Container Ships Also Sink Our Liners

In the past, before 1980, there was no conflict between the our liners and the container ships. First, container ships did not exist before the late 1970’s. Second, before that time, general cargo ships were not many as it is our liners that were mainly carrying the inter-island cargo that should be transported fast and were not in bulk. That was the reason why even though our production and the number of people were not yet as high like today, there were so many liners existing with as high as 90 liners at its very peak.

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Gorio Belen research in the National Library

In the early 1970’s, the Sea Transport Company came into existence. What was notable for this new company is they offered regular express cargo service to Mindanao which means a direct service and aside from loose cargo, their ships were able to carry small container vans which were non-standard as in they were offering 8-foot containers which they themselves designed (it was rectangular in shape). In due time, they also shifted to standard container vans and they fielded pure container carriers.

In 1976, Aboitiz Shipping Corporation converted one of their general cargo ships, the P. Aboitiz into a container carrier. Conversion like this was not difficult because only some internal structures need to be modified so a container van can be slot in and that also means modifying the holds and the hatches. The grabs of the booms also have to be modified by a bit so it can handle a container van.

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Gorio Belen research in the National Library

In 1978, containerization was already in full swing when Aboitiz Shipping Corporation added more container ships and William Lines Incorporated followed suit. The next year, in 1979, Sulpicio Lines Incorporated also joined the bandwagon to be followed in the next year by Lorenzo Shipping Corporation which had already split from its merger with Carlos A. Gothong Lines Inc (CAGLI). Negros Navigation Company also joined this new paradigm in 1980. In 1981, Sweet Lines Incorporated also followed suit but they used their old company name Central Shipping Corporation. Among the major liner companies then, it was only Compania Maritima which did not join this new paradigm.

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Gorio Belen research in the National Library

These new container services offered direct sailings as in there were no intermediate ports. With direct service, the container ships might be a little slower than the liners (except for the fast cruisers) but their transit times were not worse than the liners (except to Cebu) because they don’t lose time in an intermediate port or ports. With the speed, convenience, security (no pilferage), lack of damage and contamination, soon the shippers were already shifting en masse to the new container services.

In the liner crisis of 1980 when many liners were deactivated and laid up, it seems the main cause of that was the emergence and immediate success of the container ships and container shipping. Maybe the liners suddenly found they don’t have enough cargo and hence they can’t maintain the old sailing schedule and from the outside it looked like that suddenly there was a “surplus” of bottoms (actually the liners complained of that).

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Gorio Belen research in the National Library

In December 1979, the first RORO liner, the Dona Virginia of William Lines came. This RORO and those that came after her were capable of carrying container vans especially the XEU or 10-foot container vans that can be loaded aboard by the big forklifts. Soon even the fast cruiser liners were also carrying container vans atop their cargo holds especially at the bow of the ship. Some can also carry container vans on a platform in the stern.

Locally, I did not see a new paradigm take hold as fast as container shipping. The ROROs even took longer to be the new paradigm. In containerization, there was even a rush to convert general cargo ships into container ships. All the “new” container ship of Lorenzo Shipping Corporation were converts at the start. The other container shipping companies bought general cargo ships from Japan and converted them into container carriers. Our first container ships looked like general cargo ship unlike the modern container ship which does not look like general cargo ships (and nor can they handle loose cargo).

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In just a little over a year William Lines had 5 container ships (Gorio Belen research in the National Library)

The emergence of the RORO liners even pushed containerization faster as that new kind of ferry is ready-made not only for vehicles or rolling cargo but also for container vans, wheeled in atop chassis (which means atop trailers) or not (if not wheeled then big forklifts “wheeled” them in). There were not yet reach stackers in the early years of our containerization to handle the container vans.

In the 1980’s and the 1990’s, the liners can still hold off the container ships. The reason was there were no budget airlines yet (Philippine Airlines fares then were really stiff) and there were no intermodal buses yet in the bulk of the islands (it was only strong in Eastern Visayas, their pioneer area). And liners can still pack in the passengers (even up to “overloading” or overbooking point) because people has already learned how to travel and there was a great push for migration to Metro Manila (which later led to the overcrowding of this metropolis).

However, when budget airlines and the intermodal buses came in droves, the passengers of the liners dropped. The 2,000 to 3,000 passenger capacity slowly became “too big” and hence the national shipping companies no longer fielded liners with capacities such as this in the new millennium. Aboitiz Transport System (ATS) also tried to reduce passenger capacity and increase cargo capacity by converting some of their liners to have two decks for rolling cargo like what they did in SuperFerry 12, SuperFerry 9 and SuperFerry 2.

Superferry 12

Photo by Edison Sy

Can the liners compete with container ships when the passenger demand dipped? The answer is a plain “No way”. Liners usually have more than three times the horsepower of a local container ship (and it is single-engined which means less spare parts are needed) and yet the local container ship usually have three times the container capacity of a RORO liner. This even became more pronounced when the regime of high oil prices came in the first decade of this millennium. Per fuel prices alone, the container ships can carry each container van much cheaper than what a liner can.

Container vans also do not need the amenities needed by the passengers. Moreover, it does not need the service expected of the passengers which need to be fed and be given more than decent accommodations plus some entertainment. Because of that, the crewing needs of a liner is far higher than that of a container ship. All of those means more expense of the part of the liner company. Besides, a RORO liner is more expensive than a container ship for the same size and its insurance is higher.

Ever since the 1980’s, even when the passenger demand was still great, the national shipping companies were earning more from cargo than their passengers. That is true even today when 2GO admits that almost 70% of their revenues are from cargo (and to think under their roof is SuperCat which widens the passenger revenues). Definitely their investment for liners is greater than their cargo ships. Maybe it was only loyalty to their passengers and passenger shipping why they were not quitting this segment. Maybe it is also because of inertia which means just keeping doing the old things.

Lorcon Dumaguete assisted by tugs

If we look at the recent years we can see that for every liner acquired at least 7 container ships were acquired and this is even a conservative estimate. If we look at the last 10 years starting from 2006, only 11 liners came to our shores and that includes the 3 Cebu Ferries, two of which are still used as overnight ships although already converted into small liners. Meanwhile, MARINA registered 80 or more newly-arrived container ships in the same period. These are the container ships of Oceanic Container Lines, Sulpicio Lines/Philippine Span Asia Carrier Corporation, Lorenzo Shipping Corporation, NMC Container Lines, Solid Shipping Lines, Negros Navigation/Caprotec Corporation/2GO, MCC Transport Philippines (MCCTP), Moreta Shipping Lines, Meridian Cargo Forwarders, Seaview Cargo Shipping Corporation, Escano Lines/Loadstar Shipping Company and West Ocean Lines and Transport acquired in the last ten years. Now how many container lines is that compared to a sole passenger liner company?

There are few liners sailing now and all are under just one company which is 2GO (since Romblon Shipping Lines has already quit). Meanwhile, container ships are still mushrooming and more container shipping companies are joining the field. Even 20 years ago there were already more container ships than liners. Now the container ships are already outstripping the liners in number. And the trend holds true year after year.

The question is why? Well, the simple answer is the shipping companies won’t invest in liners as it does not make sense. More revenues can be earned from container shipping at less investment with less hassles from regulations and supply needs (like the food needed by the passengers). So why would they enter passenger liner shipping? Better “pets” like containers vans rather than people like the passengers who can raise a ruckus and if the ship sinks then goodbye to all the advertising and service spent for the goodwill. If a cargo ship sinks, the uneducated public and the media almost won’t mind at all.

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A Cargo RORO LCT by Asian Shipping Corporation

If cargo is the bread and butter of shipping it will now go to the container lines because they can actually offer the lower shipping rates. If not it will go to the intermodal trucks which has even lower rates. And arriving now recently are the Cargo RORO LCTs which carry container vans (even from Manila) like those of Roble Shipping Incorporated, Ocean Transport and Asian Shipping Corporation. This new paradigm can offer even lower rates than the container ships.

Sometimes it looks like liners are already passe. But I don’t want them to go because I prefer them over planes and the intermodal buses are sometimes too tiring especially those who are no longer young.

Will the liners survive? Now, that is one question I would not like to answer.

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In The Middle of the 1960’s We Needed New Liners and Europe Filled That Need And Not Japan

With the exception of De la Rama Steamship Company, the Philippine liner shipping companies that were born or resurrected after World War II were dependent on the former “FS” (for Freight and Supply) ships from the US Navy. That type of ship was the backbone of our postwar passenger fleet; it was also the most numerous. One reason for that was so many of that type was built during World War II and most were deployed in the Pacific Ocean campaign of the US. Having to pay for the Philippine prewar ships they requisitioned for the war effort that type became the most common replacement given by the US together with the former “F” ships. Aside from direct replacement, the US also had to dispose so many of them and instead of bringing them back to the US where they have no use of them, many were just given to the Philippine government as aid and reparations. The Philippine government then put them up for sale at near-bargain prices (about $60,000 only; where can you get a ship that cheap?). Of course, as always, political considerations mattered and so those who have political connections had the inside track in the purchase of these vessels.

Many of the Philippine liner shipping companies were so enamored with these former “FS” ships that they practically purchased no other vessel type for the next twenty years after the war. Among those were William Lines Incorporated, Southern Lines Incorporated (they also had former “F” ships too) and General Shipping Corporation. In other liner shipping companies’ fleets like that of Philippine Steamship Navigation Company/Everett Steamship, Hijos de F. Escano Incorporated and Manila Steamship Company, the former “FS” ships were in clear majority. Even in the venerable Compania Maritima’s fleet half of those were former “FS” ships. Meanwhile, half of fleet of Madrigal Shipping Company was composed of former “Y” ships which were related to the former “FS” ships. These were former tankers converted into passenger-cargo ships. There was no Negros Navigation Company route then yet to Manila. What had a route then to Manila was the small Ledesma Shipping Lines. Negros Navigation Company became a liner company when they and Ledesma Shipping Lines merged.

Being “enamored” with former “FS” ships also had a reason. They were cheap and while they may be basic sea transportation, the passengers were willing to put up with its deficiencies. And for whatever deficiency, sometimes good food is enough to make passengers overlook it. And so whenever a former “FS” ship becomes available in the market the liner shipping companies readily snapped it up. That goes true even for the fleet of the shipping companies that quit the shipping business like Manila Steamship in 1956 (along with some much smaller shipping companies).

The future great Carlos A. Go Thong & Company was not among the recipients of ships from the US as reparation. Their first ships were salvaged “F” ships that they bought. They only had their first ex-”FS” ships when they bought out the Pan-Oriental Shipping Company of the Quisumbings of Mandaue which then went into motorcycle assembly (the Norkis-Yamaha concern). Like Go Thong, the style of the other smaller passenger liner shipping company was to lengthen the hull of the former “F” ships so these will be “FS” ships equivalent. That was the origin of the first flagship of Go Thong, the Dona Conchita. However, some other small liner shipping companies which did not have enough capital or were just sailing minor routes simply sailed straight their small ex-”F” ships. Some other were also using converted minesweepers and PT boats. Many of the shipping companies in regional routes were using converted “F” ships and converted minesweepers.

These former “FS” ships like the other war surplus ships from the US like the “C1-M-AV1” ships were classified as “passenger-cargo” ships. Obviously, they carry passengers and cargo but it actually has a deeper meaning. In those days, passenger liner shipping companies don’t normally operate pure cargo ships like these recent decades. It is actually these passenger-cargo ships that carry the bulk of cargo in the inter-island route in liner operations (which means there is a fixed route and schedule). The passenger capacities of the ships then were small (there were no 1,000-passenger capacity liners then yet and tops then was just about 700 passenger capacity and normal was just about 300). What was more prized then sometimes were the cargo holds of the ships. Handled by booms (there were no container vans yet) the interport hours were long and departures especially in the interports were not prompt. As long as there is cargo to be loaded, the ships would not leave. Unloading of cargo then in the interport can already take several hours and with so many interport calls the longest-distance ports like Davao takes one week to be reached.

In the mid-1960’s the workhorse fleet from former US Navy ships were already long in the tooth. There were no more of that type to replace the hull losses and our population and trade was growing. Mindanao too has already experienced great migration from the Visayas and so migrants had to travel and goods had to be exchanged. Obviously there was a need to refleet or add to the fleet. The only company that was still able to acquire former “FS” ships from the US in the 1960’s was the newly-established Philippine President Lines, a shipping company well-backed from the highest circles of government. Most of what they were able to acquire were former “AKL” ships of the US Navy. These were former “FS” ships retained by the US Navy after the war and refurbished for use in supplying the many scattered islands and bases of the US in the wide Pacific Ocean. These ships were among the last of its type released by the US.

Some liner shipping companies which had easy starts because of political connections, specifically, Southern Lines Incorporated and General Shipping Corporation shirked from the challenge and quit shipping and simply sold their ships. Southern Lines’ ships went to various liner shipping companies while that of General Shipping Company was divided between Aboitiz Shipping Corporation and Sweet Lines Incorporated. Amazingly, this gave birth to two separate events and entities. Once again, Aboitiz Shipping Corporation had a fleet of its own (before they were just a partner in the Philippine Steamship and Navigation together with Everett Steamship of the US; before the war they were partners with Hijos de F. Escano in La Naviera Filipina). The second event and entity was the regional shipping company Sweet Lines Incorporated became a long-distance liner company. General Shipping Corporation, meanwhile, followed another bandwagon and moved into foreign routes using ships chartered from the National Development Corporation of the Philippine government. It was not difficult for them because they were well-connected politically.

Since no surplus ships were still available from the US then a new source had to be found. Japan by this time was still building their merchant fleet because these were the years of Japan’s “economic miracle” of galloping growth and so no surplus ships were still available from them at that time. The only logical place to look at would then be Europe as the US as a nearly solid continental country has many locomotives and rail wagons but not passenger liner ships. Before this time Compania Maritima has already shown the way in sourcing surplus passenger-cargo ships from Europe. It was easy for them since they have Spanish origins and connections.

I will start from the companies that made moves in acquiring passenger cargo-ships from Europe starting from the one which made a big move. It was the shipping company Carlos A. Go Thong & Co. that was not a recipient of US reparations which took a big gamble in acquiring passenger-cargo ships from Europe. I don’t know but maybe there should not be a great deal of surprise there as they did not get any favors from the US or the government before which means they will have to pull their own bootstraps up themselves if they want to move up. And over a period of six years until 1969 they acquired a total of 9 European passenger-cargo ships for local waters (the Gothong, Dona Pamela, the Dona Gloria, Tayabas Bay, the Dona Rita, the Dona Helene, the Don Lorenzo, the Don Camilo and the first Don Sulpicio. Aside from the nine, Go Thong was able to acquire the big ships Subic Bay, Manila Bay and Sarangani Bay. The first two were C1-A ships of US built but acquired from Europe while the last was a former ship of De la Rama Steamship. Also acquired in the same period was Dona Anita, the former Governor B. Lopez of Southern Lines which has airconditioning and the Dona Hortencia, a former Northern Lines ship of Japanese origins.

Three of these ex-European ships were former refrigerated cargo ships and that means a lot because with refrigeration facilities then Go Thong can then build First Class sections, lounges and restaurants that have airconditioning. So cold drinks will be available anytime too (when the bulk of Filipino homes don’t have refrigerators yet) along with the capacity to carry loads that should remain frozen or chilled. These things were simply not possible with the ex-”FS” ships and besides these former ships from Europe were bigger, a little faster and they have big cargo holds which means more capacity for generating profitable runs. With 14 ship acquisitions Go Thong was already more than Compania Maritima in the inter-island routes before they broke up in 1972 even though they are using their big ships to Europe and the Far East.

For a major, William Lines Inc. had a rather tepid response. They only acquired two surplus ships from Europe (the sister ships Virginia and Zamboanga City, the first) in the mid-1960’s but they bought two former “FS” ships (the Dona Maria and Don Jose) let go by the other liner shipping companies (yes, they have a definite liking for that). The new liner company Sweet Lines Inc. acquired only one surplus passenger-cargo ships from Europe in this period (the Sweet Bliss) and that is understandable as they were just a new liner company. However, they also bought two passenger-cargo ships discarded by the other liner companies (these were not former “FS” ships).

Meanwhile, Aboitiz Shipping Corporation, at the same time did not purchase any passenger-cargo ship from Europe. But in Philippine Steamship Navigation Company (PSNC) they had three passenger-cargo ships which has airconditioning and refrigeration which only arrived in 1955 (The Legaspi, Elcano and Cagayan de Oro). In effect, for them this is their equivalent of the passenger-cargo ships from Europe. The Philippine President Lines and its successor company for local routes Philippine Pioneer Lines purchased only one passenger cargo ship from Europe (the Aguinaldo) as they were already concentrating on their international routes (and that ship was soon passed to their foreign operations). In fact, they soon transferred their local operations to their subsidiary Philippine Pioneer Lines.

Special note should be given to two liner shipping companies that took a different tack and the higher road — those that purchased brand-new liners instead of surplus. One of them was Hijos de F. Escano (later known as Escano Lines). What they did was to take out loans and they ordered three brand-new passenger-cargo liners from West Germany which already had airconditioning. These are the Fatima, Agustina II and Fernando Escano II. Negros Navigation Company, meanwhile, which is establishing itself as a liner company outdid them and took a different supplier. They ordered brand-new liners with airconditioning starting in 1962 which was followed by one each in 1965 and 1967. Those ships were the second Princess of Negros, the Dona Florentina and the beautiful Don Julio, the second. The difference was they ordered their liners from Japan except for the first which was ordered from Hongkong.

Compania Maritima also ordered one brand-new liner with airconditioning from West Germany, the Visayas. Compania Maritima also acquired two big cargo-passenger ships from De la Rama Steamship, the Lingayen Gulf and the Sarangani Bay. They also acquired a local-built liner from General Shipping Corporation that had already airconditioning which they renamed as the Mactan. As a footnote, Sweet Lines Inc. also ordered one brand-new liner from West Germany, the Sweet Grace which for me was rather surprising for a new liner company given that older but more “conservative” liner companies did not go into this direction.

Among those that did not make moves were Madrigal Shipping Company and De la Rama Steamship, two formerly revered names in shipping. Madrigal Shipping Company were then already disposing ships either to the breakers or to other companies. Among the local liner shipping companies, they, together with the already-defunct-then Manila Steamship Company had the penchant for buying really old ships from Europe before and so its expected life is not long. Moreover, Madrigal Shipping Company was by this time already losing in their quixotic routes to Northern Luzon and Northern Bicol and it was just practically using the remaining life of the ferries they have not disposed off. They had only one ship acquired from Europe in this period that they did not immediately dispose of and this was the Viria. Like the rest of their acquisitions this was small because their routes were minor compared to the rest. Hence, this acquisition was not comparable to the European acquisition of the others.

Meanwhile, De la Rama Steamship at the middle of the 1960’s was beginning to function just as international shipping agents. They have already disposed then of almost all their ships including those chartered from the National Development Corporation and they have long disposed of their former “FS” and “F” ships. Two of their big ships went to Compania Maritima in this period.

The smaller passenger liner companies with lesser routes and revenues proved incapable of moving up to the European category of ships, brand-new or surplus. However, four upstart companies tried to join this trend. The new Dacema Lines Incorporated was able to purchase two old passenger-cargo liners from West Germany in 1967, the Athena and the Demeter. The new E. K. Litonjua Steamship Company Incorporated/Eddie Steamships (Philippines), Incorporated was able to do likewise with three old passenger-cargo ships from various countries, the Sultan KL, the Aurelio KL and the Eddie KL. Another upstart, the Northern Lines Incorporated was able to acquire two passenger-cargo ships in this period (along with cargo ships), the Don Salvador and the Don Rene and surprisingly the source of their ships was Japan. Another newcomer, the MD Shipping Corporation was also able to procure a surplus passenger-cargo ship from Norway, the Leon. Except for the Northern Lines ships the ship mentioned did not really last long because they were already old when they can here.

These moves or non-moves determined the fate of the liner shipping companies for the next ten years. With the bold move of Carlos A. Gothong & Co. they moved up fast in the totem pole of the local liner shipping companies that by the start of the 1970’s they were not only barking at the heels of Compania Maritima but has already achieved parity or were even slightly ahead already in the inter-island routes. On the other end of the pole those that did not acquire any or practically had no acquisition were already gone from the inter-island routes in the next ten years and this included Philippine Pioneer Lines and the successor company Galaxy Lines. Madrigal Shipping Company by then had also disposed of almost of their ships and had almost no more ships sailing. The ships of the two companies many of which were ex-”FS” and ex-”Y” ships went to minor liner companies NCL/NORCAMCO Lines (the former North Camarines Lumber) and N&S Lines.

All these moves or non-moves in the middle of the 1960’s determined the fate and the positions of the liner shipping companies from the late 1960’s to the early 1970’s. Go Thong, a relative newcomer in liner shipping moved up a lot in liner shipping tier with their big acquisition. The liner shipping companies that made enough acquisitions in the mid-1960’s chugged along and generally did not lose rank for the next decade, relatively. Among these were Compania Maritima, William Lines Inc., Sweet Lines and Escano Lines. Philippine Steamships and Navigation Co. declined. The ex-”FS” ships were no longer as competitive in the 1970’s and the “C1-M-AV1” ships did not prove resilient and the the Type N3 ships even less durable. Negros Navigation Company was on the way up as they have new ship. The smaller liner companies that were still dependent of ex-”FS” ships (and the related ex-”Y” ships) and the ex-”F” and former minesweepers and were not refleeting were already on the way down. That included Bisayan Land Transport, NORCAMCO, N&S Lines, Rodrigueza Lines and many other small operators.

As recap, twenty years after our inter-island fleet basically relied on war-surplus ships from the US, the first augmentation we had were ferries sourced from Europe as ships from Japan were still rare in the mid-1960’s because they were in the midst of their own economic boom. Up to the end of the 1960’s and early 1970’s we will still source liners from Europe (like the legendary Sweet Faith). It will in the next decade when Japan will be our main supplier of surplus passenger ships.

So from war-surplus ships from the US in the end of the war and up to early 1960’s to European surplus ships in the 1960’s to Japan surplus ships in the 1970’s – these were what marked the early periods of our postwar liner shipping, the period most people now are no longer aware of. This article seeks to fill that void.

[Photo Credit: coasters-remembered.net]