KEY POINTS:
A slow start to the tourist season hasn't put a dampener on Auckland Airport's plans for a $180 million expansion of its international terminal.
The airport, under fire from some airlines for pushing through what they say is an unnecessary upgrade, is sticking by its prediction that international and domestic passenger numbers will increase by 4 or 5 per cent every year until 2012.
Figures from early in the tourist season show short-term visitor numbers dropped slightly in October and November last year, with October arrivals down 3.6 per cent and November arrivals down 0.5 per cent on 2006. Overall, visitor numbers for the year ending November 2007 were up on 2006, increasing by 2 per cent, or 57,900 visitors, on the previous year.
Airport chief executive Don Huse said that the summer had got off to good start, with the airport working with airlines, aviation security, customs and immigration to ensure the summer surge in travellers was managed smoothly.
He said when it came to infrastructure investment, such as the terminal expansion, it was important to take a long-term view. "[It] takes years to plan and deliver. It cannot be turned on and off like a tap."
Huse said the upgrade, which should be finished by mid-2011, would relieve passenger congestion in international arrivals, as well as helping the airport compete with its peers in Australia, Asia and North America.
It will take the baggage hall, customs and biosecurity secondary screening area, and the arrivals concourse up to a newly developed first floor. More space will be available for immigration, quarantine and customs secondary processing, meaning more travellers will be able to be processed more quickly.
The planned upgrade has caused grumbling among airlines, which are pressuring the airport to delay plans until after the 2011 Rugby World Cup.
Last week, an Otago University study showed greenhouse gas emissions generated by visitors' air travel to New Zealand were much greater than commonly thought, fuelling suggestions international mass-tourism might be at risk, as Northern Hemisphere travellers looked at the carbon footprint caused by flying long distances.
An industry insider, who did not want to be named, also said record high oil prices would cause concern for air travellers.
But Huse said the airport's prediction that passenger numbers would increase between 4.5 and 5 per cent each year until 2012 was in line with Government tourism projections.
He said the increase could be higher given the economic growth in the Asia-Pacific region and the high number of aircraft orders by international airlines operating in the region.
Plans to upgrade the international terminal follow completion of a $42m upgrade to the domestic terminal in December.
Future plans for the airport include a second runway, better transport links with Manukau and Auckland cities, at least two hotels and other commercial and retail development. Construction of the second runway is due to start by 2010.
However, expansion plans may be up for debate once more if the airport is sold.
The airport weathered two takeover attempts put forward by overseas companies last year.
Dubai Aerospace Enterprise pulled out of a bid for between 51 and 60 per cent of the airport in September, while shareholders are now considering a second offer by Canadian Pension Plan Investment Board for 39.53 per cent of the airport.
The partial takeover, which airport directors have advised shareholders to reject, would take the Canadians' stake to 40 per cent and could pave the way for a more aggressive expansion plan, including working with airlines to boost traveller numbers.
A third overseas company may also be in the running.
Last month, the airport announced that it had been approached by an unnamed but "credible" international alternative to the Canadians. Market speculation has so far focused on Australia's Macquarie Bank.
