Tony Gibson: Auckland is the first port of call

Shipping freight to Auckland and then driving it 15km will always beat shipping it to Northport and driving it 150km, says Tony Gibson.

COMMENT:

The idea of moving or closing Auckland's port is alluring. The port land is a tempting blank canvas and it's fun to draw a picture of what could go on it if the port wasn't there. I've lost count of how many of these pictures I've seen in my time here.

The pictures look nice but drawing them is the easy part. It's a feel-good PR exercise. Actually moving a port — which in reality means building a new port and all the supporting infrastructure — is hard. It also has major consequences for Auckland and the rest of New Zealand.

Such an important infrastructure decision needs sober consideration of cold hard facts. Yes, I know that's boring, but you wouldn't let your kids run the household, right? It'd be online games all day, Uber Eats every night and no chores!

It's the same with the port decision. So let's ignore the spin doctors for a while and look at some facts.

It's stating the obvious, but New Zealand is an island. Our imports can only come here by ship or plane and almost all of them come in by ship. We need ports.

Our land transport costs are high. We live on a long, skinny, shaky, hilly island, so building roads and rail is challenging and expensive. The further you go by land, the more it costs, which is why cargo tends to go through the port closest to the source for exports and closest to the demand for imports.

That's also why we've got so many ports in New Zealand, and it's a good thing. Imagine driving logs all over the country instead of taking them to local ports like Napier, or Eastport in Gisborne.

Auckland is our largest population centre with the highest demand for imports. Locating Auckland's port hundreds of kilometres away flies in the face of globally accepted supply-chain practice. We are not special. The rules that apply elsewhere also apply here, especially because our land-side transport costs are so high. So, the starting point is that if Auckland's port is moved from downtown, it should still be in Auckland. Not Northland.

Auckland port is the only viable option, says Tony Gibson. Photo / File

Why should the port be moved?

Is it full? Is it no longer fit for purpose?

Contrary to popular belief, Auckland's port isn't about to run out of room. Our existing master plan provides the capacity we need until 2050. Beyond 2050, existing cargo-handling technologies could be used to increase capacity further.

Auckland's port could handle the freight needs of an Auckland population of around 5 million without further reclamation.

Road and rail links are not an issue. There is ample capacity in the existing rail link to the port and recently announced investment in the line will improve that further. There are many levers we can pull to improve the capacity of the road links to the port. Port trucks make up less than 7 per cent of the vehicles on The Strand in Parnell, the busiest port access route.

Trucks avoid commuter peaks for obvious reasons, but there is still scope for trucks to make more use of off-peak capacity at weekends and nights. Congestion charging or demand management would also help, and the advance of electric and hydrogen trucks will take away two key negative impacts of trucks, noise and emissions, making night-time trucking more welcome. Incidentally, electrification of this part of the supply chain could happen soon because most container moves to and from Auckland's port are short-haul. Trials are already underway.

In short, Auckland's port is not running out of room and it does not have to be moved. However, some Aucklanders want it moved because they don't like having a port downtown. That's an important distinction and I think we should own it. There's nothing wrong with wanting to move the port, just don't pretend you're moving it because you need to.

When you realise it's a want rather than a need, the cost of a port move becomes important. What you spend on one thing you can't spend on another.

There are not many of us in New Zealand, so the cost of closing Auckland's port and building the infrastructure you need to move Auckland's freight via, say, Northland would be high per person. That cost has been put at $10 billion, which works out at $2000 a person.

Tony Gibson. Photo / Supplied

Of those people, 4.3 million live outside Auckland and won't benefit from Auckland not having a port downtown. I'm not sure New Zealanders living outside Auckland want to pay $2000 each so a few wealthy Aucklanders can have a nice apartment on the waterfront.

Remember, that's $2000 for every man, woman and child in the country. The cost per taxpayer would be more. You could do a lot of good with that much tax money. Build better hospitals. Improve schools. Reduce child poverty. So before we spend $10 billion of hard-earned taxes on a new port, we should consider what we have to forgo to make that happen.

Carbon emissions and ongoing costs

Transporting goods further over land increases carbon emissions. Shipping freight to Auckland and then driving it 15km will always beat shipping it to Northport and driving it 150km. Yes, trains emit less than trucks, but nothing beats shipping. At a time when we are really starting to feel the effects of global warming, unnecessarily increasing emissions seems a bit reckless.

Transporting goods further over land also costs more. Currently this cost for goods shipped via Tauranga to Auckland is kept low because of competition. But what do you think will happen if the competition provided by having a port in Auckland is removed? Respected economics consultancy NZIER found the answer: the cost of imports will rise and an Auckland family of four will pay between $1250-$1470 a year more for the things they buy. That is going to hurt a lot of people.

Resilience

Would you leave your largest city, over 1.7 million people, without a port? Reliant on two long, fragile road and rail links? Northport and Tauranga are more vulnerable to tsunami than the Auckland port.

Tauranga is more susceptible to earthquakes. When the Kaikoura quake cut the South Island Main Trunk rail line and State Highway 1 we had a second road route and coastal shipping via Lyttelton, but it was still a major effort to keep the freight moving. Without a port in Auckland, an earthquake in the Bay of Plenty or slips in Northland could cause serious issues for the people of this city.

I have by no means canvassed all the issues, just a few that came to mind. We'd also need to consider the environmental impact of building the new port, roads, rail, etc. The impact on jobs — having a port in Auckland facilitates over 170,000 jobs in the city and tens of thousands of jobs are directly linked to port activities. Those people have lives, kids, parents, social networks — are we really saying we're going to uproot them and send them north? How much would the vacant port land be worth? Enough to pay for a new port? Given that most of the drawings I've seen of post-port paradises include large areas of parkland and low-rise buildings, I've got my doubts.

There is a lot to consider. There have been six or seven studies about moving the port in my nine years as CEO. That's a lot, but because the last study was such a shambles, I'm pleased the Ministry of Transport and Treasury are doing another one.

They're a sober lot. I'm hopeful they'll give us a much clearer idea of what it will take to move Auckland's port.

• Tony Gibson is chief executive of Ports of Auckland.