Air Chathams carried 4013 passengers on the Whanganui-Auckland route in August. Photo / NZME
Air Chathams is working on an infrastructure plan as it builds a case for moving its operation to Whanganui.
The airline’s chief executive Duane Emeny has met with Whanganui District Council to discuss what was required to build an operations and maintenance base in Whanganui.
“If it became an operational base, we would need an administrative area, training rooms, office space, all that stuff,” he said.
“We will go back to them with some high-level plans.”
He said it was a really exciting project.
“The benefit for Air Chats [Chathams] is one would hope we would be paying 50% of what we have to pay at the moment for market rate here in Auckland for our lease.
“That is a significant saving every year and if we can get our team motivated to make the shift, your average living costs in Whanganui compared to Auckland is chalk and cheese.”
The airline carried 4013 passengers on the Whanganui-Auckland route in August, slightly more than the same month last year but down by around 370 on pre-Covid-19 numbers in August 2019.
Emeny said the route was the airline’s most profitable of the three it operated in the North Island but revenue was still down by 5-10% on last year.
It was dangerous to judge success on passenger numbers alone, he said.
“I could do 5000 [passengers] next month by dropping the fares by $50 but I won’t be able to pay my bills.”
Council chief executive David Langford said a relocation would be great for the airport and the economy but there was “a fair bit to work through” before a deal could be done.
Price-wise, Whanganui was a lot more competitive than bigger centres, he said.
“It’s as much about selling what a great place Whanganui is.
“Businesses want to make sure their staff have good quality of life and plenty of choice when it comes to housing.
“Then, how competitive we are in terms of the cost of rates and leases.”
On June 1, landing fees for Air Chathams’ SAAB 340B rose from $111.90 per arrival to $174.92, then to $216.79 on July 1.
However, the bigger ATR aircraft, which currently flies in and out of the city four times a week, is charged the same landing fees as the SAAB, saving Air Chathams around $33,000 a year.
Langford said businesses planning on moving to the district could be offered discounted leases on council-owned land - for the first year.
“We can also do deals around a rates holiday, particularly if they are a start-up building and have to go through a period of construction.
“Council misses out on a small bit of rates in the short term but it means we bring more businesses in that pay more rates in the long term.”
In April, Whanganui mayor Andrew Tripe said there had been discussions about Air Chathams expanding its service to Christchurch.
“We think there is an upside for them to expand their network and grow their business, but also for us to attract different customers to Whanganui,” he said.
During the council’s long-term plan (LTP) process, Emeny proposed the council invest in the route instead of building a parallel taxiway at the airport.
He said a move to Whanganui and a Christchurch route were “definitely still on the table” despite the current economic climate.
“You have to start planning for when conditions are better and they’ll support it.”
Langford said as part of the LTP, money was put aside for strategic planning around land use at the airport.
“We do have land that could be developed and we could build more hangers and lease them out to airport users.
“We’ll do a little bit of planning and make some small investments which should bring money into the council, which means we don’t have to charge so much in rates.”
He said conversations with Air Chathams would continue.
“They provide a really valuable service and keep us well connected up to Auckland.
“We would love to welcome them here. They would be a great addition to Whanganui.”
Mike Tweed is a multimedia journalist at the Whanganui Chronicle. Since starting in March 2020, he has dabbled in everything from sport to music. At present his focus is local government, primarily the Whanganui District Council.