MANILA, Philippines - When the government announced last year its intention to phase out ships aged 35 years old and above, concern gripped the local shipping industry which perceived the plan as threat to the industry’s wellbeing.
But for Cebu-based Cokaliong Shipping Lines Inc, which has taken a different view on the issue, the perceived threat further strengthened its resolve to work even more to improve its service and maintain the high standard of maritime safety.
Chester Cokaliong, founder, chief executive officer and chief operating officer of Cokaliong Shipping Lines, said his company has decided not to join the groups which are opposing the implementation of the proposal despite concerns it may negatively affect his company once the plan pushes through.
Transport Secretary Arthur Tugade earlier said the government intends to phase out aging second hand vessels for safety reasons.
“The intention (vessel retirement) is very good,” Cokaliong said.
Executive Order 909, signed and issued by then president Gloria Macapagal-Arroyo in 2010, encourages ship owners to invest in brand new vessels compliant with international standards and suitable for the country’s weather.
More than half or 65 percent of all vessels in the Philippines are second hand bought from Japan, Korea, China and Europe.
“Majority of the shipping lines opposed it…I did not join because I agree with Marina (Maritime Industry Authority),” Cokaliong said.
This, even as he said that nearly half of his company’s fleet would be affected once the government decides to push through with the phaseout.
Established in 1989, Cokaliong Shipping Lines has a fleet of 12 ships composed of 11 roll-on/roll off (Ro-Ro) passenger vessels and one tug boat.
The ships are used to carry passengers and cargo to destinations such as Cebu, Calbayog, Manguino-o, Cagayan de Oro, Dapitan, Dumaguete, Iligan, Iloilo, Jagna, Maasin, Masbate, Nasipit, Ozamis, Palompon, Surigao, and Tagbilaran.
By May, Cokaliong Shipping Lines will be welcoming its 12th roll-on/roll-off vessel. A refurbished ship from Japan, Cokaliong said the acquisition cost of the vessel is close to P200 million.
Cokaliong said the ship, which has yet to be renamed, will be the third ship in the Cokaliong fleet to have a computerized engine monitoring system. The first two state-of-the-art ships are MV Filipinas Cebu and MV Filipinas Jagna.
High standards
Cokaliong said he prefers to acquire ships from Japan as the country is known for high standards.
While most shipping companies in the Philippines utilize vessels which were built in the 1970s, Cokaliong said his preference is to purchase the younger ones or those built in the 1990s.“
All of our vessels are refurbished and properly maintained to ensure safety,’’Cokaliong said, adding that cleanliness and passenger comfort are also on top of their priority list.
Having been in the industry for nearly 28 years without record of any maritime accident, Cokaliong said he is doubling his effort to maintain the company’s good reputation.
“The answer is to be hands-on,” Cokaliong said.
Cokaliong said he boards one of the company’s ships for one hour per day to make sure the company’s high standards are maintained by the crew.
“The crew are always on their toes because we’re very strict. They are also paid well,” he said. Because of the company’s commitment to give excellent and quality service to passengers and shippers, Cokaliong said he understands the government’s intention to retire the country’s aging fleet of second hand ships.
But while he agrees with the government, Cokaliong said now may not be the best time to implement it.
“The local shipping industry is not ready,” he said, noting that up to 80 percent of the industry will be affected once the government pushes through with its plan to retire aging vessels. He said the economy will be affected as this could affect thousands of passengers and bulk of cargo daily.
Cokaliong explained that even if the ship operators wanted to retire their old vessels, it is more difficult now to purchase younger second hand ships due to the scarcity of supply. “Ships from Japan are scarce because everyone is getting from Japan. Other countries are bidding for it. Indonesia, Croatia and Korea are our competitors,” Cokaliong said.
Buying a brand new ship, meanwhile, is not an option available for all ship operators as it entails huge costs.
Cokaliong said acquiring a new ship is three times more expensive than buying a second hand vessel.
Raising fares to make up for the huge investment to buy a new ship is also not an option because of the stiff competition not just within the shipping industry, but also with airlines. Should the government decide to pursue the phaseout, Cokaliong said there would be a reduction in his fleet, but remains optimistic his company will rise above the challenges.