An Emirates A380 lands at Auckland Airport. In the past two years, the runway has been closed at short notice for 15 minutes or more four times. Photo / Dean Purcell
An Emirates A380 lands at Auckland Airport. In the past two years, the runway has been closed at short notice for 15 minutes or more four times. Photo / Dean Purcell
EDITORIAL
For big infrastructure companies, it's the putting right that counts when things go wrong.
They inevitably do.
Auckland International Airport suffered two runway closures in quick succession earlier this year. Now, in a review finished quicker than planned, it concedes patching the tarmac took too long.
The company isone of New Zealand's largest and, as the main aviation gateway for international passengers and freight, plays a vital cog in economic performance. Some 21 million international and domestic passengers pass through it a year.
In the past two years, it has shut its runway at short notice for 15 minutes or more four times, but two recent closures in quick succession disrupted thousands of passengers, cost airlines hundreds of thousands of dollars and resulted in a global alert from pilots.
While the airport was reticent on details at the time, pilots say the landing zone had deteriorated more quickly than anticipated.
The airport review found its response time to patching the tarmac was too slow. Workers for the company with a market capitalisation of more than $10 billion didn't have access to the right tools or they were too far away from the problem.
The airport now assures users it has a new inspection regime and will respond to incidents more rapidly.
The number of times the runway is inspected daily will be doubled.
But a start on replacing concrete slabs where problems have occurred is not planned until September.
Focus on the runway comes as the company today reports results from the past six months, which are forecast to be flat.
Before the coronavirus outbreak growth had decelerated visits, there were several years of near double-digit visitor growth around the middle of the decade. But no more. The tourism boom has eased and arrivals have levelled off, as have forecasts for its profit for the past six months.
Interim profit could fall by 0.8 per cent to $135.9m.
Fallout from the Covid-19 coronavirus outbreak is predicted to deliver a sharp and, hopefully, short shock to the aviation and tourism sector and the airport's full year profit will likely be affected.
Advice on the novel coronavirus being provided to arrivals at Auckland International Airport. Photo / Supplied
Only about 8 per cent of seat capacity into the airport originates in China but the number of total flights has plummeted as travel restrictions and a collapse in demand bites.
The company is popular with small shareholders - close to 40,000 have fewer than 5000 shares - and every Auckland City ratepayer has a stake through the council's 23 per cent shareholding.
It is a monopoly, held aloft in an aviation boom; diversifying and handsomely rewarding shareholders with dividends through its policy of paying out 100 per cent of underlying profits.
Its chief executive, Adrian Littlewood, rejects claims it is not investing enough in what has traditionally been its core business - running an airfield.
Repair work being carried out on the main runway at Auckland International Airport. Photo / Philip Wardale
The airport board charter includes a requirement for Littlewood to adequately maintain and protect its assets.
Yesterday he said the runway was the airport's key asset. In the face of criticism, the company has been prioritising other more lucrative parts of the business. This was a welcome assurance. Now it's a matter of doing any patch-ups needed in a timely manner.
