Air NZ hits out at Pacific Blue over airbase

By IRENE CHAPPLE

SAN FRANCISCO - Air New Zealand has attacked rival Pacific Blue over the discount airline's plea to the Government to fast-track plans for a new commercial airport at Whenuapai.

The local arm of Richard Branson's Virgin Blue came under attack from Air New Zealand chief executive Ralph Norris at an industry conference in San Francisco.

He said it disturbed him greatly to read of Pacific Blue's appeal to Prime Minister Helen Clark.

Pacific Blue chief executive Tony Marks had written a letter to Clark saying it had become apparent that without Whenuapai, both Pacific Blue and the interests of New Zealand air travellers would be compromised.

That comment, said Norris, was "nothing short of grossly inaccurate. The reality is that Pacific Blue is wanting a sweetheart deal. They are seeking an unfair advantage in relation to the commercial rates that Air New Zealand and around 20 other carriers face at Auckland Airport".

Norris said: "I can understand where [Pacific Blue] are coming from but they're trying to use Whenuapai as a lever to put pressure on Auckland International Airport. They're playing games."

Pacific Blue is trying to speed up the Whenuapai airport because it says Auckland airport is not offering it reasonable terms to fly domestically.

Auckland Airport is lobbying against a joint proposal by Waitakere City Council and infrastructure investor Infratil to set up a new commercial airport at the West Auckland airbase.

It told Pacific Blue it could either work around the other airlines, or pay $3 million for its own terminal. Discussions between Pacific Blue and the airport are continuing.

The fast-track of a Whenuapai base holds little attraction for Air New Zealand.

Norris said that although he had had discussions with Infratil and Waitakere City Council, "we don't see any necessity for our business to use Whenuapai".

Norris also used the conference to re-iterate Air New Zealand's expectations of a full-year pretax profit equal to or slightly better than last year's $220 million.

But it was far below what an airline with billions tied up in assets and capital costs should produce.

Air New Zealand should aim for a profit around 50 per cent up on that figure within a few years, whether the proposed alliance with Qantas went ahead or not.

But the scale and speed of losses incurred by events outside the airline's control, such as Sars, September 11 and war, was simply breathtaking, Norris said.

As a relative newcomer to the industry, "it has become clear to me that the airline business is unlike any other business on Earth and certainly not all in a positive sense. In many respects, the aviation business can at best be described as irrational".