Greg Foran: Air New Zealand chief executive defends airline from criticism by Auckland Airport

Air New Zealand is brushing off criticism from Aotearoa's largest airport.

Auckland Airport CEO Carrie Hurihanganui has suggested the national carrier's too dominant in the domestic market, holding an 84 percent market share.

She stated Air New Zealand wasn't meeting the needs of consumers or the regions.

Its Chief Executive, Greg Foran says there've been adjustments in recent months - particularly Wellington - with declines in Government and corporate travel.

"But we know how important it is to be fair to everyone in New Zealand and ensure we've got connectivity."

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Episode Transcript

Speaker 1 (00:00):
Crayin Bridge Jenie Zealand's half year result out net profit
one hundred and six million dollars. That is down eighteen
percent on the same period last year. Engine issues. The
big problem for them, Greg four and is the chief executive.

Speaker 2 (00:12):
High, Greg Hi there, how are you right? Good?

Speaker 1 (00:15):
Thank you? How much worse? So obviously this is not
great for you? How much worse will it get in
the second half? Do you reckon?

Speaker 2 (00:23):
Look bit too early to call at this stage, but
we have said to the market that we do expect
it to be down on where we were in the
first half. But I would say, actually, I think this
is a really good result for the first half. You know,
when you consider what we're dealing with here, it has
been tough. It's a bit like you know, an all
Blacks team operating without the front row. You know, some

(00:45):
of these things are beyond our control. But I think
it's been a good performance. We haven't buckled and I
think our staff have really done a true terrific job
holding this thing together.

Speaker 1 (00:55):
This is the engine issues. How many how many planes
are you short? And how much do you reckon that's
taking off your bottom line?

Speaker 2 (01:04):
Well, we know actually that it's about one hundred and
thirty million dollars worth a headwind in that first half,
so you know, we calculate that we've got about ninety
million dollars worth of compensation. So it didn't cover everything
that we had to deal with, but it certainly helped.
And that's all part of the negotiation we have with
the engine guys. We had been down about you know,

(01:28):
seven to eight planes in the first half, but we're
predicting that's actually going to be around eleven in the
second half and then it should start to improve. And
you know this is all due to Rolls Royce and
Pratt and Whitney. It's a worldwide issue. It just happens
to be that, you know, we've got two of the

(01:48):
engine models that are problem about it.

Speaker 1 (01:51):
What about the performance? This is your on time performance.
September you were at eighty point four percent for on
time departures. Is that getting better or worse?

Speaker 2 (02:00):
It's been actually a real focus of ours. We weren't happy,
not just in September, we weren't particularly happy in November
and December, and neither were our customers. And I apologize
for that, but I can tell you we have really
nailed our performance since the beginning of the year and
on time performance has been over eighty percent for both

(02:21):
January and February. To date, cancelation rates has come right
down year to date just one point three percent, So
a real focus and once again credit to the team.

Speaker 1 (02:33):
In Ukland Airport having another crack at you. I mean,
this is like the perennial back and forth between you guys.
But they're saying today, they're saying that your market dominant,
you know, eighty four percent of the domestic market. You're
not meeting the needs of customers and regional communities. We've
got high prices, we've got fewer flights than the pre pandemic.
It's affecting tourism.

Speaker 2 (02:51):
What are you saying, I'd say a couple of things.
First of all, in terms of regional connectivity. You know,
back in twenty twelve, so just over deco decade ago,
we only had thirty four turboprops servicing regional New Zealand.
It's eighty hours and Q three hundreds. We now have
fifty three seem to be fifty four, so plenty of

(03:12):
extra flights in There have there been some adjustments, particularly
out of Wellington in the last few months as we
deal with a twenty five percent decline in government travel
and a decline in corporate travel. Of course you would
expect us to do that, but we know how important
it is to be fair to everyone in New Zealand
and ensure we've got connectivity. In The second point I

(03:34):
make is I don't want to get into the pointing
fingers that the stage My issue in terms of main
airports is around the regulatory settings. And you know that's
what I'm asking not just Auckland the airport. I'm asking
that you know, the government to look at and say
what is the responsible regulatory settings to ensure that infrastructure,

(03:57):
which is effectively operating in a monopoly type environment, gets spent.
We all know spend some money, but have some checks
and balances in there.

Speaker 1 (04:06):
We have ten seconds left if he's going to get
more expensive this half.

Speaker 2 (04:13):
What we're seeing is what we're seeing all around the country, Ryan,
and we're seeing less inflation a little bit still. What
I can tell you is we do our best to
hold them, but we are still seeing a little bit
of inflation, but certainly the rate of increase has decreased. Greg.

Speaker 1 (04:31):
Thank you very much, Thank you right it's Greig four
and he's the chef executive at in New Zealand. Just
gone fourteen minutes after five. So yeah, they are slightly
less twenty three million dollars less than what they made
in the same six months of last year, but still
a profit of more than one hundred million dollars Here
in New Zealand. For more from Heather Duplassy Allen Drive,
listen live to news talks it'd be from four pm weekdays,

(04:53):
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