"New Zealand airport privatisation 'fails'"

Saturday, August 9, 2003

NZ airport privatisation 'fails'
New Zealand - The Christchurch Press


Airport privatisation in New Zealand has failed and the Government must step
in to curb massive fee increases to airlines, International Air
Transportation Association (IATA) director general Giovanni Bisignani says.

At a meeting with Transport Minister Paul Swain yesterday, he called for the
Airport Authority Act to be reviewed. "We are not against privatisation,
because privatisation brings efficiencies.

"Unfortunately we have seen in the last years that every experiment with
privatisation has not been successful if it is not accompanied by a new
regulatory body or authority ... to avoid airports taking advantage of their
monopoly position."

Mr Bisignani was especially critical of Wellington International Airport's
78 per cent fee increase to airlines, not accepting the airport's argument
that the increase was necessary to make a return on the new $16 million
terminal. Airlines could not increase prices 78% if they bought new
aircraft, he said. "Privatisation of airports (in New Zealand) had not been
successful."

But Mr Bisignani lauded air traffic control service provider Airways
Corporation as world leading in its approach to charges and dealing with
airlines. Airways was in April recognised by the association as among the
best in the world, he said.

"They have understood that partnership is important. They have made
efficiencies, decreased costs, and are sharing those with the airlines."
This approach could allow Airways to take advantage of future global
consolidation among the 180 air traffic control providers.

Airways has been able to hold prices since the September 2001's terrorist
attacks, after restructuring the business five years ago.


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