Ports of Auckland withdraws lock-out notice

Ports of Auckland. Photo / Natalie Slade

Strike-troubled Ports of Auckland has cancelled plans to lock out its workers just a day after it lost a major shipping contract to a rival port.

The company announced this morning it had withdrawn a second lock out notice which involved more than half the company's employees and was due to take effect following a two-day strike planned for this Thursday.

Ports of Auckland chief executive Tony Gibson the decision had been made "in the interests of "our customers, the community and the wider Auckland business sector".

Gibson said the company had hoped to meet with the Maritime Union of New Zealand for further mediation today, but said the union could not meet until Friday.

"Not only does this show a disappointing lack of urgency on the union's part in seeking to resolve what is a very serious situation, it also suggests to us that they are determined to proceed with the strike," Gibson said.

The move by Ports of Auckland follows Maersk Line's announcement yesterday that it was moving its weekly Southern Star service to Port of Tauranga, wiping out nearly $20 million of revenue.

Maersk Line said industrial unrest had played a part in the decision.

Gibson said yesterday his worst fears had been realised by the decision.

"We had already warned the union that their strike action, during one of the busiest times in the shipping schedule, could cost Ports of Auckland a major customer and threaten jobs," Gibson said.

The port would lose 52 ship calls, 82,500 containers and nearly $20 million in annual revenue, which in the 2011 financial year was $177.2 million.

NZX-listed Port of Tauranga's shares closed up 26c yesterday at $10.07.

Port of Tauranga chief executive Mark Cairns said the announcement was great news.

"We have been working for some time to attract a new import ship call to Tauranga to better balance our MetroPort rail shuttle service to and from Auckland," Cairns said.

Maersk Line New Zealand trade and marketing manager Dave Gulik said the industrial unrest was a catalyst for the decision.

"It was a significant factor but it's not the only factor," Gulik said.

"The key thing for us is to be able to supply a stable, standalone product for our customers, for their customers and for their supply chain requirements.

"We are also looking at costs of course; the industrial action is expensive ... not only for the port, also for us."

There were no plans to move any other services from Auckland, he said.

"By no means are we pulling out of Auckland they're still a significant supplier for us."

There was always a chance the service could be moved back "to be entirely truthful".

"We've said we've moved it permanently and we're not planning to review the schedules at all at least until June next year.

"We expect cargo still to be available Monday morning, which is what it is when it calls in Auckland anyway."

First NZ Capital head of research Rob Bode said the permanence of the shift remained to be seen.

"It is a big loss (to Auckland) and it's a big gain for Tauranga if sustained. And that's the big if," he said.

Port of Tauranga had some advantages such as land holdings and competitive labour arrangements, he said.

"If Auckland can get their labour issues behind them and become very competitive, then things could swing back the other way."

New Zealand Shippers' Council chairman Greg Steed said the ports were close and it did not take much for a shipping line to switch.

Employers and Manufacturers Association chief executive Kim Campbell said Auckland importers and exporters could ill afford the extra time and cost of freighting goods to and from Tauranga or via other alternatives.

"Shifting more containers to and from Tauranga won't help our carbon footprint with unnecessary rail freight and more trucks on the road," Campbell said. "Longer lead times, and increased costs are not what we need."