History of the Merchant Navy
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In 1886 the Oroya (2) and the Orizaba were built for the Australia service and introduced an inbound call at Brindisi in Italy. Here the mail was landed and transshipped overland by rail to London knocking six days off the normal Bay of Biscay service. At the same time ships operating the South America routes off loaded the mails by tender at Milford Haven enabling London bound letters and parcels to be delivered a day early. The South America services also carried bullion and, consequently, the company had its own bullion trucks on the Great Western and London Midland Railways. Because of the war in South America the coastal services there were badly affected, the trans-Atlantic passengers services were down so the Australia service was the company’s life blood. In 1889 the Orotava and the Oruba (1) were commissioned for the Australian service and, in the same year, the Chimborazo undertook PSNC’s first cruise to the Northern Capitals.
By 1893 the pattern of trade between South America and the UK had changed. As the communities in South America became more prosperous their buying power increased with a corresponding growth in export trade out of Liverpool. Cargoes carried to the UK also increased substantially and to cater for the growth PSNC ordered their first cargo vessels to supplement the passenger fleet which was not showing any significant increases in numbers. PSNC were not alone in experiencing the changing pattern of trade. World trade was expanding and the carriage of cargo was increasing at a tremendous rate. Up until around 1890 the carriage of passengers was considered to be more important than the carriage of freight but after that date the importance switched to cargo on every worldwide route expect, possibly, that between Europe and New York. PSNC’s first cargo ship to enter service was the Magellan (2)

William Just, who had been Managing Director from 1843 until 1875 died in 1895 at the age of 83 and was still serving as a director at the time of his death. By 1898 economic depression had hit Australia and the Orient Line suffered as a result. This led to closer cooperation with PSNC. The company’s name was changed to Orient Pacific Line and PSNC allocated its premier steamships to the operation. In 1899 the 7949grt Ortona, the largest ship built for PSNC at the time, joined the fleet.

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As there was still no alternative means of transport along the 4000 miles of coastline from Valparaiso to Callao travel between the two ports on a luxurious PSNC coastal passenger ship was a necessity. The weekly service continued to be operated by substantial ocean going ships but their profile differed from the conventional transoceanic passenger ships. The main deck was mainly open for both deck passengers and cattle while the upper deck had staterooms for overnight and week long journeys.
During the Boer War between 1899 and 1903 the Orcana was deployed as a hospital ship and the Orissa, the Orotava, the Ortona and the Victoria were requisitioned as troopships. In 1900 the Potosi (2) was delivered and immediately sold to the Russians for use during the Russo-Japanese war. The small coastal steamer Taboga was seized by the Colombian Government for use as a warship but released when the Royal Navy intervened.

In 1902 PSNC’s Royal Charter was extended for a further 21 years and the crown on the house flag changed from the Royal Crown to the St Edward’s Crown. Between 1890 and 1904 an number of iron hulled ships were converted into coal storage hulks at the major South American ports as it was considered cheaper to bring ships alongside for coaling and storing rather than to undertake the operation using local lighters. At some ports larger ships did not go alongside a quay but used PSNC’s pier-like jetties or tenders. In the UK the Merseyside ‘naval yard’ was closed down, the stores, maintenance and engineering staff being dispersed, and their berth was moved across the river to the Alexandra Dock in Liverpool.

PSNC sold their interests in the Australian route to Royal Mail Line in 1905 together with their share in the Orient Pacific Line and the Oroya (2), the Oruba (1), the Orotava and the Ortona. With these vessels the Royal Mail incorporated the Orient-Royal Mail Line in February 1906 and gave the ships distinctive buff-yellow funnels. The Orellana and the Orcana became surplus to requirements and were sold to the Hamburg America Line. Investment in new ships continued and during 1906 four new cargo ships were delivered demonstrating the company’s propensity for ordering in bulk. In 1908 the Orcoma (1) was delivered. Referred to as the ‘all-electric’ ship she was the first of the company’s vessels to exceed 10,000grt.

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In May 1909 Royal Mail withdrew from the Australian routes and absorbed the four ex-PSNC ships into their own fleet. However, in the following year PSNC was acquired by Royal Mail and although Thomas Rome remained as Chairman control of the company was transferred to London. PSNC’s black funnel livery was replaced by Royal Mail’s buff-yellow and a reduction in the passenger fleet was effected.
Again, trading patterns were beginning to change in the South Americas. Royal Mail were very strong in the Caribbean and the east coast of South America, an area comprising Brazil and Argentine, which were becoming increasingly richer than Chile. The Panama Canal was under construction which would pose a threat to PSNC’s coastal routes and the trans-isthmus railway was already siphoning off trade to Peru. In 1910 the Argentine – Chile railway was completed opening up a cross continent land route. Consequently, Royal Mail benefited from the onset of PSNC’s less profitable trade and PSNC’s fleet began to decrease.

Royal Mail brought into PSNC some of its operating methods including the means of raising capital for new buildings through the issue of debentures. By this means existing shareholders provided additional capital, receiving interest until the debentures were redeemed out of revenue. The effect was to minimise the number of shareholders and to control the group’s financial policies through a small but powerful Board of Directors. This policy, however, sowed the seeds for later discontent as the directors could raise and use money without having to explain their actions to the ordinary, risk bearing, shareholders.

In 1913 the company’s first Andes was built for PSNC but after the maiden voyage to Valparaiso was transferred to Royal Mails routes. In the same year the company introduced a pension scheme for its staff.

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In 1914 the Orduna (1) was launched and immediately chartered to Cunard for deployment on their Liverpool to New York service. The management of Cunard were obviously pleased with her as several of their ships built in the late 1920’s reflected her design. On the 15th August 1915 the Panama Canal opened with a profound effect on PSNC’s trade. The balance of commercial activity in the western side of the Atlantic changed inasmuch that the industrial North East of the USA was as close to Valparaiso via the canal as was Rio Janeiro. The sensible route to Valparaiso from Liverpool was through the Panama Canal and PSNC’s investment in developing the service via the Straits of Magellan at the tip of South America became obsolete. At the same time the Americans, not being involved in the war in Europe, increased commercial activity at a time when PSNC was unable to compete. The farsightedness of the directors in joining PSNC with Royal Mail in 1910 was the company’s salvation.
After the Panama was opened two ships, the Acajutla and the Salvador, were purchased from the Salvador Railway Company to operate a feeder service to Panama. In the same year the Panama (3) was requisitioned as a hospital ship. During the First World War eight ships were lost and in 1918 the Orca was completed as a cargo carrier, operated by PSNC, but after she returned to her builder for refitting as a passenger ship she emerged in the Royal Mail livery. The Ballena and the Bogota (3), wartime standard ships, joined the fleet in 1919 as war loss replacements together with three smaller vessels the Arana, the Almagro and the Alvarado. In 1920 the former German ship Alda was allocated to PSNC and renamed Magellan (3) but the Panama (3) was retained by the Admiralty as a permanent hospital ship and never returned to company ownership.

Also in 1920 the first post war custom built ship for PSNC, the La Paz, joined the fleet and Thomas Rome retired as Chairman being replaced by Sir Owen Philipps, (later Lord Kylsant). The company opened services between New York – Valparaiso and New York – Cartagena – Callao but with concerted American competition the new routes were not successful.

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In 1921two further post war buildings joined the fleet and plans to gradually dispose of the older ships was instituted. Contributing factors to the company’s plans were the effect on the opening of the Panama canal on the Straits of Magellan route and the fact that Valparaiso had become the terminal port rather than the first port of call. The Corcovado (2) was scrapped and the Orduna (2), the Orbita (1) and the Orpesa (2) were transferred to Royal Mail for their new North Atlantic service.
On 4th January 1922 the ninth extension to the company’s Royal Charter was granted but this time in perpetuity for as long as ‘the company shall think fit’. The only condition imposed was that the company’s name and its Liverpool head office should remain. Later in 1922 the company received a symbolic ‘kick in the teeth’ when Chile passed its ‘Cabotaje’ Law. Cabotage is a term which refers to routes operated totally within a nation’s coastline and which are therefore outside the International regulations. Special advantages are given to local shipowners; advantages which are denied to foreign flagged vessels. PSNC were badly hit by the new law which denied them the services that the company was originally formed to provide. The coastal cargo and passenger services had always been the mainstay of the business especially when competition from European shipowners increased and the opening of the Panama canal dramatically changed the emphasis of trade to Chile and Peru.

PSNC’s South American based coastal passenger services came to an end in 1923 when the Inca (2), the Chile (2), the Peru (3), the Guatemala, the Victoria and the Quillota were all sold. Some of them were sold to local operators and continued to operate the coastal routes for some time. The company, however, continued to provide a service in the area with their passenger liners, having transited the Panama Canal, calling at the ports. In 1924 the Oroya (3) joined the passenger fleet and three ex-Glen Line motorships were acquired being renamed Lagarto, Loreto and Loriga. In the same year the European, South Pacific and Magellan Conference, which had lapsed during WW1, was reintroduced in order to stabilise freight and passenger rates. Between 1925 and 1929 the disposal programme continued with seven ships being sold.

In 1931, although the effect of the depression was beginning to be felt, the company built their largest ship at that time, the Reina del Pacifico. Operating on the Valparaiso route she reduced the passage time by 18 days to 60 and, to support her, the Oropesa (2) was refurbished and had her speed increased to match but, because of the economic situation, spent a lot of time between 1931 – 1934 laid up. The depression hit PSNC hard. Ships were laid up and the Board advocated the disposal of the surplus tonnage.

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While all this was going on Royal Mail themselves were in serious trouble as the shipping empire of Lord Kylsant collapsed. Kylsant himself spent a term in prison for making false statements in a financial prospectus aimed at raising additional capital for the group. Fortunately for PSNC a special Act of Parliament was enacted enabling the company to continue operating under the control of its creditors which included Martins Bank. A number of creditors were appointed to the Board and continued in that capacity until the company was safely out of trouble.
During 1932 and 1933 the fleet slim down continued during which time eight ships were either sold or scrapped. In 1934 the New York services were discontinued and a further three ships were sold for continued service elsewhere. Passenger trade to Cuba was seriously affected as a consequence of the Spanish Civil War in 1936 and in the following year the Falkland Islands Company cancelled its contract with PSNC and began operating its own supply vessels.

In 1938 financial stability had been restored and Royal Mail acquired the shares of PSNC once again. The two companies continued as separate entities but the directors of both served on one Board. By 1939 the fleet had been reduced to fourteen ships and plans were made to replace the older vessels but the Second World War commenced before a single keel was laid. During the entire period of the war PSNC were fortunate in only losing two ships and in 1943 saw the delivery of the first two replacement ships, the Samanco and the Sarmiento (2). Also in 1943 the company acquired a shareholding in British South American Airways but had to relinquish the investment when the British Government formed the British Overseas Airways Corporation.

After the war, in 1946, the Santander and the Salaverry joined the fleet but the feeder ships Acajutla and Salvador were sold when the transit service through the Panama canal ceased. During the post war years the company continued with its programme of replacement and renewal

In 1952 the design of the house flag was amended when the Royal Crown replaced the St. Edwards Crown, reverting back to the original design.

In 1937 the Furness Withy Group had acquired a substantial shareholding in Royal Mail and in 1955 two of their ships, the Albemarle and the Walsingham, were transferred to PSNC management for a two year period operating a Bermuda to Panama service. The Reina del Mar replaced the Reina del Pacifico in 1955 and the fleet then comprised 13 ships.
The fleet expanded in 1959 when three small cargo motor ships joined the fleet to replace the Albemarle and Walsingham, who had returned to Furness Withy, on the Bermuda – Caribbean ports – Panama service. In the same year H. Leslie Bowes was appointed Chairman of PSNC and in 1960 became Chairman of Royal Mail. Also in 1960 the company acquired its first oil tanker which was named after the founder, William Wheelwright. The acquisition was purely an investment and the ship was placed on a long term charter to Shell.

In 1961 a second oil tanker was similarly acquired as an investment. Named after the company’s first captain, George Peacock, she was chartered to British Petroleum on a long term basis. Another trading area was denied to PSNC in 1961 when Fidel Castro became the President of Cuba.

The Board undertook a lengthy appraisal of passenger ship operations during 1963 and concluded that they were no longer a viable proposition. Consequently, the Reina del Mar was chartered to the Travel Savings Association, in which the company had a 25% share, for cruising operations. The company also decided that they longer wished to employ passenger ship staff and the management of the ship was handed over to Union-Castle, a partner in the TSA, who had the necessary skills and infrastructure. Union-Castle eventually purchased the ship in 1973.

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In 1965 Furness Withy, who already held a substantial shareholding in Royal Mail, made an offer to purchase the remaining equity. Accepted in the June of that year Royal Mail and its subsidiary PSNC were integrated into the Furness Withy Group who began an appraisal of the group’s overall tonnage. A policy of inter-group switching was adopted together with the disposal of older, less efficient ships. PSNC, because of the heavy competition to the west coast of South America and unsettled commercial and political conditions in that area, was a prime candidate for this treatment.
During 1967-8 the remaining five “S” Class vessels were disposed of but three Shaw, Saville & Albion motorships came under PSNC management to replace them. Painted in the PSNC livery they were given the traditional names Orita (2), Oropesa (2) and Oroya (4).

John Gawne, an employee of PSNC since 1934, became Chairman in 1970 and further inter-company changes took place. Ships continued to be transferred between companies and ,as technology evolved, new vessels were acquired which could do the work of several of the older types. The new self unloaders, high capacity and faster ships, the Orbita (2), the Orduna (2) and the Ortega (2) joined the fleet in 1973. With some vessels chartered from Furness Withy they maintained a three weekly service from South Huskisson Dock at Liverpool.

By the beginning of 1980 the PSNC fleet was comprised of only five ships, the two years old Oropesa and Oroya together with the seven years old Orbita (2),) the Orduna (2) and the Ortega (2). Lloyds Registered identified the ships as being owned by subsidiary companies of PSNC. In the April Compania Sud Americana de Vapores purchased the Orbita and renamed her Andalien. The Ortega was renamed Andes by PSNC and the two ships operated in tandem each chartering space from the other to maximise cargo efficiency.

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Containerisation was rapidly expanding and eliminating the need for conventional cargo carriers. By 1983 PSNC was only operating three ships, the Oroya (5), the Oropesa (4) and the Andes (2) and in the following year circumstances dictated that the independent name Pacific Steam Navigation Company should finally disappear into Furness Withy Shipping. In 1984 a full container ship, the Andes (3), joined the seven member Europe South America Line (Eurosal) consortium. Feasibility studies had shown that seven faster, larger and specialised ships could replace the twenty eight members ships operating the route.
Later in 1984 Wheelwright House in Liverpool was closed with the management operations being integrated with Furness Withy’s in Manchester. By 1985 the only visible remains of the former PSNC were the Oroya (5) and the Andes (3) who were operating within the Furness Shipping Group with traditional names.

Another great shipping name which figured so prominently in the development and history of the South American continent had finally faded into obscurity – but, hopefully, not forgotten.

At the time when the Pacific Steam Navigation Company ceased to exist in 1985 the British Merchant Navy was reduced to 920 ship of which only 689 were over 500grt. This represented a mere 3% of the world tonnage whereas in 1900 it comprised 48%.

The history of PSNC and its’ ships has been extracted from
Merchant Fleets 8: Pacific Steam Navigation Co. by Duncan Haws
to whom we extend our grateful thanks.
Available from TCL PUBLICATIONS