13 Sep 2007
International passengers grew at 6.2% in August from the previous year despite a 7.4% fall in capacity. The Airline load factor on international services for August was 71.9%. Year to date growth in international passengers now stands at 6.8%, with seats down 4.0%. While growth continues to remain robust demand remains constrained due to withdrawal of seats. In particular, some Tasman sectors offer little room for growth without additional capacity.
Despite strong demand, domestic passenger volumes remain subdued with growth of 2.0% in August on a 2.6% reduction in seat capacity. The average domestic load factor in August was 3.3% above the previous year. Year to date, domestic passengers are now marginally above the previous year despite a 3.9% fall in seat capacity.
The announcement by Pacific Blue that it will commence domestic operations in New Zealand from mid-November is a significant boost for the travelling public, bringing new prices and services.
Terminal developments are continuing, with construction completed on the new landside duty free store and shortly to commence on new foreign exchange outlets. The airside works construction programme to add an additional aircraft aerobridge gate and to help accommodate the capacity required by Pacific Blue is also underway. WIAL will shortly commence work on the runway safety compliance works at the Northern End of the runway with completion targeted for early 2008.
Pursuant to a request from Air NZ, WIAL agreed to disclose details of the passenger growth agreement between WIAL and Air NZ that expired on 30 June this year. This had been agreed between WIAL and its major customer in 2003 and meant that Air NZ paid no airport charges for passengers above a specified level ie its marginal cost of growth in terms of airport charges was effectively zero. Because of the success of Air NZ's Express product this resulted in the airline achieving a substantial saving (in the year to 30 June 2007, approximately 20% of Air NZ passengers used WIAL for no charge). WIAL endeavoured to work with Air NZ to roll this agreement over, but unfortunately a renewal appears to have fallen victim to Air NZ's legal and regulatory efforts to challenge WIAL's charges and ability to progress its investment in new airport capacity.
A point of clarification is warranted. It has been reported
in the media that a new agreement was unacceptable to Air NZ because it was linked to Air NZ providing long-haul services to Wellington (eg direct flights to Singapore). This is incorrect and the two matters have never been related. In any case aircraft for long haul services will not be available for several years.
© Copyright Infratil