New Zealand's airports hit back over 'excessive profits' claims

The CEO of NZ Airports claims lobbyists were spreading 'false and misleading information'. Photo / Grant Bradley

New Zealand's airports have hit back at claims they have chased "excessive profits".

The New Zealand Airport Association has accused an airline lobby group of trying to confuse the public and ignoring investment in airport infrastructure.

The squabble follow Australasian group, Airlines for Australia and New Zealand (A4ANZ), alleging that Auckland Airport had claimed "excessive profits" of $3.6 billion over the past two decades.

Chief executive of NZ Airports, Kevin Ward, claimed airline lobbyists were spreading "false and misleading information about airport regulatory and commercial models".

"Air New Zealand and Australian-based A4ANZ's claims that Auckland Airport earned excess returns of $3.6 billion over the last twenty years...would not pass any basic evidential test under the NZ regulatory regime.

"The airport's total aeronautical revenues (landing and passenger charges) over that period was approximately $3.2 billion – less than their so-called 'excess' – suggesting they want to land for free. Australian-based A4ANZ's commissioned advice from Frontier Economics in Melbourne doesn't explain the basis of its analysis, but it is clearly flawed.

"I also don't understand the claim that airlines and the public are paying more than they should. Analysis of airport margins in NZ shows that they operate very efficiently and, because of that they pass on lower operating expenses to customers than other airports (e.g. staff costs, consultancy, insurance, energy etc) with most charges going towards covering depreciation costs on infrastructure investment, tax and a closely monitored regulated return on their investment." ​