CHAPTER VIII.
Pacific Steam Navigation Company—First steamer on the Pacific, 1825—Mr. Wheelwright—Obtains a charter, 1840—First vessels, the Chili and Peru—Warm reception at Valparaiso—The Company persevere—Appointment of Mr. Just, 1846—Extension of contract, 1850—Marked improvement in the prospects of the Company, 1860—New lines—Vast increase of capital, 1867—Further increase of capital to 3,000,000l., 1871—Capital increased, to 4,000,000l., 1872—Extent of fleet, Iberia and Liguria—Chimborazo, 1871—Too rapid increase—Loss arising therefrom—Modification of mail contract and reduced services—West coast steamer Bolivia—Future prospects of the Company—Trade with Mexico—First line of steamers from Liverpool to Chagres—West India and Pacific Steam Navigation Company—Liverpool, Brazil, and River Plate Steam Navigation Company.
Pacific Steam Navigation Company.
About the period when the West India Steam Line was in course of formation, another company, destined to surpass it in importance, had obtained from the British Government a charter for establishing “steam navigation along the shores of North and South America in the Pacific Ocean,” as well as between those shores and China, the Australasian Colonies, and certain ports in the West Indies and in the Atlantic Ocean.
To establish a line of steam-ships for the purpose of carrying on efficiently the large and valuable, but hitherto undeveloped, commerce within the area named was indeed a bold undertaking, and one requiring extensive and varied knowledge, with a large amount of experience and judicious management combined with the necessary amount of capital. These various requisites were not, however, readily obtained at a period when ocean steam navigation was comparatively in its infancy, and were rendered still more difficult by the knowledge that the endeavours of the original projectors of steam navigation on the shores of the Pacific had not been attended with success. Indeed, the first of those undertakings proved most unfortunate, and was, also, accompanied by a good deal of romance.
First steamer in the Pacific, 1825.
So early as 1825, when the struggles among the republics of the South Pacific for supremacy were at their height, a few merchants resident in Panama formed themselves into an association for the purpose of trading along those shores, but they had so many difficulties to overcome that a long time elapsed ere they could obtain the required capital. The first steamer on the Pacific coast was a small craft named the Telica, commanded and owned by a Spaniard named Mitrovitch; but his career and that of the vessel under his charge was a short and melancholy one. In a fit of despair at his want of success, with some further annoyance from the complaints by his passengers, caused chiefly by delay, and his inability to find a sufficient supply of fuel, he fired his pistol into a barrel of gunpowder, blowing up his vessel in the harbour of Guayaquil, and destroying himself and all on board except one man. An occurrence of this lamentable nature, though it happened ten or fifteen years previously, would, in most cases, have destroyed, for many years subsequently, any attempts, by means of steamers, to trade between Valparaiso and Panama, had not a gentleman, then resident in Guayaquil and familiar with the trade of the coast, taken up the business with the determination to carry it through at all hazards.
Mr. Wheelwright.
William Wheelwright,[283] an American citizen, and at that time United States’ Consul in Guayaquil, was no common man. He saw the advantages to be derived from developing the rich resources of the eastern shores of the Pacific, and the facilities which steam communication would afford to the more frequent and more rapid intercourse between the then rival republics. Nor was he mistaken in the views he entertained, though he had many difficulties to overcome. Steam, while it eventually became the chief means of settling the petty wars which had so long raged, offered, at the same time, so many new sources of profitable employment, with the opening up so many new channels of trade, as happily to direct the attention of the native inhabitants from the struggles of war to the peaceful pursuits of commerce. Studying the wants of those countries and the most efficient means of affording profitable employment to the people, Mr. Wheelwright spent six of the best years of his life in arranging plans for steam communication between the different republics, and, at last, obtained from the Peruvian, Bolivian, and Chilian Governments the privilege of thus navigating their coasts for the term of ten years. He then made a journey to England for the purpose of endeavouring to influence the wealthy merchants of this country to aid him in the undertaking.
Obtains a charter, 1840.
Here, however, he had still many difficulties to overcome, for the trade he proposed to develop was then comparatively unknown, and the little wars between the republics of the Pacific naturally led English merchants to hesitate, ere they embarked their capital in a company whose prospects were at that time far from encouraging. Nevertheless, he succeeded in his object, and, on the 17th of February, 1840, obtained, under letters patent, a charter for the establishment of the undertaking now known as the Pacific Steam Navigation Company, together with a small subsidy for the conveyance of the mails.
This contract differs from all others, in this respect, that the vessels employed under it do not touch at any port of Her Majesty’s dominions, although, practically, it may be considered as providing a continuation of the line from Southampton. The extension of British influence and British commerce was, doubtless, the chief inducement for supporting this communication between the republics of New Grenada, Bolivia, Peru, and Chili; the nature and extent of that traffic rendering it necessary for the English to maintain mercantile establishments in the chief ports and towns on the western coast of the Pacific, and thus justifying Government in incurring this expense.[284]
The capital of the Pacific Company at first was limited to 250,000l. in 5000 shares of 50l. each. Though the whole capital, after a good deal of labour, was subscribed, only an amount was called up sufficient at the time to enable the directors to provide two boats, the Chili and the Peru, which were dispatched to commence operations towards the close of the year 1840.
First vessels, the Chili and Peru.
Warm reception at Valparaiso.
These vessels were built of wood by Messrs. Charles Young and Co. of Limehouse, London. They were sister ships, each of about 700 tons gross register, though with a capacity of not half of that tonnage, and with engines of about 150 horse-power constructed by Messrs. Miller and Ravenhill. Through the courtesy of the directors, I am enabled to furnish the following illustration of the Peru, whose dimensions were 198 feet extreme length and 50 feet extreme breadth. They were at that time considered fine vessels and certainly they have a comfortable business-like appearance. No wonder, therefore, that, on their arrival at Valparaiso, they were received with great rejoicing and with “salvoes of artillery, everybody wishing to visit them, the President of the Republic, accompanied by his ministers, being among the first to welcome the steam-ships to the shores of the Pacific.”
“PERU.”
The Company persevere.
Appointment of Mr. Just, 1846.
But here again, Mr. Wheelwright had many difficulties to overcome, the scarcity of fuel, as in the case of the Telica, being one of the greatest. Under these circumstances, the Company, during the first five years of its operations, sustained a loss of no less than 72,000l. upon a paid-up capital of 94,000l. In the face, however, of these heavy losses, the shareholders resolved to persevere with their bold undertaking, seeing in it the germs of future success. Under the impression that the business of the Company could be better conducted in Liverpool, where most of the shareholders resided, the directors, on the 4th May, 1846, obtained a supplemental charter to remove from London to that city, where the head office and general management, have since been conducted by Mr. William Just, who, in January of the following year, was appointed its managing director. In December 1847, the directors were enabled to give to the shareholders for the first time a dividend, though only 2½ per cent., on their paid-up capital.
Extension of contract, 1850.
In 1850, the Company obtained an extension of its mail contract of 1845-46, whereby the directors were required to provide not less than six steamers, of at least 170 horse-power each, but, at the suggestion of the Company, the Government, in November of that year, allowed four steamers of 1000 tons and 300 horse-power to be substituted for the six smaller vessels originally contemplated.[285]
The prospects of the undertaking were, however, still far from encouraging, and when, in February 1853, the directors represented to the Board of Admiralty that the expense arising from the greatly increased price of coals rendered the portion of their service between Callao and Panama altogether unremunerative, and asked for an increase of subsidy, they were refused. The directors then solicited permission to employ between these two places vessels of only 100 horse-power and 400 tons, which they considered would be sufficiently large for the passenger traffic, and would restore the balance of profit by reducing the cost of fuel. They also undertook that these vessels should be capable of maintaining an average speed of 10 knots an hour, and that the mail service should not suffer. This proposal Government acquiesced in, temporarily, reserving to itself the right of reverting to the original agreement.
The more frequent and more speedy services had, indeed, become, if not necessary, at least desirable, since the West India Mail Packet Co. had doubled the services of their ships between England and Colon. The Pacific Co. therefore felt that, if they did not run their vessels to and from Panama in connection with the steamers from England, those of the United States of America, now rapidly increasing in the trade of the Pacific, might soon monopolize the lines they occupied from the Isthmus to the southern ports. Consequently, the directors of the Pacific Company were glad to accede to the proposal of the Admiralty to run steamers with the mails monthly from Panama, for the small increase of 5000l. per annum to their original contract of 20,000l.
This Company had now in its service seven vessels of 5719 tons and of 2396 horse-power; but, though they touched at no less than thirteen ports between Panama and Valparaiso inclusive, the average annual amount of receipts for postage, for five years previously to 1860, amounted to only 5441l.
In 1856, Mr. Just visited the west coast, and re-organized the management and the service generally with very successful results. Towards that success his adoption of the compound engine,[286] then almost a novelty, materially tended, effecting as it did, an enormous saving in the consumption of fuel and, consequently, in the current expenses of the Company.
Marked improvement in the prospects of the Company, 1860.
New lines.
From 1860, the trade of the Pacific rapidly developed itself. The inhabitants of the coast now saw the incalculable advantages to be derived from regular and increased intercourse between other countries. Steam here, as it has done everywhere else, opened up new and hitherto unthought of branches of commerce; the natives learned what other nations required, and, to meet these demands, they turned to cultivating their fields instead of fighting among themselves. Consequently, the Pacific Company soon found it necessary to increase the number of their fleet. In December 1859, a second supplemental charter was obtained, which extended the incorporation of the Company for twenty-one years from the 17th of February, 1861. On the 15th of June, 1865, a third supplemental charter was applied for and obtained, extending the powers of the Company, to the establishment of lines of communication “between the west coast of South America and the River Plata, including the Falkland Islands and such other ports or places in North and South America, and other foreign ports, as to the said Company shall seem expedient.”
Vast increase of capital, 1867.
During these years the profits of the undertaking had been steadily increasing, and at a special meeting of shareholders held in December 1867 it was determined to add to the operations of the company by establishing a monthly line from Liverpool to the west coast of South America, viâ the Straits of Magellan.
This entirely new and important, though hazardous, branch of the service necessitated an increase of the capital of the company to 2,000,000l. In furtherance of their views the directors sent their steamer Pacific, of 2000 tons register and 450 horse-power, from Valparaiso, in May 1868, as the pioneer of the new mail line.
Further increase of capital to 3,000,000l., 1871.
The bold undertaking of dispatching steamers on so distant a voyage, and at so high a rate of speed as that maintained, proved for some years more successful than could have been anticipated, and, in 1869, the profits of the four new steamers, which had made nine voyages from Liverpool to Valparaiso, were so satisfactory that the directors in 1870 determined to make the line bi-monthly, and extend the voyage from Valparaiso to Callao. Seventeen voyages made in the course of that year with still greater success, induced the directors to recommend that the departures thenceforward should be three a month; and, in December 1871, the shareholders authorized a further increase of the capital to 3,000,000l., so that the company might be enabled to dispatch every week one of their steamers on this distant voyage.
Considering the then comparatively limited amount of the trade it was a very bold experiment. While directors of undertakings of this nature very properly consider it their duty to meet and even to anticipate the requirements of the public, so as to prevent others occupying their field of operations, and thus avoiding injury from competition, it may well be questioned if this extraordinary increase of steamers could be justified by any reasonable anticipations of the increase of the trade to be developed by these additional facilities, and within so limited a space of time. The result, indeed, soon showed that they were now too far in advance of the requirements of commerce. Though, in 1871, twenty-nine round voyages were performed between Liverpool, Valparaiso, and Callao, the profits, so far from being increased, gave signs of falling off; and, in 1872, thirty-seven round voyages were made with, as the result proved, a further diminished rate of profit, the directors having, in January of that year, recommended at a special meeting of shareholders the addition to their fleet of four more steamers at a cost of 500,000l.
Capital increased to 4,000,000l. 1872.
In the course of the following July, a further charter had been obtained authorizing an additional 1,000,000l. of capital to be raised, and thus, with power to draw on the shareholders to the extent of 4,000,000l., the whole capital of the company, the directors did not hesitate to still further increase their already gigantic fleet!
Extent of fleet.
Iberia and Liguria.
The company now owns no less than fifty-four steamers, of an aggregate of 119,870 tons, and 21,395 horse-power.[287] Two of these, the Iberia and Liguria, built and supplied with engines by Messrs. John Elder and Co., of Glasgow, in 1873, are each 4671 tons gross register with a capacity for 4000 tons of cargo, besides space for 916 tons of coals, and accommodation for no less than 800 third-class passengers. They are each of 700 horse-power nominal, and attained a speed on their trial trips of 15 knots per hour.[288]
Chimborazo, 1871.
Too rapid increase.
But, though inferior in power and dimensions, the vessels the company had built previously to this time for their Liverpool and Valparaiso line were equal in other respects to the new ones. Indeed, as may be seen by the following representation of the Chimborazo, launched in 1871, also from the yard of Elder and Company, they were not surpassed by any steamers afloat. She is a sister ship of the Cuzco, built by the same firm, as also of the Garonne built by Robert Napier and Sons and launched the same year. They are each 370 feet in length between perpendiculars, 41 feet beam, 35 feet depth of hold, and about 3850 tons gross register tonnage. They perform their passages on the coast with remarkable speed and regularity, while the voyage from Liverpool to Valparaiso is usually made in forty-two days. But, for the time being, the company has found itself overtaken by severe competition and depression in the west coast trade, and has been obliged to reduce the services on the line from Liverpool to that coast to two voyages each month instead of one weekly; in consequence of which nine of their steamers are, at present, laid up for want of employment.
“CHIMBORAZO.”
Loss arising therefrom.
Although the loss thus sustained may be attributed in no small degree to the over-sanguine views of the directors in regard to the development of the trade between Great Britain and the west coast of South America, some portion of it is also due to the competition on the coast and to the opposition they met in performing the weekly service for which they had obtained a postal contract from Her Majesty’s Government in December 1872. Bound to a speed in excess of what had been required of other companies, and with a grant of only the sea postage, it was impossible for them to hope to compete successfully with such highly subsidized companies as the Royal Mail and the French Messageries Maritimes, both of which maintain an opposition race to those ports of the Brazils whence the Pacific Steam Navigation Company hoped to derive some advantage by the conveyance of passengers on their way to Valparaiso.
Modification of mail contract and reduced services.
Indeed, where a high rate of speed is required, and where heavy penalties are inflicted for any irregularity in the performance of the stipulated service, it is very questionable, unless when highly subsidized, if any advantage whatever is to be gained by the conveyance of mails on so distant a voyage as that which the Pacific Company had undertaken to perform. But, by reducing the number of services and modifying the rate of speed, which the Government at last consented they should do—requiring, however, a reduction in the amount of subsidy—the directors, on the one hand, may hope to secure a sufficient amount of remunerative freight; and, on the other, to effect a saving in the consumption of coal—a matter of the highest consideration on such distant voyages.
Although the anticipations of the directors, in the more recent and expensive portion of their great undertaking, have not been realised, while the services of the steamers on the West Coast have periodically, and especially of late, been subjected to considerable depression, the trade of the Pacific has steadily and, compared with any previous development, marvellously increased since first opened out by the energy of Mr. Wheelwright. Moreover, this trade is likely to go on increasing, especially as the company has now a class of vessels admirably adapted for its still increasing wants, and affording many comforts to passengers who, induced by numerous attractions travel either for business or pleasure, along the shores of the Pacific.
West Coast steamer, Bolivia.
The following is an illustration of one of the steamers now engaged on the Pacific coast line; but the Santa Rosa and the many similar vessels belonging to the Pacific Company now trading along these shores,[289] have been greatly surpassed by their screw-steamer Bolivia, of 1925 tons, launched from the building yard of Messrs. T. Wingate & Co., Glasgow, in 1874, and which is perhaps the finest, or at least, one of the finest vessels now afloat on the Pacific. The details of this handsome ship, which has an average speed of 14 knots an hour, as have also those of the other vessels of the company, will be found in the [Appendix], together with interesting and instructive returns of the cost of each ship complete for sea.[290]
“SANTA-ROSA.”
Future prospects of the company.
With the losses this company have sustained during the last few years, the differences between the shareholders and directors, and the charges of mismanagement and extravagance which have been alleged, it is not my province to deal. Companies and nations, like individuals, are frequently too prone to spend more than they ought, if unusual success has attended their efforts, or they find more money at their disposal than they can prudently or wisely expend. It has been so throughout all time and in all countries, and we daily see it in the case of individuals managing their own affairs.
It is, therefore, not surprising, and certainly nothing new to learn that, when the directors of the Pacific Steam Navigation Company were favoured with many years of unusual prosperity, after many years of hard up-hill work, and were able to divide an average of over 20 per cent. per annum among their shareholders, they should have followed the example of individuals, of companies, and of nations throughout all history; and that, in the sanguine hope of being able to maintain this prosperity, they should have expended money in the construction of ships not required, and for, perhaps, even less justifiable purposes.
It should, however, be remembered, of this great undertaking when its failings are noticed, that it has rendered very important services in developing British commerce and that, in bringing so many civilizing influences to bear upon the people of various republics, who, from their constant warfare with each other, were little better than tribes of semi-barbarians, the Pacific Company has essentially aided the cause of progress and the happiness of mankind. These advantages will be felt long after its mishaps are forgotten.
The field which the directors have chosen for their operations, is still only very partially developed, and there is, consequently, a great future for this company, if wisely and prudently conducted. It requires no prophetic vision to see that, as the commerce of the world moves westward, the principal highway to the ever envied and far famed East will be by the route which Columbus sought in vain across the Pacific Ocean. Indeed, San Francisco will soon be a greater entrepôt for trade than ever Venice was, and may, even before long, rival in many respects the now gigantic commerce of Great Britain.
Trade with Mexico.
The steady increase of trade along the whole of the western shores of the Pacific has already rendered necessary greatly increased means of intercourse with Europe and the United States of America, which the line of railway across the Isthmus has assisted to develop with extraordinary rapidity. Other channels of trade in that quarter have likewise been recently opened, rich in themselves and capable of vast extension, through the medium of steam.
First line of steamers from Liverpool to Chagres.
Although many schemes had been set on foot during the last three centuries, for re-opening the commerce of Central America, and, especially, of that portion of it which has its outlet into the Gulf of Mexico and the Caribbean Sea,—among these none being so conspicuous as the unfortunate Darien expedition—all attempts proved abortive until the latter half of the present century. Indeed, till the completion of the railway, none of these were worthy of any notice. So rapid, however, has been its increase since then, that the undertakings of more recent years have been attended with considerable success. Perhaps the most important of these is the line of steam navigation between Liverpool and the West Indies, and, thence, by the Isthmus of Panama, to the Pacific Ocean, originally due to Mr. Alfred Holt, of Liverpool, who about the year 1855, dispatched steamers to trade between that port and Colon (the Atlantic terminus of the Panama Railroad) and other ports on the Spanish Main. His first was a vessel of only 535 tons burden, but she was then more than sufficient for any surplus commerce, which the American boats, on the one hand and those of the West India Mail Packet Co., on the other, could not convey. The regularity, however, with which this additional service was performed, created increased sources of employment, so that within a very short time, Mr. Holt considered it desirable to establish a monthly line of steamers of increased size and power, and so rapid was the rise of trade that other steam-vessels were soon engaged in similar traffic. In 1863, Messrs Leach, Harrison, and Forwood of Liverpool, large importers of produce from the West Coast, found it necessary to establish a line of steamers in a great measure for their own requirements, and about the same time, Messrs Imrie and Tomlinson, in association with Messrs Duranty and Co., of Liverpool, who had long been engaged in the trade with Mexico and the West Indies, formed another line of steamers on the limited liability principle. The trade in its various ramifications had now become so large that, towards the close of that year, it was considered desirable to form a public company to amalgamate these three undertakings, and thus more thoroughly to conduct the rapidly increasing commercial intercourse between Liverpool, Mexico, Honduras, Venezuela, and the Windward Islands.
West India and Pacific Steam Navigation Company.
The capital of 1,250,000l. was at once subscribed, and this new undertaking now known as the West India and Pacific Steam Navigation Company (Limited), finding it necessary to re-organize the whole business and, in addition, to embrace the Colon trade, and other lines of traffic, subdivided the services into five separate branches—one to Belize, one to Tampico, one to Colon, one to St. Thomas, and one to Trinidad.[291] It was also arranged to dispatch steamers to Barbadoes and Demerara. The trunk or principal line of the company is that to Colon, in connection with the Panama railroad, and, by it, with the various steam lines on the Pacific, the company signing through bills of lading for no fewer than seventy ports, at sixteen of which their vessels call to land goods and passengers.
This undertaking, which has met with considerable success, conveys the British mails to Honduras and Mexico. It now owns thirteen steamers of 24,680 tons gross register. Though inferior in size and power to the steam-ships of the other Transatlantic lines, they are a very fine class of iron screw propelled vessels, maintaining an average speed of more than 10 knots an hour, and performing the passage with great regularity from Liverpool to St. Thomas in eighteen, and to Colon in about twenty-two days.
Besides those I have mentioned, various other lines of steam-ships now traverse the Atlantic north and south, as well as casual steamers and large numbers of sailing-vessels, most of the former being the property of associations carrying on business, either under the old law or under the Limited Liability Act.
Liverpool, Brazil, and River Plate Steam Company.
Among the largest of these may be mentioned the Liverpool, Brazil, and River Plate Steam-ship Company (Limited), which was formed in 1865, the principal shareholders being Messrs. Lamport and Holt, of Liverpool, by whom the steamers are managed, and a few of their personal friends. There is nothing, however, in their fleet of vessels requiring special notice, except that they are a very fine class of business steamers and have performed their work with great regularity. They are now thirty-one in number, of a gross tonnage of 49,294 tons,[292] and have excellent accommodation, combined with every comfort which passengers can desire, offering all the means of safety in their prudent management, and regularity of system, which can be hoped for in Transatlantic voyages.
Although the vessels of this company are principally engaged out of Liverpool, some of them sail from London and Antwerp, calling frequently at Havre and Lisbon in the course of their trade with the ports of Brazil and River Plate, Pernambuco, and Buenos Ayres. One of them proceeds monthly, up the River Parana to Rosario, and, occasionally, others return from Brazil to the United States with cargoes of coffee. Three are permanently engaged in the service of the Government of Brazil for the conveyance of mails between Rio de Janeiro and the southern ports, while others maintain a direct line of communication with Brazil and Antwerp. The Company is also under contract with the British Government to dispatch, on the 20th of each month, a steamer with the mails from Liverpool to Bahia, Rio Janeiro, Monte Video, and Buenos Ayres, returning with a monthly mail from each of these ports. Steamers are likewise dispatched on the 3rd, 10th, and 12th of each month to the other ports, with extra vessels at such dates as the requirements of the trade may demand. The last new steamer, the Herelius, of 2610 tons register, was built by Messrs. Andrew Leslie and Company, Hebburn-on-Tyne, and her engines, of 300 horse-power nominal, are by Messrs. Robert Stephenson and Co., Newcastle; she is an excellent specimen of a merchant-steamer, being 345 feet in length, 37 feet in breadth, and 27 feet depth of hold from maindeck, with a large capacity for cargo, and a speed on the measured or trial mile of from 11 to 12 knots an hour, on a moderate consumption of fuel.
Though, by an ancient Act of Parliament, the responsibility of shipowners has been limited—no doubt for the purpose of encouraging navigation—to the value of the ship and freight, numerous companies of shipowners have been formed, under the Limited Liability Act of 1862, consisting of a few individuals, as in the case of Messrs. Lamport and Holt’s line, for the purpose of conducting different branches of maritime commerce. Many of these are larger and more important undertakings than the great bulk of the public steam navigation companies, and have generally proved more successful from the fact that their managing directors usually hold themselves a very large amount of capital invested in them. To some of these I shall have occasion to refer hereafter. In the meantime, I must invite the attention of my readers to the trade with the East, as now conducted by steam-vessels.