Jetstar boost highlights poor leadership

Published HBT 23 April 2016

After a decade of near stagnation passenger numbers through Hawke’s Bay Airport for the 6 months to December 31 increased by 13.5%, (HBT 5/04/2015) possibly the most significant performance improvement in the entire history of the airport. 

Whilst this included just one month of Jetstar operations their pending arrival in provincial New Zealand had been announced way back in June, so Air New Zealand had plenty of time to take action to preempt the increased competition. 

It seems certain passenger numbers will exceed half a million by the end of this financial year, (June 30) and as most of the 135 000 additional Jetstar seats between Napier and Auckland will only become available in the second half of the financial year, it seems likely passenger numbers could reach 600 000 by Christmas this year, at least 3 years ahead of the airports own projections.  

Whilst it’s great the airport is financially viable thereby lessoning the risk of needing council and crown support, the primary purpose of the airport is not to make money but to facilitate essential air links with the rest of New Zealand and the rest of the world. Without these links our businesses would be seriously disadvantaged, our visitor industry much reduced, and Hawke’s Bay would be a much less desirable place in which to live, as has been the case for far too long. 

Airport management tells us business travellers make up an astonishing half of all passengers, proof if any is needed that we have been subject to some very unreasonable treatment from the national carrier. Antidotal evidence suggests there has now been a significant correction since Jetstar arrived on the scene.  For far too long those visiting friends and family and tourists have been deterred from coming here by excessive airfares. Suddenly these people can afford to fly, often for the first time in their lives.  Businesses are also able to visit their clients and suppliers more often and more affordably.  

Yes Hawke’s Bay is on a roll and the increase in passenger numbers through the airport is evidence we may have turned a corner. However the reality is we could have been in this situation many years ago had our MP’s, Mayors, Councillors and the Airport Board committed to getting competition and better air services rather than just paying lip service. It needs to be said our leaders did nothing to get Jetstar here, despite their endless efforts to gain a share of the glory. Perhaps if they had declined a few Air New Zealand lunches and had instead tackled the airline’s management over their service levels things might have been different. 

For years these naysayers claimed it would require over $10 million of runway and terminal  improvements to get another airline. Strangely the Napier council was quite happy to spend $18 million on the museum upgrade catering for fewer than 40 000 paying visitors plus $2 million for a couple of reconditioned buses that managed just one passenger per trip. Hastings also had a $15 million spend up on the Opera House that attracted just 60 000 customers, and now needs a further $10 million for earthquake strengthening.  At the same time the the airport board spent $5 million developing a business park which attracted just one tenant and has already taken a near million dollar impairment charge.

Now Napier plans to spend a further $15 million on a velodrome whilst Hastings intends spending untold millions on Civic Square, a hotel and other projects, none of which will provide any significant economic benefit, or provide for more than a tiny fraction of the 600 000 people expected to pass through the airport this year. Additionally these dreams all require substantial ongoing ratepayer support, unlike the airport which actually makes money and plays the council owners a dividend.    

Good times never last forever and we need to be proactive in seeking ways to sustain the growth we are now experiencing.  We have finally got competition and look at the difference it is making. We now need Jetstar to start flying south to Wellington and/or Christchurch. We need larger more traveller attractive A320 pure jets linking us with Auckland, and we need to get direct flights to Australia. All of which we might have achieved years ago if those charged with making a difference had actually made a difference. 

Our so called leaders have been too willing to accept Air New Zealand claims they were meeting our needs. The 135 000 additional seats now being provided by Jetstar, (plus another 29 500 from Air New Zealand) in the space of just one year is clear proof of  how seriously wrong they have been all along. It is time to replace the negative thinkers who seem control so much of Hawke’s Bay with people of vision, appropriate expertise and proven performance. 

Arrival of Jetstar not thanks to visionless leaders

Published HBT 27 Feb 2016

My recent talking point headlined  “tourism expensive for ratepayers”  in response to a request by Tourism Hawke’s Bay for a further $900 000 of ratepayer funding may have given the impression I was hostile to the visitor industry. Nothing could be further from reality. 

I consider the visitor industry to be a vital part of our local economy and my commitment to this sector includes two years on the board of Wine Country Tourism an organisation funded solely by its members not ratepayers, plus for the past 12 years I have battled against the inexplicable resistance of our civic leaders towards better air services. Whilst these individuals are now clambering for recognition they deserve no credit. 

Thank goodness Jetstar have arrived, not because of the actions of our leaders, but because it was apparent to the airline that Hawke’s Bay offered the best opportunity for additional passengers. Why else would we and Nelson be the first to receive the new services and the only places to get four daily return flights to Auckland? The reality is the 50 seat Q300 Bombardier aircraft being used became surplus to Qantas/Jetstar needs following the severe down turn in demand transporting fly in/ fly out mine workers in Australia. 

Their four new daily return flights have added 20% or 135 000 additional seats annually between Napier and Auckland. This is more than 4 times the increase promised by Air New Zealand at a recent parliamentary select committee hearing. That all flights still seem full despite this huge increase in capacity is surely proof that Air New Zealand have been under providing seats at affordable prices for a very long time. 

Some of these new passengers will be first time flyers, some will be Hawke’s Bay people on business or visiting friends and family. Perhaps half will be visitors bringing money into our region to spend on accommodation, food, retail and elsewhere. If each spends just $500, our economy will be better off to the tune of $20 million a year . 

Of course had the former Mayor of Napier Barbara Arnott and current Hastings Mayor Lawrence Yule not created so many impediments we might have built the runway necessary to attract either Qantas/Jetstar or Virgin Blue many years ago. Others were also unhelpful but it was our community leaders who demonstrated the greatest lack of vision. The proof of how poorly they understood the need is that Jetstar have added 135 000 extra seats and Air New Zealand are promising 29 500 more seats in the space of just one year. 

Whilst showing so little enthusiasm for better air services the Mayor of Napier was championing an $18 million museum extension that is attracting just 38 000 visitors annually, actually less than the older smaller museum, plus supporting a $2 million spend on the now failed Art Deco bus venture that struggled to attract a single passenger per trip. At the same time the Mayor of Hastings was spending $15 million upgrading the Opera House and Municipal Buildings which now need a further $10 million for earthquake strengthening for the Opera House alone and $6 - 8 million for the Municipal Buildings. All for just 60 000 patrons a year.    

Interestingly whilst Tourism Hawke’s Bay has been highly visible since Jetstar first announced they might fly into Hawke’s Bay I cannot remember them previously commenting about high airfares, lack of competition, or the need for better air services. 

Despite the clear benefits arising from Jetstar’s arrival, rather than committing to further improvements in our air connections Napier now wants to spend $15 - 25 million building a Velodrome whilst the Hastings council is promoting Tehei Heretaunga a $40 million spend up that will do little to improve the local economy. Unlike the airport both will need significant ongoing ratepayer support. 

It’s pleasing to see Air New Zealand scheduling an additional12 flights in the two days prior to the International Marathon in May, plus a similar number in the two days following the event. Interestingly there is no evidence of increased capacity being provided for for Art Deco, Horse of the Year, the Festival of Hockey or any other event. Of course as sponsor of the Marathon Air New Zealand would hardly want to see people having to use Jetstar because of lack of seats.  

Right now tourism is booming. Over 30 000 visitors arrived for Art Deco and no vacancy signs are becoming the norm. But let us be honest the whole country is on a roll and we are simply being dragged along for the ride. At the end of every upswing is a downturn and we need a plan to create continued growth to ensure we are still doing well when the inevitable happens.  

Competition is a wonderful thing as Jetstar have already proved. It is time for those who are tying to claim credit for having already bought Jetstar here such as our Mayors, Councillors, business and tourism heads to demonstrate real vision and take what ever steps are necessary to get Jetstar to also link Napier to Wellington and Christchurch. 

Instead of more flights to Auckland we need improve our image and upgrade to pure jets. 

Then we need to go for the jackpot, direct flights to Australia.

Air New Zealand should disclose details

Published  4 Feb 2016 

The Air New Zealand PR machine wound up again last week during a parliamentary select committee hearing. In response to Napier MP Stuart Nash telling airline boss Christopher Luxon that “the biggest barrier to doing business in Hawke’s Bay was the price of airfares”, Mr Luxon responded by claiming the airline was adding an additional 29 500 seats to Hawke’s Bay services this year. This is less than a 5% increase or just one daily return service using the airlines smallest aircraft the Bombardier Q300 or just five return flights a week on the larger ATR 72. Interestingly at the same time the airline announced an additional 100 000 seats between Auckland and Queenstown.   

He did not reveal the division of the extra seats over the 3 existing Hawke’s Bay destinations so it is unclear how exactly these extra seats will be provided and whether there will be any improvement on Wellington or especially Christchurch services where prices still seem very high and ground alternatives unappealing. Probably few people realise that 29 500 seats is actually less than one quarter the135 000 additional seats now being provided by Jetstar’s 4 daily return flights between Napier and Auckland. Air New Zealand may have the lions share of local passengers but it is Jetstar who are providing most of the growth. 

Checking Air New Zealand’s forward schedule reveal no significant change in either the frequency or the mix of aircraft on Hawke’s Bay services for the rest of the year. Perhaps the increase has already been implemented as a result of the change from 50 seat Q300 aircraft to the larger 68 seat ATR 72 on most Auckland flights. The airline should now be required to specify exactly how these extra seats will be provided if only to ensure services are improved. 

Thank you Stuart Nash for bringing this issue up in the formal environment of a parliamentary select committee. 

Published HBT 23 April 2016

After a decade of near stagnation passenger numbers through Hawke’s Bay Airport for the 6 months to December 31 increased by 13.5%, (HBT 5/04/2015) possibly the most significant performance improvement in the entire history of the airport. 

Whilst this included just one month of Jetstar operations their pending arrival in provincial New Zealand had been announced way back in June, so Air New Zealand had plenty of time to take action to preempt the increased competition. 

It seems certain passenger numbers will exceed half a million by the end of this financial year, (June 30) and as most of the 135 000 additional Jetstar seats between Napier and Auckland will only become available in the second half of the financial year, it seems likely passenger numbers could reach 600 000 by Christmas this year, at least 3 years ahead of the airports own projections.  

Whilst it’s great the airport is financially viable thereby lessoning the risk of needing council and crown support, the primary purpose of the airport is not to make money but to facilitate essential air links with the rest of New Zealand and the rest of the world. Without these links our businesses would be seriously disadvantaged, our visitor industry much reduced, and Hawke’s Bay would be a much less desirable place in which to live, as has been the case for far too long. 

Airport management tells us business travellers make up an astonishing half of all passengers, proof if any is needed that we have been subject to some very unreasonable treatment from the national carrier. Antidotal evidence suggests there has now been a significant correction since Jetstar arrived on the scene.  For far too long those visiting friends and family and tourists have been deterred from coming here by excessive airfares. Suddenly these people can afford to fly, often for the first time in their lives.  Businesses are also able to visit their clients and suppliers more often and more affordably.  

Yes Hawke’s Bay is on a roll and the increase in passenger numbers through the airport is evidence we may have turned a corner. However the reality is we could have been in this situation many years ago had our MP’s, Mayors, Councillors and the Airport Board committed to getting competition and better air services rather than just paying lip service. It needs to be said our leaders did nothing to get Jetstar here, despite their endless efforts to gain a share of the glory. Perhaps if they had declined a few Air New Zealand lunches and had instead tackled the airline’s management over their service levels things might have been different. 

For years these naysayers claimed it would require over $10 million of runway and terminal  improvements to get another airline. Strangely the Napier council was quite happy to spend $18 million on the museum upgrade catering for fewer than 40 000 paying visitors plus $2 million for a couple of reconditioned buses that managed just one passenger per trip. Hastings also had a $15 million spend up on the Opera House that attracted just 60 000 customers, and now needs a further $10 million for earthquake strengthening.  At the same time the the airport board spent $5 million developing a business park which attracted just one tenant and has already taken a near million dollar impairment charge.

Now Napier plans to spend a further $15 million on a velodrome whilst Hastings intends spending untold millions on Civic Square, a hotel and other projects, none of which will provide any significant economic benefit, or provide for more than a tiny fraction of the 600 000 people expected to pass through the airport this year. Additionally these dreams all require substantial ongoing ratepayer support, unlike the airport which actually makes money and plays the council owners a dividend.    

Good times never last forever and we need to be proactive in seeking ways to sustain the growth we are now experiencing.  We have finally got competition and look at the difference it is making. We now need Jetstar to start flying south to Wellington and/or Christchurch. We need larger more traveller attractive A320 pure jets linking us with Auckland, and we need to get direct flights to Australia. All of which we might have achieved years ago if those charged with making a difference had actually made a difference. 

Our so called leaders have been too willing to accept Air New Zealand claims they were meeting our needs. The 135 000 additional seats now being provided by Jetstar, (plus another 29 500 from Air New Zealand) in the space of just one year is clear proof of  how seriously wrong they have been all along. It is time to replace the negative thinkers who seem control so much of Hawke’s Bay with people of vision, appropriate expertise and proven performance.