Air New Zealand proposes airline consortium better fit for stake in Queenstown
Air New Zealand Group General Manager Australasia, Bruce Parton, called on (23-Jul-2010) Queenstown Airport to broaden its shareholder base and allow airlines to invest in the airport to ensure it has the financial strength to grow with the rapid rate of capacity being injected by the carrier along with Pacific Blue, Qantas and Jetstar. Mr Parton stated the move would spare travellers to/from Queenstown hikes in fares and criticised Auckland International Airport Limited's (AIAL) plans to acquire a 24.99% stake in the airport by subscribing to new shares worth NZD27.7 million (NZPA, 23-Jul-2010). If a consortium arrangement does not eventuate, Air New Zealand would be prepared to consider any proposal to contribute to, or underwrite, infrastructure development at Queenstown Airport, as the airline has done in the past. The carrier stated this would allow the community to retain full ownership of the asset. It also commented that it would support an official investigation into the Queenstown Airport sale by either an Ombudsman or the Office of the Auditor-General as suggested by former Local Government Minister and Queenstown Mayor, Warren Cooper. [more]
- AIAL: AIAL responded stating it was “bemused” by the comments (NZ Herald, 24-Jul-2010);
- Queenstown Airport: Chairman Mark Taylor stated the were a number of parties that had expressed interest in purchasing a stake in the airport but it selected the party with “the best fit” (The Southland Times, 24-Jul-2010). Mr Taylor added a bid by airlines is not a realistic option and the airport does not need other investors (Radio New Zealand, 25-Jul-2010). However, he stated it would be up to majority shareholder, the Queenstown Lakes District Council, if it wanted to sell shares;
- Queenstown Lakes District Council: District Mayor, Clive Geddes, stated the council is not interested in a bid from Air New Zealand;
- Jetstar: Air New Zealand met with Jetstar on 23-Jul-2010 to discuss the plan. The LCC stated it is sympathetic to the carrier’s concerns but could not join any action without support from parent, Qanta;.
Air New Zealand: “It would also see Queenstown Airport have investors who genuinely understand how to grow tourism into Queenstown – by keeping the cost of travel down. This is in contrast to Auckland International Airport Ltd which has a track record of gouging users like airlines, taxi and rental car companies to the point where they have to put up the cost of travel. Air New Zealand would be willing to lead a consortium of airlines to take a cornerstone shareholding in Queenstown airport and commit to ensuring the cost of travel stays down. We would not seek any dividends and ask that these be reinvested into the airport infrastructure to ensure it remains world class and can cope with increased demand due to all airlines offering attractive domestic and trans-Tasman fares. We’ve been committed to growing the Queenstown market for more than 30 years and want to ensure its ongoing success for decades to come. We believe the current arrangement will not be conducive to that and are not surprised by the level of community and business anxiety over AIAL’s investment. AIAL has displayed significant greed over several years and is adept at fleecing travellers; it would be naïve to think it’s not aiming to increase airline and airport charges which will ultimately increase the cost of travel into and out of Queenstown,” Bruce Parton, General Manager Australasia. Source: Air New Zealand, 23-Jul-2010.
Auckland International Airport Limited: “We're not taking this seriously. It would be a distraction from the alliance. We are committed to growing tourism in Queenstown,” Richard Llewellyn, Spokesman. Source: NZ Herald, 24-Jul-2010.