A terminal expansion that will cost billions of dollars over 10 years is excessive and will only result in the travelling public and aviation operators, small and large, paying more.
But Auckland Airport returned serve.
“This is the latest move from airline lobby groups looking to delay much needed infrastructure investment at New Zealand’s gateway airport,” said a spokeswoman.
Auckland Airport was building the resilient gateway New Zealand needs, she said.
The spokeswoman described it as careful, sensible investment that is benchmarked and supports regional airlines to run their businesses, including transport, terminals, runway and utility (aircraft fuelling) and airfield upgrades.
“Most importantly, we are building a new domestic jet terminal that will increase capacity by 26 per cent, enabling choice and competition for travellers - that’s what keeps airfares in check,” the spokeswoman said.
As airports are user-pays systems, only passenger airlines will pay for the new terminal infrastructure and only when it is completed and in use.
Wallace said as it currently stands, the terminal expansion would provide little real benefit for the smaller regional airlines servicing the domestic terminal and there is no extra terminal space.
“The smaller regional airlines provide vital connectivity to regions, that otherwise would not have a commercial service such as Kaitāia, the Coromandel, Kāpiti, Whanganui and Whakatāne. If they cannot sustain the extra cost, which might well be the case, they won’t easily be replaced,” said Wallace.
The airport company spokeswoman said regional airlines were ‘‘an extremely important’' part of the aviation landscape at Auckland Airport.
“We have worked tirelessly to enable them to be operationally and commercially successful because of their importance to the regions they serve. Auckland Airport rejects any suggestion that our infrastructure programme will make regional travel unaffordable.”
The spokeswoman said Auckland Airport’s domestic and regional charges have been “rock bottom” for years.
“Today regional charges make up a fraction of the cost of an average regional airfare (4 per cent) and by 2027 they will be in the same ballpark as Christchurch and Wellington airports.”
Regional charges increased by $2.70 in July from $4.40 to $7.10 – this is $3 to $4 cheaper than comparable current charges at other major New Zealand airports. Regional prices will average $8.15 over the current four-year pricing period.
The spokeswoman said regional airfares to and from Auckland are significantly higher than they were pre-Covid (30 per cent higher in 2023 than 2019 or $39).
Regional airfares increased 16 per cent between 2022 and 2023, higher than inflation which was 4.7 per cent in the 12 months to December last year.
A review is under way of future aircraft movements, the efficiency of the system, and what this means for the operation of services such as air ambulance.
Wallace said his association understood Auckland Airport has an obligation to provide dividends to shareholders, but it is not in the public interest for one organisation to have total control over what the public needs.
“Aside from an inquiry by the Commerce Commission into the practices adopted by Auckland Airport, what we really need is some realism on the part of the airport.”
AIANZ’s members are also experiencing pushback from the airport on other matters, he says.
“Air ambulance services, for example, are parked on tarmac areas to unload critically ill patients, but without cover from the weather. Despite best efforts to engage with management over several years on solutions, Auckland Airport had shown little interest.’'
Grant Bradley has been working at the Herald since 1993. He is the Business Herald’s deputy editor and covers aviation and tourism.
