Air New Zealand seeks urgent inquiry into regulation of Auckland Airport

Air New Zealand has today lodged an official request with Commerce Minister Andrew Bayly seeking an urgent inquiry into the regulation that is failing to constrain overspending by Auckland Airport.
21 February 2024
  • Auckland Airport redevelopment cost will make flying unaffordable for some Kiwis unless there is regulatory change
  • Aeronautical charges at Auckland Airport forecast to increase from ~$9 per domestic passenger today to ~$46 per domestic passenger in 2032
  • Airport refuses to pause redevelopment, despite expert advice the cost could be reduced significantly
  • International Air Transport Association (IATA), Qantas Group, BARNZ and A4ANZ support inquiry
  • Other more balanced regulatory options are available that don't require a law change, but time is running out


Air New Zealand has today lodged an official request with Commerce Minister Andrew Bayly seeking an urgent inquiry into the regulation that is failing to constrain overspending by Auckland Airport.

Auckland Airport has proposed a massive $7 billion to $8 billion development over 10 years – Air New Zealand believes it will be bigger than the combined investment by all three airports regulated by the Commerce Act over the past 30 years. This will be paid for by airlines through steadily increasing aeronautical charges, leading to unaffordable airfares for some Kiwis. 

Air New Zealand Chief Executive Greg Foran says this is the most any privately owned airport has spent in such a short time, delivering very little new capacity.

"The new airport will look great, but this spend doesn't deliver an additional runway and there will be virtually no increase in airside capacity for more customers. By 2032 the value of the airport's asset base, which dictates the size of its charges, will have increased per-passenger domestic charges five times, with more to come in the future.

"Air New Zealand agrees the airport needs redevelopment, but not at a cost that means some Kiwis can't afford to fly. This issue affects all passengers flying through Auckland Airport – especially those from the regions.

"Last year with the help of the same international experts that worked on AIAL's 30-year Master Plan, we provided the airport with alternative terminal designs that would be significantly cheaper, while still providing a great facility. We also shared data on the serious impact their spending will have on demand for air travel. They have not paused and plan to keep pouring concrete.

"Auckland Airport will argue that it consulted with Air New Zealand, but it has ignored our warnings and there has been no meaningful change. It has received the same feedback from Qantas Group and BARNZ that this is not affordable and will cost the traveling public. The business case has been seriously questioned by IATA.

Mr Foran says the impasse shows the current 'Information Disclosure' regime within the Commerce Act is failing consumers, but there is a solution.

"The Commerce Act has pre-existing alternative options to keep regulated airports under control. These include steps that require airports to negotiate with their customers on a commercial basis, go to arbitration if that fails, or the regulator can set the price and quality of their service," says Mr Foran.

"The good news is neither of these options require new law to be passed – the Commerce Act already provides options, so it's not a case of more red tape. We are simply asking the Commission to launch an inquiry to determine which regulatory option is best for consumers."

The International Air Transport Association (IATA), has also made a submission to the Commerce Commission asking for greater scrutiny of regulated airports in New Zealand as has Qantas Group, Airlines for Australia and New Zealand (A4ANZ) and the Board of Airline Representatives (BARNZ) which represents 26 airline members and five non-airline members.


Issued by Air New Zealand Communications.

Email: │Twitter: @AirNZMedia

About Air New Zealand

Air New Zealand's story started in 1940, first taking to the skies between Auckland and Sydney on a flying boat - a Short S30. Known for its warm Kiwi hospitality, today, the airline has 104 operating aircraft ranging from Boeing 787-9 Dreamliners and Airbus A320s to ATRs and Q300s, offering customers comfort in the latest most efficient jets and turboprops. It's a modern fuel-efficient fleet with an average age of 7.3 years. Air New Zealand's global network of passenger and cargo services centres around New Zealand. Pre-Covid, the airline flew more than 17 million passengers every year, with 3,400 flights per week. Air New Zealand was recently named the World's Safest Airline by the Australian rating service, highlighting the airline's laser-focus on safety. Last year, Air New Zealand won Best Corporate Reputation in New Zealand – 8th year in a row.

Air New Zealand has a well-connected domestic business, connecting customers and cargo to 20 different regions around New Zealand. Internationally, the airline has direct flights to major cities across Australia, Asia, the Pacific Islands and the US, and through its strong relationships with alliance partners, offers customers more choice and convenience to connect further afield to hundreds of destinations. Air New Zealand has a particular focus on sustainability and its Sustainability Framework  helps guide the airline's efforts in tackling some of New Zealand's and the world's most complex challenges. Air New Zealand aircraft are proudly identified by its distinct tail livery of the Mangōpare, the Māori symbol of the hammerhead shark which represents strength, tenacity, and resilience.


About Star Alliance

Air New Zealand is proud to be a member of Star Alliance. The Star Alliance network was established in 1997 as the first truly global airline alliance to offer worldwide reach, recognition and seamless service to the international traveller. Its acceptance by the market has been recognized by numerous awards, including the Air Transport World Market Leadership Award and Best Airline Alliance by both Business Traveller Magazine and Skytrax. The member airlines are: Aegean Airlines, Air Canada, Air China, Air India, Air New Zealand, ANA, Asiana Airlines, Austrian, Avianca, Brussels Airlines, Copa Airlines, Croatia Airlines, EGYPTAIR, Ethiopian Airlines, EVA Air, LOT Polish Airlines, Lufthansa, Scandinavian Airlines, Shenzhen Airlines, Singapore Airlines, South African Airways, SWISS, TAP Portugal, Turkish Airlines, THAI and United. Overall, the Star Alliance network currently offers more than 18,500 daily flights to 1,321 airports in 193 countries.