a fast cruiser liner and it also served the Leyte route shortly as the MV Pioneer Leyte of Philippine Pioneer Lines.

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The earlier MV Don Julio which became the MV Pioneer Leyte. Gorio Belen research in the National Library.

In this tight market, a small shipping company serving Bicol and Northern Samar also tried a Catbalogan and Tacloban route. This was the Rodrigueza Shipping Corporation which was already feeling the effects of the Philippine National Railways in Bicol regarding the movement of cargo. However, two Chinoy shipping companies that will dominate Philippine shipping in a decade-and-a-half’s time were still not represented in the route. The two were William Lines and Sulpicio Lines (which was not yet existent then). The mother company of Sulpicio Lines which was Carlos A. Gothong & Co. was also not in this route at this time. They will come in two years time, however, with the fielding of the first MV Don Enrique which was a lengthened former “FS” ship. You know they tended to start quietly.

Many ex-”FS” ships or even smaller ships were battling in the Catbalogan and Tacloban routes after 1967. Many will battle for there is cargo and copra was so strong then (exports to the US, Japan and Germany when we had 44% share of the world’s exports) not only in Tacloban but also in a way in Catbalogan which was synonymous with fishing before overfishing caught up with them. In this era, imported rice does not yet go direct to the provincial ports and Eastern Visayas is a rice-deficit region and Cotabato and other parts of the country sends rice to it through trans-shipment. Many other grocery and hardware items also come from Manila to the region as Eastern Visayas was not an industrial region.

In the luxury liner category, however, the MV Sweet Rose of Sweet Lines and the  MV Mactan of Compania Maritima started their battle. This was actually a very even battle because the two were sister ships but the third MV Mactan was faster at 16 knots to the 13.5 knots of the MV Sweet Rose because she was fitted with a bigger engine. Compania Maritima fielded the MV Mactan here because the MV Sweet Rose was overpowering their MV Leyte which was just a lengthened ex-”FS” ship. In a few years, however, the MV Mactan will sink in a storm and MV Leyte will come back in the Eastern Visayas routes.

Leading into the next decade, the 1970’s produced significant changes. Aboitiz Shipping Corporation, the successor to PSNC abandoned their Catbalogan and Tacloban routes and just concentrated in Western and Southern Leyte which was their origin (it had lots of copra too). Morever, the rising William Lines was already present and two successor companies of Go Thong & Company, the Sulpicio Lines and Carlos A. Gothong Lines+Lozenzo Shipping Corporation (two shipping companies with combined operations before their split in 1979) were also plying the Catbalogan and Tacloban routes but they were just using ex-”FS” ships. The old partner of Aboitiz Shipping Corporation before the war, the Escano Lines also left Tacloban but maintained Catbalogan as a port of call as long as their MV Rajah Suliman was still capable of sailing.

In the stead of the lost minor shipping lines of the region like Veloso Lines, some minor shipping companies were also doing the route. Among them were N&S Lines and NORCAMCO Lines which were actually Bicol and Northern Samar shipping companies. The two were looking for routes near their turf because of lost passengers and cargo from the opening up of the Maharlika Highway. Well, although Maharlika Highway was not yet fully paved, the trucks were beginning to roll to Bicol and maybe somehow they have already seen the handwriting on the wall. Rodrigueza Shipping, also a Bicol shipping company stopped sailing the route.

Soon, however, Sulpicio Lines upped the ante and fielded a liner with size, air-conditioning and service that will challenge the MV Sweet Rose and MV Mactan. This was the MV Dona Angelina which was a former refrigerated cargo ship in Europe. That type of ship, when converted here as a passenger-cargo ship will automatically have the availability of refrigeration and air-conditioning. At 13.5 knots design speed, she can match the pace of the MV Sweet Rose but not of the MV Mactan. The MV Dona Angelina was the second ship of Sulpicio Lines in the route.

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Gorio Belen research in the National Library.

In response, Sweet Lines brought in their former flagship into the route, the MV Sweet Grace which was acquired brand-new from West Germany in 1968. She has the speed of 15.5 knots but she was not bigger than MV Dona Angelina or even the MV Dona Vicente (that later became the MV Palawan Princess) which was assigned also to the route. Competition was really heating up in 1974 and I remember this year was the peaking of copra prices just before its great fall.

Things were really heated up because next year Sulpicio Lines brought in their new flagship MV Don Sulpicio on its way to Cebu which means a Manila-Catbalogan-Tacloban-Cebu route. Can you imagine that? If former flagship and current flagship will battle in this route then that means Tacloban and Catbalogan were very important ports then. And to think the later well-regarded MV Dona Vicenta also practically debuted on that route. Well, copra was still then a very important crop. In fact it was our primary cash crop then. By the way, the flagship MV Don Sulpicio was the later infamous MV Dona Paz and she came from Tacloban and Catbalogan on her last voyage.

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Gorio Belen research in the National Library.

In the heat of this competition, it was actually the old dominant Compania Maritima that was wilting. Their MV Mactan foundered in 1973 and there was no good replacement available and so the old ship MV Leyte was left shouldering alone and she was already badly outgunned by the ships of Sulpicio Lines and Sweet Lines. In the 1970’s there was no way a former “FS” ships can match the new liners that came from Europe. They simply were bigger, faster and had more amenities.

When the MV Don Sulpicio was assigned the exclusive Manila-Cebu route to join the two-way battle there of MV Cebu City and MV Sweet Faith, the good MV Dona Vicenta replaced her in the route and teamed up with the MV Dona Angelina. In 1976, however, William Lines fielded a very worthy challenger, the namesake of Tacloban which was the MV Tacloban City and she held the Catbalogan and Tacloban route for a long, long time. At 17.5 knots design speed she can match the best of Sulpicio Lines and Sweet Lines. Aside from speed she can also match in size, accommodation and service.

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Gorio Belen research in the National Library

And so in this year several ships that can be classified as luxury lines were battling in the route. That was an indication how important was that route. As a note, however, the MV Sweet Grace was reassigned by Sweet Lines to other routes especially since their luxury liner MV Sweet Home was no longer reliable. Meanwhile, the shrinking former nationally dominant Compania Maritima no longer fielded a second ship since they were already lacking ships because they no longer acquired a ship since 1970 despite a rash of hull losses.

In 1979, the death knell of Catbalogan and Tacloban ports was sounded clear although few realized it at that time for there was no concept of intermodal shipping before. This was the fielding of MV Cardinal Ferry I of Cardinal Shipping to span the San Juanico Strait and buses and trucks to and from Manila immediately rolled the new highways of Samar and Leyte. By this time copra as the primary cash and export crop of the country was already receding fast in importance because the export market was already shrinking due to the rise of what is called as substitute oils like corn oil, canola oil and sunflower oil.

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Gorio Belen research in the National Library

It was not Catbalogan and Tacloban which were first swamped by paradigm changes but the other ports of Samar like Laoang, Victoria and Calbayog (which I will discuss in another as these ports are more connected to Bicol and Masbate). The fall of Catbalogan and Tacloban ports will happen much later when copra has almost lost its importance. This was also the time that Manila oil mills has already been sidelined too by the rise of new oil mills in the provinces (and the government actually promoted that).

Although sliding now, for a time it looked like Tacloban and Catbalogan ports will hold on to the onslaught of the intermodal. One reason for that was in the crisis decade of the 1980’s it was the Top 2 Sulpicio Lines and William Lines that were still battling there and for sure none of the two will budge an inch. That was the decade when so many shipping companies quit business altogether (and that was most of our liner companies) and actually no shipping company was left unscathed.

In the late 1980’s, Carlos A. Gothong Lines Inc. (CAGLI) made a comeback in national liner shipping but it did not enter Tacloban or Catbalogan. Instead, they called on the Western Leyte ports of Palompon, Isabel and Ormoc before proceeding to Cebu and it was actually a very successful route for them. Also, the Madrigal Steamship came back to passenger shipping with good luxury liner cruisers (which were already obsolescent as it was already the  time of ROROs or Roll-on, Roll-off ships) and it had a Manila-Romblon-Catbalogan-Tacloban route.

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Gorio Belen research in the National Library

However, this was not a long plus to Eastern Visayas liner shipping because in the early ’90s the venerable Sweet Lines and Escano Lines quit passenger shipping and although the latter still had cargo ships their presence were already receding in the region. And then the Madrigal Steamship did just last a few years and quit their passenger shipping also. There were no other entrants in this period to the region except just before the end of the millennium when the MBRS Lines of Romblon, seeking new routes entered the San Isidro port in Northern Samar. However, they also did not last long.

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MV Our Lady of Sacred Heart in Ozamis port. Jorg Behman photo. Credits: John Luzares

When the “Great Merger”which produced the shipping company WG&A happened in 1996, they did not add a new ship and just altered two routes a little. Actually, what happened is they even pulled out a ferry from Carlos A. Gothong Lines and just left one which was mainly the MV Our Lady of Sacred Heart (WG&A is a shipping company which changed route assignment every now and then). However, one of their ships which was passed on to their regional subsidiary Cebu Ferries Corporation (CFC) tried a Manila-Ormoc-Nasipit route using the MV Our Lady of Akita 2 which was the former MV Maynilad. Although successful, she did not last long because she grounded in Canigao Channel and was never repaired.

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Credits to Toshihiko Mikami and funikichemurase

The last two liners to serve Catbalogan and Tacloban were the MV Masbate Uno of William Lines and WG&A and the MV Tacloban Princess of Sulpicio Lines which had identical routes. The MV Cebu Princess also spelled the latter ship when she was down for repairs. When the MV Masbate Uno left as the the MV Our Lady of Manaoag of Cebu Ferries Corporation she was briefly replaced by the MV Our Lady of Naju in the Tacloban route.

Catbalogan and Tacloban finally had no liners left when Sulpicio Lines was suspended from passenger operations in 2008 when their MV Princess of the Stars sank in a typhoon and the MV Tacloban Princess was sold to a local breaker. That suspension also meant the end of the old MV Palawan Princess of Sulpicio Lines serving the ports of Calubian, Maasin and Baybay in the island of Leyte. That also meant the end of the Manila-Masbate-Ormoc-Cebu route of the MV Cebu Princess of Sulpicio Lines. The WG&A also abandoned Tacloban and just tried to hold on to their Palompon/Ormoc route

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Photo by John Cabanillas of PSSS.

In a short time, however, the Aboitiz Transport System (ATS) which was the successor to WG&A also abandoned their Western Leyte routes too. However, for a time ATS came back and served Ormoc with the Manila-Romblon-Ormoc-Cebu route using the MV St. Anthony of Padua but that did not last long.

Now there are no more liners to Eastern Visayas and only oldtimers remember when its ports and shipping were still great. What the millennials know now are the intermodal buses and the so-many trucks in the many ports of Allen, Northern Samar.

Times have changed. The paradigm changed, too.

 

 

 

 

 

 

 

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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.

The Sunset of Tacloban Port

Tacloban City is the regional commercial center of Eastern Visayas and this has been so for about a century now. It has the advantage of a central location and a sheltered port and bay. Its reach weakens, however, in the western coast of Leyte which has its own sea connections to a greater trade and commercial center, the great city of Cebu which has been ascendant in the south of the Philippines since half a millennium ago. 

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http://image.slidesharecdn.com/easternvisayasfinal-150407210918-conversion-gate01/95/eastern-visayas-biliran-2-638.jpg?cb=1428459126

As a regional commercial center, it is but natural for Tacloban to have a great port with trade routes to many places. That has been the situation of Tacloban since before World War II and even before World War I. It also does not hurt that Tacloban is the capital of the province of Leyte. In fact, because of her superior strategic location, Tacloban even exceeded her mother town which is Palo which is still the seat of the church hierarchy.

Before World War II and after that, passenger-cargo ships from Manila will drop by first in Masbate, Catbalogan and Calbayog before hooking route and proceeding to Tacloban. Some of these ships will then still proceed to Surigao and Butuan or even Cagayan de Oro using the eastern seaboard of Leyte. Tacloban then was the fulcrum of these liner routes going to Eastern Visayas. That route was much stronger than the routes that drop by Ormoc and Maasin and perhaps Sogod and Cabalian before going to Surigao. The two routes were actually competing (like Ormoc and Tacloban are competing). If the route via Tacloban was stronger it is because Tacloban was the trade and commercial center of the region.

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At its peak, Tacloban port hosted some seven passenger-cargo ships from Manila per week from different liner companies. She also had daily regular calls from passenger-cargo ships emanating from Cebu. There were also some ships that originate from as far as Davao which dropped by Surigao first. Such was the importance of Tacloban port then which can still be seen in the size of Tacloban port and the bodegas surrounding it.

There were many liner companies that called over the years in Tacloban from Manila. Among them were Sulpicio Lines (and the earlier Carlos A. Gothong & Co.), Compania Maritima, General Shipping Company, Philippine Steam and Navigation Company, Philippine Pioneer Lines (and later the successor Galaxy Lines), Escano Lines, Sweet Lines, even the combined Carlos A. Gothong Lines Inc. and Lorenzo Shipping Corporation. When it was still sailing local routes, even De la Rama Steamship served Tacloban. Among the minor liner companies, Royal Lines Inc., Veloso Brothers Ltd., N&S Lines, Philippine Sea Transport and Oriental Shipping Agency also served Tacloban. Not all of those served at the same time but that line-up of shipping companies will show how great was Tacloban port then.

1979 Dona Angelina

Gorio Belen research in the National Library

For many years there was even a luxury liner rivalry in Tacloban port. This was the battle which featured the Dona Angelina of Sulpicio Lines and the Sweet Rose of Sweet Lines which mainly happened in the 1970s. Sweet Rose was sailing to Tacloban from the late 1960s and was in fact the first luxury liner to that port. The two liners were the best ships then sailing to Tacloban port. The rest, of course, were mainly ex-”FS” ships which was the backbone of the national liner fleet then and there was no shame in that.

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Gorio Belen research in the National Library

Tacloban port was doing well until the late 1970’s when a paradigm change pulled the rug from under their feet. This development was the fielding of a RORO by Cardinal Shipping, the Cardinal Ferry I that connected Sorsogon and Samar. With San Juanico bridge already connecting Samar and Leyte and the Maharlika Highway already completed, intermodal trucks and buses started rolling into Tacloban and Leyte. In fact, in just one year of operation the intermodal link was already a roaring success with many trucks and buses already running to Manila. Soon other ferries were connecting Sorsogon and Samar including the Maharlika I of the government.

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Gorio Belen research in the National Library

With this development the irreversible decline of Tacloban port began. It was a slide that never ever saw a reversal because what happened over the years was the buses and trucks rolling to Tacloban and Leyte just continued to multiply without abatement (and the ROROs in San Bernardino Strait also increased in number). Soon the passengers were already filling the intermodal buses and freight except the heaviest and the bulkiest was also slowly shifted to the trucks. Over the years the number of passenger ships to Tacloban slowly declined as a consequence.

In the late 1980’s, when the pressure of the intermodal was great there were still three national shipping lines with routes to Tacloban – Sulpicio Lines, William Lines and Sweet Lines. In the early 1990’s. when Sweet Lines quit shipping only the top two shipping lines then where still sailing to Tacloban with the Tacloban Princess of Sulpicio Lines and the Masbate Uno of William Lines. Incidentally, the infamous Dona Paz which burned and sank after a collision with a tanker in December 1987 originated from Tacloban.

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Tacloban Princess by John Carlos Cabanillas

When the WG&A merger came in 1996 the company pulled out the Masbate I from the Tacloban route. The last liners ever to sail the Tacloban route were the Tacloban Princess and the Cebu Princess which alternated in the route. Both belonged to Sulpicio Lines. The liner route from Manila to Tacloban was finally severed when Sulpicio Lines got suspended from passenger service as a consequence of the sinking of the Princess of the Stars when both the Tacloban Princess and the Cebu Princess were sold.

The overnight ferry service from Cebu almost followed the same path and died at almost the same time. The last three shipping companies which had a route there were Roly Shipping, Maypalad Shipping and Cebu Ferries Corporation (which was the successor of CAGLI). But passengers slowly learned that the routes via Ormoc and Baybay were faster and cheaper and the connection was oh-so-easy as the bus terminals of the two cities were just outside the port gates of Ormoc and Baybay. The High Speed Crafts (HSCs) to Ormoc, mainly SuperCat and Oceanjet also made great strides and captured a large portion of the passenger market and it further denied passengers for Tacloban. With the HSCs and overnight ships from Cebu that leave Ormoc in the morning there was no longer any need for Tacloban passengers to wait until night.

tacloban_port

http://www.maritime-executive.com/article/Paralyzed-Philippine-Port-Resumes-Operations-2013-11-21

The last rope for Tacloban port passenger-cargo ships was cut when the new coastal highway from Basey, Samar to Guiuan, Eastern Samar was completed. With that the passenger ships connecting Tacloban and Guiuan had to go as the fast and ubiquitous commuter vans (called “V-hire” in the province) suddenly supplanted them. Trucks also began rolling and some of these were even coming from Cebu via the intermodal.

Now only a few cargo ships dock in Tacloban port. There is still one cargo shipping company based in Tacloban, the Lilygene Sea Shipping Transport Corp. Gothong Southern Shipping Lines meanwhile still has a regular container ship to Tacloban but there are complaints that the rates are high (the consequence of no competition). Whatever, there are still cargoes better carried by ships than by trucks. However, some of the container vans for Leyte are just offloaded now in Cebu and transferred through Cargo RORO LCTs going to several western Leyte ports.

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What might remain for a long time maybe in Tacloban port are the big motor bancas for Buad island in Western Samar which hosts the town of Daram and Bagatao island which hosts the town of Zumarraga. I am not sure of the long-term existence of the other motor bancas for the other Samar towns except for maybe Talalora as more and more they have buses that go to Tacloban and maybe soon the commuter vans will follow. Or maybe even the jeep. The lesson is with roads established the sea connection always have to go in the long term.

Tacloban port is improved now. Improving the port eases port operations but it will not make the ships come back contrary to what the PPA (Philippine Ports Authority) and the government say. It is cargo and passengers that make the ships come to a port but if there are other and better transportation modes that are already available then cargo and passenger volumes drop and sometimes it becomes uneconomical for the ship to continue operating.

So I really wonder what is the point in developing a port in the nearby town of Babatngon as an alternative to Tacloban port. Have the Philippine Ports Authority ever asked who wants to use it? It is not surprising however as the PPA is the master of creating “ports to nowhere” (ports with practically no traffic) especially in the time of Gloria Macapagal Arroyo who was so fond of those (for many “reasons”, of course).

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Ormoc Port by John Luzares

In the past two decades the PPA always touted Tacloban port. For maybe they are based there. There was a denial that actually Ormoc port was already the main gateway to Leyte and it is no longer Tacloban port. Recently however, there seems to be an acknowledgment of the real score — that Ormoc port has actually been the de facto gateway already. The government is now developing Ormoc port and it is good that the PPA vessel arrival and departure site already covers it.

Whatever and however they try, it cannot be denied that the sun is already setting in Tacloban port. It is no longer the same port it used to be in the past because of the intermodal assault changed things.

Like they say, things always change.