Encouraging start for new airport CEO

By CHRIS DANIELS aviation writer

Don Huse, just two weeks into the job of chief executive of Auckland International Airport, yesterday sent out a press release that any manager would be proud to put his name to.

Twice a year, the airlines introduce new programmes with their intended schedules for the different seasons.

The proposed schedule for the northern winter - our summer - has now been compiled, Huse told the Stock Exchange, and it should result in a 30 per cent jump in seat capacity.

The extra seats come from three new entrants to Auckland skies - Emirates, Asiana and Royal Brunei - and expanded service from existing carriers flying here.

And it could end up even better than it looks, because the latest predictions are without the likely impact of flights from Australian budget carrier Virgin Blue, expected to start flying the Tasman, and possibly within NZ, this year.

Huse, former chief executive of Wellington Airport and most recently chief financial officer at Sydney Airport, told the Business Herald that one of his challenges would be to cope with the rise in passengers expected at the airport.

He is stepping into big shoes in his new job; former chief executive John Goulter was widely praised as a canny business leader and operator.

But Huse is no stranger to the smell of aviation fuel and the check-in queues of big airports.

"What I bring to the job is experience in airport management going back to 1991. That's the strength I bring.

"I'm well familiar with the industry in New Zealand, I'm well familiar with it in Australia and that's the knowledge and experience that I'll be bringing to bear here."

Auckland Airport earns about half of its revenue from non-aeronautical activities such as parking and rental. This will only grow, says Huse.

"Auckland Airport is a very good international example of how airports can diversify their revenue base, with all the advantages that brings, and effectively leverage off the volumes of international and domestic traffic and cargo that goes through the port."

In addition to this, says Huse, the airport is "blessed" with a big reserve of available land for property development. A new, smaller, runway for non-jet aircraft has full resource consent, and the company hopes to have it operating in around five to six years' time.

A lot of this ability is due to the vision of the people who decided to build Auckland's international airport at the Mangere site, says Huse.

"We should pay credit to the foresight of the people who decided to build an airport to service Auckland on a greenfields site like this, because what that foresight has delivered to the community is an Auckland facility here that can service the needs of Auckland for at least the next 50 years."

Both Wellington and Sydney airports were coping with the problems that came with being built within the confines of ever-expanding cities, said Huse.

"It was an amazing insight at the time which the community as a whole is reaping the benefits."

One big challenge for the airport was the unpredictability of the market - September 11, Sars, the war in Iraq. The industry was, however, resilient, able to bounce back quickly after a shock.

In the past 10 years, international passenger growth had been compounding at between 6.5 per cent and 7.5 per cent a year.

"The challenge of this is coping with the increase in demand carefully, without spending too much money on things that are not yet needed.

"It would be unwise for an airport to over-invest in capacity, because that's not operating in a commercially efficient way. The trick is always to balance capacity with the needs of the airlines."

The impending arrival of Emirates and the likely appearance of Virgin Blue is "a most unique event by any measure", says Huse.

Such a unique event means Huse starts his job with something of a tailwind. But the unpredictability of his business makes it impossible to predict whether this fortuitous takeoff can propel him to the lofty heights of his predecessor.