PACIFIC SHIPPING

New Zealand Herald, Volume LXXIII, Issue 22596, 8 December 1936, Page 8

PACIFIC SHIPPING

BRITISH SERVICES TWO NEW LINERS BUILDING RECOMMENDED REPORT BY COMMITTEE [BY TELEGRAPH —PRESS ASSOCIATION"] WELLINGTON, Monday The report of the Imperial Shipping Committee on the possibilities of a British passenger and cargo service between Western Canada Australia and New Zealand was released to-day by the Minister of Marine, the Hon. P. Fraser, and it is being released simultaneously in Great Britain, Canada and Australia.

The proposed service would be operated by two new ships, comparable with the existing Matron liners, capable of operation at 21 knots. The report states that to date the Matson liners had won, not by cutting the rates, but by the superiority of the amenities and speed, and the cost of each ship to win back the passengers would be £1,250,000, with a life of 20 years. The Order ol Reference The report states that the committee was asked to supply a report as follows: (a) As to the traffic possibilities of a British passenger and cargo service between Western Canada and Australia and New Zealand. (b) Whether the service proposed would be appropriate in view of the traffic possibilities and of any other shipping facilities available, and, if not, what kind of service would be appropriate.

(c) As to the probable financial results of such a service, taking into account the financial results of the working of existing British serv ices between (1) San Francisco and Australia and New Zealand and (2) Vancouver and Australia and New Zealand. (d) Whether such service would have any ill-effects on other British shipping interests. The proposed service would be operated by two new ships carrying approximately 350-375 first-class passengers, 2-50 cabin class passengers, 150-175 third class passengers. The ships would be comparable with existing Matson Line vessels and capable of operating at a speed of 21 knots. Matson Line's Position Each ship would sail once a month on a schedule based somewhat on the following:—From Vancouver and Victoria to San Francisco, Honolulu, Suva, Auckland, Sydney and Melbourne, and returning to and via the same ports, excluding San Francisco northbound. The report refers to the financial assistance given the Matson Line by the United States Government, and says the company's strength in spheres other than shipping, in hotels, sugar, oil and real estate, is noted. The company averaged over 2,000,000 dollars in profits in the years 1926-1933, in which period approximately 77 per cent of its net earnings were from these sources other than steamship business. The company has this year invested 500,000 dollars in Pan American Airways, Limited. Existing mail contracts cease by virtue of the 1936 Act on June 30, 1937, after which a new basis of assistance to neutralise higher costs of building and operating American ships is to be fixed. Traffic Possibilities The traffic possibilities between Western Canada and Australia and New Zealand are discussed. Passenger traffic has been (1925-1935) twice as important as cargo in the Canadian Australasian Line receipts and it is mainly on an increase in passengers that expectations for an improvement are based. Inter-port Canadian Australasian traffic yields more passage money than through traffic, but the figures measure the effect of the depression and recovery from 1933, Comparing 1935 with 1931, the Canadian Australasian Line share in the total through-passenger traffic fell from three-fifths to one-fifth, and "there seems no reason to suppose that under present conditions this position will be substantially altered." To maintain four ships of the Matson class "passenger miles" must be increased from the 1935 figure of 120,000,000 to 154,000,000, an increase of 2S per cent.

Calculations here arc based on tho assumption that the Union Line between Wellington and San Francisco will be discontinued, and that the new Awatea will not diminish the AucklandSydney traffic Qf the Canadian Australasian lino. On these assumptions and perhaps moro important, since a 20-year period is in view, "assuming no great setback in world economic conditions," the required increase is concluded to be not unlikely. Oost of the Ships The cost of each ship would be £1,250,000, and it is considered tho ships would bo appropriate to the service. It was stated the average fares on the new ships would no doubt be higher than those obtained at present. The principal conclusions of tho committee are as follows: (1) Any useful answer under the first two heads of the order of reference must in some degree involve the idea of a speculative venture, since a superior service might quite likely call foytb traffic on a scale not at present visible, whereas a more modest endeavour would not, in the opinion of tho committee, materially alter the present position. (2) For a service of the character under consideration, passenger traffic is likely always to bo of greater importance than the carriage of cargo. (3) In regard to the third head, the committee anticipates that with such vessels as are contemplated, and assuming a certain increase in traffic, there need not be a large, if indeed any, loss on operating. (4) In regard to the fourth head, the committee consulted the president of the Chamber of Shipping of the United Kingdom and the chairman of the Liverpool Steam Ship Owners' Association, each of whom had discussed tho matter with a number of, his members, and their general view is that, whatever objections are still strongly held to the maintenance of uneconomic shipping lines, no serious damage to other British shipping interests need be anticipated from a service such as is proposed, provided the conditions they indicated in their evidence before the committee are fulfilled.