The story of Manchester Liners from 1898 to the company's diamond jubilee year of 1958 has already been told by Mr R. B. Stoker in articles published in "Sea Breezes" in May 1948 and July 1958. Now Mr Stoker has written an account of the company's subsequent 25 years, packed with some of the most exciting and far reaching developments in world shipping. It is reproduced here from Volume 58 No. 467 Novemnber 1984 & 468 December 1984 and Volume 59 469 January 1985 & 470 February 1985 of "Sea Breezes" with their kind permission.
By Robert Burdon Stoker
This final instalment of the Manchester Liners story brings the situation up to date, with particular reference to the activities of the Eurocanadian Cast company.
THE road haulage subsidiary companies were also fighting the problems of the national recession, with its consequent drop in business and squeezing of rates, together with the fact that Manchester Liners ceased to operate through Liverpool and Greenock.
The road haulage services of the Wardell Services Group at Stretton, Warrington, were particularly badly hit, making it necessary to close these by the end of the year. However plans were in hand there to double the Wardell container repair capacity — and for Commercial Container Transport to open a new transport and container depot at Dagenham, Essex, moving from East India Dock.
Studies had also been taking place in the knowledge of the fact that all Furness Withy (Shipping) major trade routes would be primarily container trades in the near future.
The decision was made to integrate documentation, sales, marketing and transport functions in a Liner Services Division, with Mr. Roberts assuming overall responsibility for the division, based in Manchester.
Key appointments were: Mr. Tim Alcock, executive manager; Mr. John Kilnlick, manager — sales and marketing; Mr. David Brown, container operations co-ordinator.
Said Mr. John Keville, chairman and managing director of Furness Withy (Shipping): "The creations of the division will have far-reaching implications across the company. I believe this is a vital step in our development and one which I know will continue significantly to the company's future."
In April 1982 came the death of C. Y. Tung. Although small in stature, he was one of the biggest men on the world shipping scene. Born in Shanghai, he started his career in coastal shipping. By the age of 24 he was vice-president of the Tientsin Ship Owners' Association.
In 1948 he moved to Hong Kong, starting operations with one 10,000-ton vessel. From these beginnings he developed a fleet which, at the time of his death, numbered some 140 ships totalling about 11 mn. tons.
In later years he had tended to hand over much of the day-to-day control of the C. Y. Tung Group to his eldest son, C. H. Tung, who played a leading part in the 1980 negotiations resulting in Furness Withy becoming part of the Tung Group.
Integration continued of complementary aspects of Manchester Liners, Prince Line, The Pacific Steam Navigation Company, Royal Mail Lines and Houlder Line, all members of Furness Withy (Shipping) Ltd.
These lines, together with associated companies, served over 50 ports in the North, Central and South America, Europe, the Mediterranean and North Africa.
In January 1982 Royal Mail Lines, as partners in the four-company Streamline consortium, had commenced multi-purpose ro-ro services from Liverpool to the Caribbean and East Coast Central America. As loading brokers and UK general agents for the Central America Service (CAS), Royal Mail also served Panama and the West Coast of Central America.
Royal Mail and Houlder provided container and conventional services to East Coast South America and the River Plate.
The Pacific Steam Navigation Company, nearing 150 years of trading to the West Coast of South America, was building up — as the British partner in the nine-line Eurosal consortium — towards the introduction of fully-cellular container vessel services to Colombia (Pacific), Ecuador, Peru and Chile, to commence in 1984.
In 1982 PSNC were operating a container service to Bermuda, plus associated and joint container/break bulk services to these countries as well as acting as UK agents and loading brokers for Linabol and Transnave services.
Prince Line, in addition to container services, provided conventional sailings to North African destinations.
The vast range of services available from these Furness Withy (Shipping) lines, with the strength of a large group plus the individuality, experience and personal attention on which they had been built up, was marketed in various ways, including a large stand at an international freight exhibition held in Manchester.
By the end of the year directors and top executives of PSNC, Royal Mail Lines, Houlder Line and Prince Line moved to the former Manchester Liners House, re-named Furness House, at the Port of Manchester, while still maintaining bases in London and Liverpool.
During June the Mediterranean Division had notched up its 20,000th container to Malta, carried by the Manchester Faith. The cargo: grocery provisions.
In the same month, the container vessel Royal Prince was involved in the rescue of British subjects from war-torn Lebanon, picking them up at Junieh, a small port North of Beirut and taking them to Cyprus. Services to Beirut were temporarily suspended, being resumed as soon as conditions permitted, just over two months later.
On the North Atlantic, Manchester Liners won praise from a Yorkshire company, shipping its 1,500th container to Montreal, practically one a week since ML started fully-cellular container vessel services in 1968.
A youthful-looking Mr Neville Hall, executive manager — North Atlantic, retired in October after 45 years of service, to be succeeded by Mr John Edmonds.
At the year's end another cut-rate operation appeared on the North Atlantic scene, despite a continuing drop in the volume of trade. Breaking away from the Cast Line, a group of management employees set up Sofati Container Lines to trade between the Continent, UK and Canada, using cheap chartered vessels.
Commented Mr Roberts: 'The situation is volatile and the whole complexion can change at short notice. With all lines studying their unsatisfactory figures we have to believe that changes will take place sooner or later.
"Maximum pressure is on to attack all costs. Fortunately, the three members of SLCS are the strongest and most effective companies within the trade".
There was another "retirement' in December 1982 — that of "Manchester Liners News", the company's house journal, first published in March 1961.
David Attenborough, a man who had served ML all his working life, continued to serve in his retirement when he was appointed editor. In the last issue, Volume 22, number 3, he chronicled the journal's highlights as allegiance was transferred to "The Log", the Furness Withy house magazine. Thanks were recorded to Mrs Freda Hunt, "ML News" editorial secretary, and all contributors.
The scene also changed in the United States Mid-West when, from March 1, Manchester Liners appointed Seapac — also a Tung company— as sub-agents in place of Kerr Steamships, a company which had carried out an excellent job for Liners over many years.
The pattern continued of rationalising services by combining operations to meet competition, this lime affecting the Mediterranean. In July Manchester Liners/Prince Line, as members of Furness Withy (Shipping) Ltd., together with Ellerman City Liners and Zim Israel Navigation formed a joint venture named Combined Container Services. The plan: to provide two services, one operating from the North West and Dublin and the other from the South East.
Ellesmere Port was chosen in the North West, Victoria Deep Water Terminal, London, in the South East.
Mr. Chris Skelton, Furness Withy director, Mediterranean Trades, explained: We are sad to be leaving the Manchester terminal docks after such a long and happy relationship. The move is in no way a reflection on their service.
"Ellerman City and Zim already operated from Ellesmere Port, so it was logical that Manchester Liners would be the company to switch terminals."
Mr. David Penny was appointed line manager of the Manchester Prince Line container services and Mr. Tony Lowry as manager of the line's conventional services to North Africa.
On the North Atlantic. the Conference carriers had come firmly to the conclusion that, as Mr. Roberts put it, the ""rot had to stop". It was announced that some rates would be going up from November and others from the beginning of January 1984.
Cast, in fact, announced substantial rate increases effective from November 1, 1983. Also looming on the horizon, to come into effect in 1984, was a change in the management of the St. Lawrence Co-ordinated Service, meaning that it would be operated by two companies instead of three.
In addition, the Dart Containerline service between Europe and the US East Coast, was to be wholly owned by the Tung Group by January 1, 1984, following an agreement reached with Canadian Pacific and Compagnie Maritime Belge. At the time of the announcement October 1983, the Tung Group, CP Ships and CMB had a one-third interest each in the service.
It was stressed that there would be no interruption in the regular weekly service from Southampton (Mayflower Container Terminal) and European ports to New York, Charleston, Norfolk and Baltimore.
On the St. Lawrence route, Manchester Liners, CP Ships and CMB would continue the joint operation between Europe and Montreal, using the same vessels.
CP Ships and CMB would however act jointly with a new company — The Canada Line — working in partnership with Manchester Liners. Dart and Manchester Liners were also to form a new company for the Canadian trade.
Commented Mr. Stoker: "Manchester Liners, in different form, managed to survive one of the most concentrated assaults, backed with seemingly unlimited bank money, to which any company has been exposed.
"The fact that it has done so is due to very great measure to Mr. Roberts, as chairman and chief executive from 1979 who was said to keep the support of his colleagues not only in Furness Withy itself, but in their new owners the C Y Tung Group".
PERILS AND RESCUES AT SEA
THROUGH two World Wars and intervening years of peace the vessels and crews of Manchester Liners have been involved in their share of hazards and deeds of heroism. The 25 years from 1958 to 1983 were no exception.
During the early 1960s the Manchester Progress and Manchester Faith played a vital part in rescuing passengers and crew of a Constellation airliner which had ditched in mid-Atlantic, the former acting as a relay station for the rescue operation while the latter a far smaller vessel, picked up some of the survivors from rafts, 48 out of a total of 76 being saved.
In August 1967 the Manchester Exporter was some 450 miles off Northern Ireland when there was a fire on board, apparently caused by chemicals in the cargo. In the after hold were drums of sodium peroxide and one had apparently spilled some of the contents. The chemical reaction on making contact with organic matter — whether rope, dunnage or skeleton case — was to cause spontaneous combustion. The after hatch was blown off.
Capt. L. Taylor and his crew fought the heat, fumes and smoke from 05.10 hours until 13.50 hours. Some of the crew were in the poop and had to reach the centre castle by means of the tunnel escape. Unfortunately, the exertion was too much for one of the engine staff, Mr. McVeigh, who suffered a heart attack. The Manchester Merchant and Manchester Faith were among the vessels standing by.
In 1969 a fire developed in the cargo of the Manchester Merchant bound from the USA. On board was a full cargo and a number of passengers.
The fire, reported at 02.00 hours in No. 3 hatch, forward of the funnel and aft of the bridge, seemed to be developing in bales of nylon, the cause — although never completely established — possibly being due to friction of steel bands on the nylon bales.
The flames were soon 6ft high accompanied by a very nasty smell. The crew, wearing smoke helmets and breathing apparatus, played hoses on the flames. The fire was very close to oil fuel and preparations were made to abandon ship but, after seven hours, the blaze was extinguished, thanks to the fine efforts of Capt. D. S. Millard, his officers and crew, and the vessel sailed to Halifax.
Capt. H. M. Bunker reported later that the vessel, fighting through short, steep and nasty waters, was "ducking and weaving like a heavyweight boxer" At 23.00 hours the distress call from the Jennifer was received.
Course was altered to the yachts indicated position and, as the sun was setting, radar contact was made at a distance of 7½ miles. The yacht, on passage from Hawaii to San Diego, had been drifting for four days with smashed steering gear.
The husband and wife crew on the yacht, from Arizona, were brought on board the Seatrain Trenton and then the yacht itself was lifted on to the big ship's deck.
Rescue assistance which not only hit the headlines but was also featured on television news bulletins was given in 1982 by the new Manchester Challenge when she went to the aid of the Greek tanker Victory.
The Victory, on her way from Florida to Liverpool with a cargo of molasses, had broken in half in a Force 12 gale when 800 miles off Land's End. The Manchester Challenge en route from Montreal to Felixstowe, received the Victory's distress call at 00.29 GMT on Friday, February 12. Ship's master Capt. John McKay. still on duty because of the weather, said: We were about 95 miles away. Because of the weather we couldn't head straight for the Victory but we reached her by mid-afternoon. It took us 12 hours.
They were reluctant to leave the ship and get into the water. We could understand their thinking. After all, 13 fellows in the bow section had abandoned ship and not been seen in the mountainous seas. They wanted helicopters.
By the time we got the second line aboard it was towards 17.00 hours and getting dark. We knew the Dutch Navy would not get there until daylight and their helicopter couldn't be in action till then.
"But they were right, weren't they? The maxim is to hang on to the biggest, thing afloat and that's just what they did "
After a search for survivors — none being found — the Manchester Challenge went on to Felixstowe. Capt. McKay had been hard at it without sleep for 48 hours. not only directing operations but also, when pressures eased, talking to journalists by radio telephone, explaining what was happening. His account was broadcast on TV networks, synchronised with amazing film shots of the scene taken from an RAF Nimrod aircraft.
Thanks were received from the Greek Government. from the owners of the Victory, from Falmouth rescue headquarters — and the Victory's Greek captain.
Cast and Clouts
THE Eurocanadian Cast company's efforts to take over Manchester Liners and/or Furness Withy, rate-cutting and other activities, caused considerable upheaval and change on the North Atlantic shipping scene during the 1970s and into the 1980s.
Both as a participant until his retirement in 1979 and from the "sidelines", the writer had a special interest. This is his review of the "Cast period" and some of its far-reaching effects:
The Cast company commenced operations at the end of the 1960s by chartering vessels to carry bulk loads to and from the St. Lawrence and Antwerp. One of the great ambitions of every successful charterer is to become a shipowner for at least part of his activities in case there should be a dramatic rise in chartering rates.
Perhaps one year in 10 rates become too high for the charterer to pay and, therefore, he is unable to carry his cargo without a very big loss.
In the mid-70s Cast were extending more and more into the USA which represented 45 per cent of their carryings in 1975. The company was changing from one with cheap, low overheads, carrying one box type to nearby hinterlands, into a more widespread liner operation, with increased overheads and vulnerability.
Cast had stated to the Mergers and Monopolies Commission that "the present range and size of their (Manchester Liners) operations offer little scope for cost reduction and if it (ML) did no more then continue its present operations its cost advantages over its competitors would tend to disappear".
Putting a fine quality captive trade on to larger vessels would have been beneficial to Cast. It was why they had their eye on Manchester Liners.
If this was not possible — and the commission's recommendations meant it was not — there was only one way for Cast to increase carrying and this was by extending their geographical sphere of operations.
What was not brought out in the commission's findings was that although the big ship had an advantage over the smaller ship carrying from A to B, containerisation meant that the ship was only a small part of the operation.
Moving container cargo from, say, Southern Europe, means a smaller return because of the length of time the container is out of operation plus possibly the cost of positioning with an empty leg.
In the same way, if operations are extended into, say, the American Mid-West, the further you go the more imbalance there might be and the more you are on marginal costings. Really, the most important thing is a balance of the trade.
If, for example, container cargo is taken to Minneapolis it will take a long time and probably have to go from one railway to another. Having arrived at Minneapolis, the container will be discharged and, if there is no cargo waiting there, the container will probably have to go back to a depot in Chicago, be examined and cleaned and possibly stay there for a month, dependent on the number of containers there, until needed by a shipper in, say, Kansas City. This means another "dead leg".
The further operations are extended, the more one is becoming dependent on marginal cargo. It is interesting to see how these factors develop.
In selling the Manchester Liners and Furness Withy shares Cast probably received a profit on the two transactions of well over £10 mn. They then really "went to town", with the aid of their enthusiastic bankers, particularly the Royal Bank of Canada, with whom their shareholders had a good connection.
First they bought seven OBO carriers worth 108 mn. dollars from a subsidiary of P & O. Then they ordered two 105,000-tonne deadweight combination carriers from South Korea and contracted in Yugoslavia, no doubt on very desirable terms, for six 70,000-tonne deadweight container/bulk vessels with a capacity of nearly 1,500 boxes, with extensive credits from the Yugoslavs.
Around this time the US Seatrain Lines got into trouble. Early in 1980 they sold their Pacific operation to C.Y. Tung and then achieved the distinction of selling their North Atlantic trade to Trans Freight Lines, part of the TNT group of Australia, and at the same time sold their offices to Cast.
This produced certain legal animosities and did not make for good relations with TFL, who were a non-Conference carrier in the USA and who had reckoned they were going to double their carryings from Seatrain.
There is no doubt that Cast's management thought that Cast would get a considerable slice of this business by taking over the offices.
Manchester Liners, as an American trading line having roots in the Mid-West, took in a limited amount of selected Mid-West cargo but were careful not to exasperate American "tigers" by being too aggressive, taking an unfair share of their cargo. This would, particularly, be the case with another non-Conference line out of the USA — which TFL was.
Cast were considerably increasing their capacity but they were also increasing their overheads: they were getting into more and more marginal business and, at the same time, inviting the American lines to take competitive action to force down the rates — action which was taken in the next year or so, with great success.
In November 1980 the "Financial Times" in an article entitled "On the crest of a wave" pointed out the tremendous growth of three million tonnes. Having got up to around 90,000 containers, the new intended vessels were to double that capacity.
The question, of course, was how they were to be filled. They could only obviously be filled by more and more marginal cargo, which would rather detract from the advantages of lower unit costs.
Not only had Seatrain gone under the but Farrell Lines had gone, so had the small independent Menav — and Cargo Lines, to whom we had also chartered the Manchester Zeal and Manchester Vigour, renamed Cargo Zeal and Cargo Vigour, in 1976.
The question raised by the pundits of the "Financial Times" was whether the Cast group was growing too fast for safety.
Cast increased their activities in the UK and bought a 322-TEU vessel from Spain which they called the Cast Trout to operate between Ipswich and Antwerp, and had plans to increase the capacity calculating they would be able to bring 45,000 TEUs in a year to and from the UK — more than their carryings in earlier days from Antwerp.
All this UK cargo would have to be transported, of course, to Ipswich, loaded, discharged and carried to their berth, which meant that the net return was less than if it had been obtained locally.
By February 1982 the "Financial Times" was reporting, "Mr. Narby hoists the storm cones".
Dart, one of the original lines serving Canada through Halifax on their way to New York, was operating directly into Montreal as partners in the new St. Lawrence Co-ordinated Service. This was a very serious matter for Halifax which owed its entire container operations to Canadian National Railways — CNR.
CNR is a Canadian Crown Corporation and, therefore, subject to political pressures. The Nova Scotia Government felt it was wrong for CNR to be so heavily involved with Cast. These pressures mounted, particularly when Cast, having bought what might be called "tramp" vessels, found that they were running them at a loss.
CNR had an option for increasing their shareholding in Cast but decided they would not do so and in fact started distancing themselves from Cast.
The "Financial Times," on February 18, 1982, reported that Dr. Bandeen, President of CNR, had resigned from Cast — although there was no connection with these premises but it did mean that this connection was lost — and not only that, they got a court injuction to stop Cast transferring assets to Bermuda.
Two days later the "FT" reported that problems had arisen regarding the big container/bulk carriers being built in South Korea costing 60 mn. dollars each but which, because of the slump, were now worth only 30 mn dollars apiece.
However, Cast managed to make arrangements for re-financing but it was quite evident they were having difficulty in meeting their payments on these enormous commitments. A week later "Fairplay" announced that Cast were proposing to sell 50 per cent of the container operation.
The year 1982 was evidently one of financial problems for Cast. On April 24 it was announced in the "FT" that Cast were raising 200 mn. dollars by selling ships and other assets and leasing them back to the Royal Bank of Canada and the Bank of Montreal.
CNR were given an option to acquire 75 per cent of the container business but this option was not exercised. The banks made 40 mn. dollars available for two years, while another bank, the Chemical Bank of the USA, took over three vessels and cancelled 40 mn. dollars.
Cast also announced that it was withdrawing unilaterally from the rate war on the North Atlantic and started to talk to Conference.
By September, 37 of the Cast personnel decided that they would, with the assistance of a Montreal industrial organisation, start up an opposition line, Sofati Container Shipping Ltd. Interestingly enough, this was planned to start with three ships, the size of the original Manchester Liners vessels, to go from Antwerp, and call in at London and Montreal.
Quite obviously, with these smaller vessels they could not afford to go out for the larger marginal costing business all over the Continent and, therefore — in direct competition with Cast as another independent, they were going directly for what might be called the "natural" cargo to and from Casts profitable hinterland. Cast then gave up negotiations with the Conference.
In 1982 exports from Canada to Europe were down by 15.6 per cent and imports down by 10 per cent. Casts five new buildings had an annual capacity of 150,000 TEUs, or 60 per cent of the trade — at a time when there was more capacity available than container cargo to fill them.
The rough seas had become infinitely more rough for Cast. Not only was Sofati hurting, but the new St. Lawrence Co-ordinated Service operated by Manchester Liners, CP .Ships and Dart was hitting back. The American lines, in particular Sea-Land through American ports, and Trans Freight Lines, were quoting intermodal rates into the American hinterland. The Sofati Line claimed to be carrying around 30,000 containers a year.
The Conference too, was meeting all the rates it needed to, so much so that "Fairplay" in March 1983. described them as "being those of the mid-70s and lunacy with 1983 costs."
But the Conference lines were prepared to match rates rather than have their business taken away.
Sofati was claiming to be breaking even on its plain and simple chartering operation while Cast said they were breaking even an operating costs but not making any contribution to interest charges nor capital charges — but these, of course, were desperately needed.
By July 1983 the Banks and the Receiver moved into Cast. The Banks set up Cast (1983) Ltd., to manage the vessels they had financed.
Just at that time, the first of the new super container/bulk vessels, the Cast Caribou and the Cast Polar Bear, were due for re-delivery after dry docking. "Fairplay" reported, on July 14, 1983, that they had been taken over by Yugoslav owners and chartered out to Cast (1983) Ltd.
In the year ended March 31, 1975, with about 39,000 containers, Cast made nearly 18 mn., half coming, of course, from the charter market. In 1982, with about 100,000 containers, it "made a positive cash flow."
"Fairway" announced in January 1983 that in the 12 months to March 31, 1982, there was a loss of 35 mn. dollars and, overall, a loss of 52 mn. dollars — and this was likely to be worse in 1983.
By the end of June "Fairplay" was reporting that the Royal Bank of Canada was exposed to the tune of 275 mn. dollars. This made the £60 mn. owed by the Reksten Group, who had a very substantial record of good earnings to Hembree, look peanuts.
TODAY just three vessels bear the "Manchester" prefix to carry on the tradition of "Liners." They are the Manchester Challenge (ex-Dart America) (30.817 gross tons) on the North Atlantic and the Manchester Crown (ex-Crown Prince) and the German-flag Manchester Trader (ex-Lamara), the latter chartered for the Mediterranean service from Ellesmere Port.
No Manchester Liners reach the terminal docks at Manchester, and the upper-section of the once-busy Ship Canal above Runcorn faces the possibility of closure.