The story
Foundation of the ZVTM
On 23 May 1911, the government approval for the foundation of the Zeeuwsch-Vlaamsche Tramweg Maatschappij came in. On 29 June 1911, the contract that established the ZVTM was registered in Terneuzen. Mr. Lippens, a lawyer from Ghent, became president of the company. Mr. P. Dieleman from Middelburg became secretary. The other members of the supervisory board were: Engineer Paul Lippens from Ghent; L. de Groot from Antwerpen; Mr, Ninave, director of the Franz Wittouck sugar factory in Zelzate; P.F. Fruijtier member of the Dutch parliament; Aug. Heijlen of the Vicinaux in Louvain; J.A. van Rompu shipping agent in Terneuzen; and mr. K.P. Vermandele of the Rotterdamsche Bank. The Lippens family owned a big part of Moerbeke Sugar Factory.
In its final form, ZVTM would get a share capital of 800,000 guilders, divided in 1600 shares of 500 guilders each. Fruytier, Dieleman, and Heylen would form the executive. The supervisory board remained almost identical. Of the share capital, shares worth 110,000 guilders were not taken initially.
It was easy to merge the concession Fruijtier into the new company. Merging IJzSM into ZVTM took more time. On 26 April 1911, an extraordinary meeting of IJzSM shareholders took place right after the regular annual shareholders meeting. A proposal to sell the assets of IJzSM and then to liquidate it failed, because there were not enough shareholders present. In October 1911, another extraordinary shareholder meeting was held. It discussed a proposal to abolish the company and to transfer everything to the ZVTM for 110,000 guilders in shares of that company. This proposal was approved.
1920s
For public transport, ZVTM had to connect to the ports of Zeelandic Flanders. At the time, these were: Breskens, Hoofdplaat, Philippine, Terneuzen, and Sas van Gent. Of these, Breskens, Terneuzen, and Walsoorden had steam ferries across the Scheldt. At Sas van Gent, Axel and Moerbeke, ZVTM connected to the Belgian State Railways.
Carrying freight, especially sugar beet, was about as important as carrying passengers. ZVTM had direct connections to Sugar Factory Sas van Gent, Eerste Nederlandsche Coöperatieve Beetwortelsuikerfabriek, the sugar factory in Selzate, and Moerbeke Sugar Factory. It also connected to the chemical plant in Sas van Gent. Across the network, there were 43 big loading tracks. These were 80–180 m long and 15 m wide, excluding the track itself. These were paved and had a railroad scale. Three others were smaller. Six loading tracks were heightened for easy transport of cattle and machinery.
In business, ZVTM had a difficult start. In 1920, revenue increased from 506,209 to 672,645 guilders, i.e. by 33%, but the cost increased by 45%. Salaries alone increased by 66%. That year, earnings before interest and taxes were 89,673 guilders but the result was a net loss of 16,140 guilders. Transport of sugar beet increased from 80,306t in 1919 to 112,830t in 1920. Passenger traffic decreased. In 1923, ZVTM reorganized, leading to less employees and lower wages. In 1922/3 138,500t of beet were transported. In 1923/4 this was 148,500t. Passenger traffic decreased again due to competition from regular and irregular bus services. Net profit in 1923 was 51,912 guilders. In 1924/5 164,500t of beet were transported. In 1925/6, this was 152,500t. Passenger traffic increased slightly by giving strong reductions. In 1926 128,000t of beet were transported. In 1927, this was 122,000t. 1929 was very stable year, with a reasonable profit. Beet transport was 120,500t and passenger traffic remained stable. In 1930, 126,000t were transported. The gradual decrease in the amount of sugar beet that it transported was worrying for ZVTM, because lorries were taking an increasing chunk of this traffic.
The seat of the company was moved from Drieschouwen to the Scheldekade in Terneuzen on 12 October 1925.
1930s
In about 1930, most local tramways were in deep trouble. World War I and the years immediately following it, had caused a drastic increase in the cost of labor. The government had reacted by giving a emergency subsidy on fuel, but by 1929 this had become a permanent subsidy. Meanwhile, busses and lorries gave strong competition to the local tramways. The government then appointed the commission Van der Vegt. It had to investigate what was to be done.
Read the full text
One of the things that the commission noted, was that the bus companies were cherry-picking on the tramways. While the trams were legally bound to offer transport in a region, the bus companies preferred to ride on the more lines at busy hours. The central government had been too slow to bind bus companies to similar conditions. In general, the commission noted that trams were slower (35 km/h) than the new means of transport. Therefore new local lines for passenger transport were unlikely. This did not apply to freight traffic. In the end, te report did lead to a change in how local tramways were subsidized.
The overview of ZVTM's revenue shows how serious ZVTM's problems were. Much of its business disappeared, and would not come back. Over 1931, ZVTM suffered a loss and did not pay dividend. This was repeated in 1932. 1933 was the same, and so ZVTM took measures to reduce losses. In June 1934, it cancelled passenger service between Axel and Moerbeke. It also fired 9 employees. In 1934, ZVTM also changed its articles of association, henceforth these referred to public transport, instead of a number of railways.
In 1935, ZVTM began to operate a number of bus lines, which led to complaints from local bus operators. In fact ZVTM had already experimented with busses on the Hulst–Walsoorden line, but in 1935 these were replaced by Diesel motor coaches (see below). These were also allowed to go faster: 55 km/h instead of 35 km/h.
By 1935, ZVTM's situation had become catastrophic. Over 1931 to 1935, losses had been: 114,300, 57,800, 39,300, 50,700, and 29,610 guilders. ZVTM concluded that developments had made most of its assets worthless and made an extraordinary depreciation that increased the 1935 loss to a stupendous 3,951,268 guilders. This was related to a plan that would write off 85% of the shares (a 500 guilder share would become a 75 guilder share) bond holders would have to accept a lower interest: 2.5% instead of 5%. Finally, the government had to lower its claims (advances) against the company by 85%. On 18 January 1936, both the bondholders and the shareholders agreed to this plan. In February, ZVTM fired another 20 employees.
The advances were interest-free loans of 941,183 guilders by the province and 1,778,167 guilders by the Dutch state. Zeeland province first wanted to investigate the matter. The national government was in favor of the restructuring, but would let Zeeland decide. When the report appeared in June, it was not that favorable. It said that the salaries and number of top employees at ZVTM was way too high. It recommended: to put an end to the murderous competition in the area; to severely limit the salaries at the top; and to end the practice of some members of the provincial government being a member of the supervisory board as private persons.
The report created such a row that in the end, the provincial and state government only wanted to write off 85% of the advances if ZVTM merged with Tramweg Maatschappij Breskens–Maldeghem. The company then suggested that the shareholders and bond holders would do their part without the provincial and national government doing theirs. On 21 January 1937 both agreed to this proposal. On 17 February 1937, ZVTM then got the remission in the Eerste Kamer, without the condition that it should first merge with Breskens–Maldeghem.
Over 1936, ZVTM claimed a profit of 48 guilders. Total revenue was 199,313 from trams and 67,783 guilders from road transport. Over 1937, the profit was 21 guilders. 72,500t of beet were transported. ZVTM started 1938 by firing 11 employees. During the year, revenue continued to decrease. The bad harvest caused that only 60,000t of beet were transported. Profit was only 185 guilders. 1939 was a lot better, as revenue increased from 243,673 to 313,686 guilders, an increase of 28%.
In early 1939, ZVTM and BM finally agreed on a merger. When ZVTM agreed that BM's shareholders were entitled to 30,000 guilders that the Belgian government had recently, BM's supervisory board dropped its demand that their director should be in charge of the new company. However, one of the primary creditors of BM had a mortgage on its assets and refused to cooperate. In turn, this led the Zeeland government not to agree to the 85% reduction of the advances.
From Wikipedia’s article on Zeeuwsch-Vlaamsche Tramweg Maatschappij, shared under CC BY-SA 4.0.3