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Home / New Zealand

Mike Hosking: Shane Jones' Air New Zealand attack overflew the mark

Mike Hosking
By Mike Hosking
Mike Hosking is a breakfast host on Newstalk ZB.·NZ Herald·
21 Mar, 2018 05:32 PM3 mins to read

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Mike's Minute: 'Thuggish behaviour threatens Air NZ'
Mike Hosking
Opinion by Mike Hosking
Mike Hosking has hosted his number one Breakfast show on Newstalk ZB since 2008. Listen live each weekday from 6am on Newstalk ZB.
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Shane Jones, as appealing as his bombast, one-liners and devil-may-care approach to life may be, is now a dangerous man and has gone a mile too far with Air New Zealand.

He gets away with it, to the extent he is not the minister directly responsible for the airline. But I suspect he's the government's attack dog, representing a view every one of us should be worried about despite the wet bus ticket Jacinda waved his way yesterday.

In calling for sackings and resignations, in having the Air New Zealand board write to the government, you have a mess and a fight we don't need. It's shambolic, it's ugly; this is the stuff that is looked at internationally by people looking to put money here: what role does the government play, how active is the government, how verbal, how easy is it to do business.

This government is now Machiavellian. Ardern's argument that it's just an opinion, no longer holds water, and her telling-off changed nothing. Jones has crossed the line.

Saying he'd like more regional services? Fair enough. Threatening people, wanting people sacked, telling people to get back in their box, is thuggish.

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It's not uncommon in, say, a pub; completely out of line in the public arena between the Government as a shareholder and a major trading company. Boards need to run companies, not wage war with governments.

The reality is, governments by and large don't know what they're doing when it comes to business. This one is proving, whether with this loutish assault on an airline or their plan to ban foreigners in housing, that they are a mile out of their depth.

History is instructive.

Go back, and not that far, to when Air NZ couldn't turn a dollar and everyone hated it.

Look at the size of the cheque we had to write to save it. Look at the way it ran an airline, and where that got it. Look internationally today at airlines and how fragile they are, how the price of fuel turns a profit into a sea of red ink overnight.

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Opinion

Hooton: Flying in the face of reason

22 Mar 04:30 PM

Look at how Air New Zealand has to remain forever vigilant, agile and creative to stay afloat and successful in a world of massive carriers, the likes of which we should not normally be able to compete with, and yet we do.

The profits, the awards, the expansion tell you all the story you need to hear.

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If that goes pear-shaped, airlines don't lose a few million, they lose a few hundred million. The margins are tiny, the risk is huge. The government doesn't have the bank balance to bluster their way into financial catastrophe in a company they own 51 per cent of.

Could Air NZ put a flight on to Kapiti? Probably. Is there an overall argument that if regional New Zealand booms we need more flights? Probably.

But did Air New Zealand cancel any route because they were bored, vindictive or stupid? No. They cancelled them because they don't make money.

I say the same thing today that I said yesterday. If you want loss-making businesses paid for, who pays for them? How big are the loses you're prepared to take, who covers the difference, and how widely through the company do you want the losses to filtrate?

How low does the share price have to go, and shall we just sack the board and get Shane and Jacinda to run the lot, or maybe, just maybe, they can let people who actually know what they're doing, get on with it.

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