Auckland Airport’s redevelopment plan. Video / Supplied
Auckland Airport has confirmed plans to build a new domestic terminal as part of $3.9 billion in capital spending airlines say will push up airfares.
The airport today said the new terminal, which will be integrated with the existing international facilities, is essential, but a group representing airlines has warnedsale fares in particular will have to go up to pay for it.
The new terminal will open later this decade.
The Board of Airline Representatives says consultation with the airport was still underway and it had been blindsided by today’s announcement.
“This $3.9 billion spend gets pushed on to airlines in fees that end up in ticket prices,” the board’s executive director Cath O’Brien said.
Auckland Airport’s planned new integrated terminal. Image / Supplied
The airport’s chairman Patrick Strange said the company had been consulting airlines since 2011 and the company said its charges only made up a small percentage of domestic airfares.
“The domestic terminal is almost 60 years old and needs replacing. It’s nearing capacity and it’s no longer fit for purpose and hasn’t been for some time. If it wasn’t for the pandemic, we would already be well underway with its replacement,” he said.
“We have worked with major airlines for over a decade on this. We’ve considered all feedback, including potential alternative locations and even further delays to infrastructure development. All of this has been carefully thought through and we have made changes where appropriate, but now we need to get on with it,” Strange said.
But O’Brien said final submissions weren’t due until next week.
“Prices set on the basis of this scale of capital investment risk damaging the aviation market to, and within, New Zealand,” she said.
What the new Auckland Airport domestic terminal at the eastern end of the international building will look like. Image / Supplied
“The airport is a monopoly. No company should be able to engage in monopolist behaviour in an economy like New Zealand.
Airlines had last week presented views on the risk of increased airport charges - which are always passed on to passengers - hitting demand for air travel.
“Instead, Auckland Airport is pressing ahead with capex decisions, ignoring airline concerns and the required process. Airlines consider this is both unwise and unjust .”
Strange said the announcement today followed an earlier decision in 2011.
The $3.9b construction programme to take place over the next five to six years, including the spending of about $2.2b combined terminal plus a number of other key projects associated with that development.
The terminal integration programme – a significant part of the airport’s wider 10-year-capital programme – will bring domestic travel and international travel together under the same roof for the first time since 1977, through the expansion at the eastern end of the existing international terminal building.
“It will make travel easier and faster, cutting domestic jet to international transfer times to a five-minute indoor walk. A new check-in experience will provide state-of-the-art facilities for both domestic and international travellers, including the ability to check in and store your bag at any time throughout the day,’' said the airport’s chief executive Carrie Hurihanganui.
A new smart baggage system is being installed and there will be faster links to public transport via the new Transport Hub we are building on the doorstop of the international terminal.
Regional turbo prop flights to smaller centres, will remain in the existing domestic terminal for now, with Auckland Airport currently consulting with major airlines and BARNZ on the future location for regional travel.
The airport says its domestic charges of $7 typically make up about 3 per cent to 4 per cent of the cost of an average domestic airfare in 2022.
