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Expansion plans for Auckland
By Andreas Spaeth
It is a long way from Europe to Auckland – 18,200 kilometre from London. If one travels via Hong Kong, the pure flying time is 21 hours, but the return flight against the wind takes almost 24 hours. One could hardly find a longer distance from A to B on the globe. The first thing that strikes the eye as one looks out of the aircraft window during the approach to landing is the rich green and deep blue – lush meadows as far as the horizon, interspersed with sea inlets and coastal landscape. Then the city centre of Auckland floats by on the left, and just minutes later the final approach to a runway which juts out halfway into the sea. We have arrived in Auckland International Airport close to the town of Mangere.
Depending on the time of arrival, the airport can appear at first glance to be nice and comfortable, no trace of the hectic activity that one finds in a mega-hub like London Heathrow, where our journey began. But this is New Zealand, a small country somewhat larger than the former West Germany. Its population is not much more than four million, although there are nearly 70 million sheep. Yet the first impression gained during the morning is deceptive. In the middle of the day a crush develops in the terminals and on the ramp. Naturally the local matador, Air New Zealand (see FLUG REVUE 1/2007), is the predominant force here, accounting for over half the flight movements, but virtually all the big Asiatic airlines, such as Qantas and especially Emirates are represented here. Emirates in fact has no fewer than three wide-body jets in Auckland at virtually the same time in the middle of the day.
The expansive airline from Dubai is apparently the darling of airport director Don Huse, CEO of the operating company, Auckland International Airport Limited (AIAL), which was privatised in 1998. From the conference room in which the interview with FLUG REVUE is taking place, one has a view out to the ramp where all three Emirates jets are currently parked.
“We are very pleased with Emirates, which first landed here in August 2003 – just at the time when the SARS crisis hit us,” Huse recalls. Emirates uses New Zealand's geographic location close to Australia to make money instead of paying expensive parking charges “down under”. As Don Huse explains, “Especially in Sydney, it is really expensive to park an aircraft in Australia.” Instead, Emirates takes all its flights from Dubai via Australia (Sydney, Melbourne and Brisbane) the approximately three hours extra to fly on to Auckland and only returns to Australia in the evening at the ideal departure time. From there the planes fly back to Dubai. In so doing, Emirates is one of no fewer than eight airlines which currently fly across the Tasman Sea between Australia and New Zealand. This ensures that virtually no one makes any money here.
Whereas for airlines which rely heavily on local business, such as Air New Zealand, this can be a matter of necessity (the flag carrier is set to reduce its trans-Tasman services by 11 percent in April, although not from Auckland), for Aerolineas Argentinas, Emirates, Lan, Qantas or Royal Brunei the extra leg added to a long-haul flight is a useful way of generating extra revenue.
As soon as the yield from and to New Zealand is big enough, many airlines split their services, as Thai Airways recently did, for example: it now flies non-stop from Bangkok to Auckland. Altogether there are 31 non-stop foreign destinations available from Auckland. Seven of them are in Australia, nine in the South Pacific Islands, three in the USA (including Hawaii), two in South America (Buenos Aires and Santiago de Chile) and nine in south-east Asia. These destinations are served by no fewer than 18 airlines which make regular landings. Not a single one of these comes from Europe any more since British Airways transferred its Auckland services to a Qantas codesharing operation.
Lufthansa Cargo, too, withdrew from Auckland a few years ago; the periodic intermediate stop on the round-the-world cargo route flown with the MD-11 used to take in the cities of Frankfurt, Chicago, Los Angeles, Honolulu, Auckland, Melbourne, Kuala Lumpur, Bangkok and Sharjah, before returning to Frankfurt.
When one considers New Zealand's remote peripheral location and low population density, the growth which has occurred in Auckland's international passenger traffic is very impressive. “We are the second biggest international airport in Australasia after Sydney,” says Don Huse proudly. Auckland handles 72 percent of all international passengers who visit New Zealand, whereas Christchurch on South Island offers tourism-motivated seasonal flights to Asia, while Wellington, the capital city, and many smaller airports operate direct trans-Tasman services to Australia. Altogether, New Zealand has eight airports capable of handling aircraft of the size of a Boeing 737-300.
Compared with Auckland, Sydney handles only 50 percent of international departures and arrivals in Australia, and only one-third of its business involves international flights. In Auckland, on the other hand, 60 percent of the 11.4 million passengers processed last year were travelling across the border.
Due above all to the buoyant state of tourism, which is the biggest industrial sector and most important source of income of the country, airport operator AIAL expects to increase the volume of international traffic by four percent per year. “The number of Asian immigrants to New Zealand is increasing sharply, stimulating further traffic growth,” says Huse. Air New Zealand has already announced that it will open one new international route a year. Moreover, Huse predicts, “We are also expecting expansion from Emirates and Qantas.” Whereas Qantas already flies non-stop from Auckland to the US West Coast thanks to the completely liberalised air transport market between Australia and New Zealand, Emirates too is assumed to have ambitions to fly this route, even though this will raise difficult traffic law issues.
When one considers that the city of Auckland and surroundings have 1.3 million inhabitants yet the entire population of New Zealand is only 4 million, the volume of traffic handled by the airport is already remarkable today. Auckland airport alone handles nearly three times as many passengers as the entire domestic population of the country.
Equally impressive is its historical growth. When the airport was officially opened in 1966, only half a million people lived in Auckland, the national population stood at two million and the airport handled 260,000 passengers in its first year of operation. By 1972 it had broken through the million mark to 1.3 million, and by 1979 passenger traffic had almost doubled again to over 2.5 million passengers. Twelve years later, in 1991, the airport's 25th year of operation, the number of users had doubled again to five million. Today, an average of 30,000 passengers land every day on 106 international and 335 domestic flights. Within a period of ten years, the number of domestic passengers has risen sharply from just under three million in 1995 to almost five million in 2005.
The domestic flights, 80 percent of which are operated by Air New Zealand and subsidiaries plus, on a few major routes, Qantas (which took over its routes from Ansett NZ), link a total of 19 locations to Auckland non-stop. Domestic services account for 76 percent of all flight movements, a fact which at first sight appears astonishing in such a straightforward country.
Due to the low population density, New Zealand does not have a close-meshed network of traffic connections: there is no efficient railway system nor are there any motorways or express roads. A 330+ kilometre trip from the Bay of Islands, beloved by tourists and situated to the north of Auckland, to Rotorua, home of the hot thermal springs, both of them located on North Island, can easily take 14 hours by road, so air transport offers the only alternative, especially when it comes to travel between North Island and South Island.
This means, however, that modernisation of the Air New Zealand domestic terminal in Auckland, which at present is a somewhat uninviting prospect for travellers, is all the more urgent. Originally built as a cargo terminal in the mid-1960s, it then became a passenger terminal, initially for both domestic and international flights. The situation relaxed with the opening of additional terminals in 1977 and 1987, but, as the operators admit today, “Ever since it was opened, the terminal was inadequate, with congested concourses and no air-conditioning.” In a modernisation campaign referred to as an “extreme makeover”, a modern and efficient environment for domestic traffic is now to be created by the end of 2007. “In about ten years' time we will then build a completely new domestic terminal in the north under the expansion master plan,” Don Huse announces.
After the rebuilding work to accommodate domestic passengers has been completed and the international terminal extended to the west, both by December 2007, “For the first time we will not have any capacity problems for the next five years,” according to Huse. Here the airport will also profit from its past for the next few decades. “To this day the fact that the airport was built on green meadow land is wonderful,” says Huse. “Land is still cheap here and so far urbanisation has not advanced as far as the airport boundaries.” Ideal preconditions for further expansion.
There is no prohibition on night-time flying, and ten percent of flights, especially to the USA and to Europe via Asia, depart between 10pm and 1am. Although the almost rural location by the water is useful here, for passengers it is often annoying. Auckland must be one of the few hub airports in the world which not only has no efficient public transport link to the city centre, preferably by rail, but it does not even have adequate road access to the city centre 21 kilometre away. There is a small stretch of motorway on the way to the city, but the rest of the route is via busy, narrow main through-roads and takes 45 minutes or more. “During the rush hour, the route to the city can be congested,” admits even Don Huse, “But by 2015 we intend to have a motorway link to the city.”
Such issues evidently did not enter into consideration when the airport was originally planned. It was in 1955 that the decision was taken to expand Mangere airport, first opened in 1937 and used by the Auckland Aero Club, into the new international airport. Funding of the new construction project was finally settled in October 1960 and the preliminary construction work near Mangere began. To avoid using valuable farmland, about one half of the initially 2,590 metre runway was built into the water of the natural harbour of Manukaua. The preliminary work lasted three years, and about one-tenth of the airport's present 1,500 hectare area consists of reclaimed land.
After five years' total construction time, on 20 July 1965 the first jet aircraft landed at the new airport – an Air New Zealand DC-8 on its delivery flight from McDonnell Douglas in Long Beach. At the same time the landing coincided with commissioning of the new Air New Zealand base with hangar, maintenance operation, training and catering complex.
However, the official opening date, which was marked by three days of celebrations, was taken to be 29 January 1966. At that time the new airport was used by BOAC (today British Airways), Canadian Pacific (today Air Canada), UTA (today Air France) and Pan Am plus two other domestic airlines which have long since disappeared, as well as by Air New Zealand and Qantas. It was not until 1977 that significant extra space was added, with the opening of the then biggest public building in New Zealand, the Jean Batten International Terminal, covering an area of 3.6 hectares.
As the volume of traffic grew steadily, extra areas were added to the international terminal in 1993, 1997, 2001 and 2005, and the last enlargement for the time being is currently under way. Today a maximum of 2,000 international passengers can be handled per hour, and the modernised building is also equipped to handle the A380. Emirates is expected to be the first A380 operator to fly to Auckland. The recently opened new departures area on the air side is particularly impressive on account of its generous size, transparency and wide selection of catering and retail outlets in a modern ambience, which was previously sorely lacking.
Some 80 out of the total of 100 shops at the airport are located in the Jean Batten Terminal and make a significant contribution to the approx. 60 percent of revenues of the operators which are generated by non-aviation activities. AIAL, whose shares are traded on the Auckland stock exchange, where it is ranked in fourth place by market value, is extremely profitable, having achieved a post-tax profit of about Euro 50 million in 2005/2006. But this is where the users come in: passengers departing on international flights always have to pay an airport charge of 25 New Zealand dollars (about Euro 12) in cash prior to takeoff, a tax which even in airport circles is viewed as an “anachronism”. The IATA describes the exorbitantly high airport profits in Auckland and the airline charges on which it is based as “a clear example of the misuse of the monopoly position of an airport” and has officially requested information about AIAL's business charges from the New Zealand government.
The latter, however, is more interested in the long-term growth and expansion of its lucrative airport. According to the master plan, “By 2025 we will be handling 15.3 million international and 8.6 million domestic passengers per year, a total of 24 million passengers annually.” Already by 2010/2011 there are plans to build the first expansion phase of a new runway to the north of the existing airport grounds.
Initially it will only be 1,200 metres long, and will not be connected to the present ramp area by taxiways. In a kind of insular operation, a small, separate terminal which will handle local turboprop flights without transit passengers is to be built on the north side. Little by little this initial solution will then be expanded into the new domestic terminal of the airport and connected to the existing facilities on the south side. Eventually the northern runway will be 2,150 metres long and primarily handle smaller aircraft up to the size of a Boeing 737/Airbus A320. This will also create more space for wide-body jets and long-haul flights on the southern runway, which today is already 3,635 metres long. Once the expansion work is over it should then be possible by the year 2025 to handle up to 51 take-offs and landings per hour at peak times instead of the present 40 flight movements per hour and to process up to 6,900 passengers instead of the present 2,800.
From FLUG REVUE 3/2007
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