Billie Moore: NZ Airports Association CEO says Air New Zealand needs regulation and pricing investigation

New Zealand's Airports Association has voiced disapproval with the latest review of their regulatory arrangements - and suggested the scrutiny needs to be on Air New Zealand.

MBIE has launched another review of airport regulations, just three weeks after the Commerce Commission gave Auckland Airport the tick of approval for an upgrade.

NZ Airports Association CEO Billie Moore says it's clear there's plenty of strain on the domestic market - and Air New Zealand has a 'monopoly' over that market.

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Episode Transcript

Speaker 1 (00:00):
Now MB has launched a review of airport regulation, just
three weeks after the Commerce Commission has given Auckland Airport
the tick of approval for its big upgrade. Now the
airport's association is upset that the scrutiny is on airports
yet again and not on Air New Zealand. And the
chief executive is Billy Moorehy, Billy.

Speaker 2 (00:16):
Ay, it's very good to talk to you.

Speaker 1 (00:18):
Why is MB looking at airport regulation again?

Speaker 2 (00:22):
Look, we're not sure. We're pretty disillusioned about it. I
think it was as as short as eleven days since
the last review before we heard about this one. We
looked at this a couple of years ago. With the
Civil Aviation Act went through in twenty twenty three, we
had an effectiveness to review a few years before that.
It feels like rolling reviews where airports come out really well,

(00:46):
and yet we continue to see a blind spot when
it comes to the monopoly that most consumers are experiencing
in aviation, which is their New Zealand itself.

Speaker 1 (00:55):
Okay, And when I'm getting to the Air New Zealand
thing with you in a tech because I am fascinated
by that as well. But is this looking at something
that is is this particular review looking at something that's
been looked at before or is it looking at something
completely new.

Speaker 2 (01:06):
It's a little bit unclear. It's a very loose review.
They're describing it as a check in on the system
and whether it's working the way it should. We think
the Commerce Commissioner has already exhausted that through the last
review of Auckland Airport, which was probably the biggest test
that it's had with the significant infrastructure investment that they've had.
But they're looking at whether the system needs to be

(01:26):
more flexible. We'll obviously submitted to that, like we always do,
try to be constructive, but we are getting a little
bit disillusioned with the fact that it's airports. Again. It
seems like the safe place for the government rather than
really looking at the overall system and what's affecting it.

Speaker 1 (01:42):
Fas Okay, now, what do you want them to look at?
This is the government. What do you want them to
look at? Rear New Zealand.

Speaker 2 (01:47):
Look, we want to look at the domestic market. We
can see that there is a lot of strain on
the domestic market. It's in decline at this point. The
health of the market is really really poor. We've lost
one point five million seats out of the system since
twenty nineteen. So in contrast with the rest of the world,
our system is not growing. Aviation is going gangbusters offshore

(02:11):
and we're not seeing that same growth in New Zealand.
And part of that, a really significant part of that
is because we have one operator. Air New Zealand's great.
I work with them closely. They're excellent people, but they
are one business and they've had some really bad luck.
They also have eighty percent of their roots as monopoly
roots in the regions and listeners will experience that when

(02:34):
they're booking their flights every day. We need more competition
in that system. Ultimately, that's what affects early is Look,
we can't force competition, but we have to deal with
the consumer outcomes. If competition isn't possible, and that's essentially
what Air New Zealand argues. They think that the population
scale is too low for more competition. If more competition

(02:55):
isn't possible, then regulation needs to follow. That's what we
do with most other virtual monopolies, like transpower, like Chorus.
That's what happens. There's some kind of oversight the market
power of those things. Yes, so there has to be
some kind of action regardless of the decision you make
about whether competition is possible or not.

Speaker 1 (03:15):
Okay, hey, Billy, thanks for talking us. I really appreciate it.
Billy Moore, chief executive of the Airport's Association. For more
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