the Union Company anticipated competition from Matson Line of the USA, which had ordered two new liners, and , to run between the West Coast of the United States and Australia via Hawaii, Fiji and New Zealand. They would be swifter than Niagara and Aorangi, and the Federal government of the United States subsidised US ships US$10 per mile to carry mail, which gave them a competitive advantage over UK and Empire ships. In response the Union Company and Canadian Pacific created a new jointly-owned subsidiary, Canadian-Australasian Line, to which the Union Company transferred Niagara and Aorangi. In June 1936 the UK government commissioned an Imperial Shipping Committee to examine merchant shipping in the Pacific, including problems caused by subsidised US competition. Canadian Pacific's Chairman, Sir Edward Beatty, sought support from the governments of the UK, Canada, Australia, New Zealand and Fiji to improve Canadian-Australasian's trans-pacific service. He proposed a pair of , liners at a cost of £2.5 million if the governments would subsidise the service. P&O, which owned the Union Company, supported the proposal. The Imperial Shipping Committee recognised the problem but proposed no solution. In May and June 1937 an Imperial Conference considered matters including shipping, which faced increasing Japanese competition as well as subsidised competition from US ships. Beatty reiterated his proposal for new liners to replace Niagara and Aorangi. Hopes were raised but no agreement was reached. In 1938 Niagara celebrated 25 years in service. By then she had completed about 150 round trips between Australia, New Zealand and Canada. In July 1939 Sir Edward Beatty stated that the cost of shipbuilding had now risen too high for new ships to be ordered for the transpacific route. Instead there was a proposal that the Canadian Pacific liner , or one of her sister ships, could be modified for trans-pacific service to replace Niagara. On 1 September 1939 the Second World War began. That October Canadian-Australasian Line introduced a 33 percent war surcharge on passenger fares. In January 1940 this was reduced to 15 percent to encourage travel between Australia and New Zealand. Loss On the night of 13–14 June 1940 the laid a field of 228 contact mines across the mouth of the Hauraki Gulf: in a bid to blockade Auckland, New Zealand's largest commercial port. For the next four days ships passed in and out of Auckland without hitting any of the mines. On