Latest / Best of Business / Carrie Hurihanganui: Auckland Airport CEO on the airport reporting higher profits and revenue

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Carrie Hurihanganui: Auckland Airport CEO on the airport reporting higher profits and revenue · Best of Business

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  Speaker 1: You're listening to a podcast from News Talks'd be follow
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  Speaker 2: Auckland Airport has posted a steady half year result. Revenue
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  Speaker 2: is up four percent nearly five hundred and twenty million
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  Speaker 2: dollars and the dividend that will be paid out of
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  Speaker 2: six and a half cents. Chief executive Cuddy Hung and
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  Speaker 2: carry Hodi Hung and U joins us now Hi carry
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  Speaker 2: Hi Right, So two percent passenger growth is that good?
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  Speaker 3: Yes? It is pleasing, you know. I think the word
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  Speaker 3: I'd use is momentum is.
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  Speaker 2: Building building, So where do we want to get it to?
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  Speaker 3: Well, if we step back and look to say, if
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  Speaker 3: we look over the summer period, we did see a
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  Speaker 3: four percent increase incapacity, which is great, but still only
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  Speaker 3: sitting at not quite ninety five percent of twenty nineteen levels.
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  Speaker 3: And I'd love to stop referring to twenty nineteen as
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  Speaker 3: the comparative, but at this point it is still a
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  Speaker 3: good reference point. Understand how that recovery is progressing.
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  Speaker 2: Yeah, I mean we're still very much and catch up mode.
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  Speaker 2: How long do you reckon before we actually started clipsing
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  Speaker 2: that and get on the other side.
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  Speaker 3: Yeah, it's a great question. What we are seeing. Demand
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  Speaker 3: is certainly there. We're seeing percentage point five percentage point
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  Speaker 3: lift in December versus twenty nineteen on load factors, meaning
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  Speaker 3: that demand is upacing supply. You still have this global
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  Speaker 3: supply chain issue around jets, engines, et cetera that is
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  Speaker 3: subduing that. The flip side, though, is that is starting
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  Speaker 3: to wash through. You know, we were delighted to get
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  Speaker 3: Thai Airways announcement of returning to the market, and part
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  Speaker 3: of that is as they are getting additional fleet, they
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  Speaker 3: are they were able to return to New Zealand, which
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  Speaker 3: is great.
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  Speaker 2: How things going between yourselves and in New Zealand.
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  Speaker 3: I think certainly we've talked about this before. They're on
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  Speaker 3: an operational basis, we have day to day a lot
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  Speaker 3: of activity. They had a tough week the other week
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  Speaker 3: with a strike, and certainly we supported them with getting
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  Speaker 3: restarted out of that. So I think that's really strong.
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  Speaker 3: I think there's always points of difference when it comes
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  Speaker 3: to pricing every five years, and so that's not unexpected
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  Speaker 3: and one of the natural tensions that airports and airlines
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  Speaker 3: tend to have.
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  Speaker 2: I mean, and I feel as if it's not coincidence.
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  Speaker 2: What do you think that they've popped up at a
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  Speaker 2: Select committee on the day that you report to the
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  Speaker 2: markets and they're complaining about your pricing.
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  Speaker 3: Well, I don't know as far as the calendar of
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  Speaker 3: flux committees and when they are sat, but what I
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  Speaker 3: can say is upon airport, certainly we are focused on
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  Speaker 3: delivering capacity and resilience that New Zealanders are asking for,
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  Speaker 3: and I would encourage Air New Zealand to do the same.
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  Speaker 3: Our country needs a strong and growing national airline. But
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  Speaker 3: I also think contact is important and facts matter that
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  Speaker 3: airports are not and shouldn't be the scapegoats for some
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  Speaker 3: of the challenges that they've been experiencing.
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  Speaker 2: Do you think I mean, it seems to me the
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  Speaker 2: solution here in New Zealand's complaining says you're charging too much.
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  Speaker 2: You guys say you need the money for the renovation.
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  Speaker 2: Is there a middle ground here where maybe you just
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  Speaker 2: drop down slightly what you ask for?
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  Speaker 3: Well, I think there's a couple of things, and that
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  Speaker 3: how airports our user pays infrastructure we're regulated to ensure
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  Speaker 3: we chair charge fair prices. I think yesterday or the
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  Speaker 3: day before infrastructure comment Commission talked about actually network infrastructure
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  Speaker 3: should be funded by user pays. Really, again, I think
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  Speaker 3: we're mixing our drinks a little bit. When you look
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  Speaker 3: at airlines, the way they offer that and cost increases
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  Speaker 3: is growth. And when you look at Air New Zealand
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  Speaker 3: for a whole bunch of reasons, they have had challenges
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  Speaker 3: with not growing, but they're bucking the trend. Globally and regionally.
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  Speaker 3: Airlines are growing and that's how you manage your cost
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  Speaker 3: per unit, and so I think there's an element there
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  Speaker 3: that they need to look at is again, what are
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  Speaker 3: the reasons why their costs are increasing and their abilities
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  Speaker 3: to manage that. It isn't airports as the primary cause,
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  Speaker 3: you know. The second is we want them to grow too.
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  Speaker 3: Their position is hurting New Zealand and New Zealanders if
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  Speaker 3: they don't grow, So we want them to grow. But
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  Speaker 3: I do think questions should be asked more deeply about
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  Speaker 3: their cost base and their strategy, things like airfare monitoring
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  Speaker 3: and actually interrogating those elements. Airports are regulated and we
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  Speaker 3: have huge disclosure requirements, whereas for Air New Zealand we
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  Speaker 3: just need to believe what they say. There isn't any
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  Speaker 3: form of disclosure requirements or validation, and I think that's
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  Speaker 3: a starting point to understand kind of what some of
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  Speaker 3: the core issues are.
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  Speaker 2: Speaking of the renovation, how's it looking, because every time
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  Speaker 2: I go there, it looks bloody brilliant.
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  Speaker 3: Frankly, well, it's coming along, it's coming along. Well, actually,
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  Speaker 3: I mean we are on track to open it in
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  Speaker 3: twenty twenty nine. We've had some key milestones in this period,
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  Speaker 3: just pass that we reported on today, which is fantastic,
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  Speaker 3: and travelers will start to see that more directly as
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  Speaker 3: we start to transform the check in area from quarter
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  Speaker 3: two this year. Clearly, we will do everything possible to
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  Speaker 3: minimize the impact and it will be fabulous on the
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  Speaker 3: other side, but there is going to be a period
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  Speaker 3: of disruption that we certainly appreciate that.
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  Speaker 2: When is the other side, by the way, when do
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  Speaker 2: we get to see the new chick in experience?
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  Speaker 3: Oh, we'll all do because we don't want to reduce capacity,
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  Speaker 3: so we are taking in effect, we're renovating a zone
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  Speaker 3: at a time in the international check in area, and
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  Speaker 3: so that will take eighteen to twenty four months to
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  Speaker 3: kind of work through that so that we can maintain
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  Speaker 3: capacity throughout and ensure that travelers are having a seamless journey,
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  Speaker 3: so that will take up to twenty four months. And
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  Speaker 3: then I said we're on track for the integrated terminal
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  Speaker 3: to open in twenty twenty nine.
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  Speaker 2: Good stuff, looking forward to it, Carrie, Thanks very much,
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  Speaker 2: as always, Carrie, How to hung a new week Auckland Airport,
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  Speaker 2: Chief Executive.
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