Airports Association welcomes final pricing reports

THURSDAY, NOVEMBER 1, 2018

The New Zealand Airports Association (NZ Airports) has welcomed the final reports released today by the Commerce Commission into airport pricing at Christchurch and Auckland.

“Airports are subject to a robust regulatory regime which gives travellers assurance that airport charges are fair and reasonable”, said Kevin Ward, Chief Executive of NZ Airports.

“The Commission noted that there had been big improvements in the airport pricing regime, transparency had improved and that airport targeted returns had come down since its last report.

“We welcome the Commission’s finding that Christchurch Airport’s pricing is reasonable.

“The Commission stated in its report that Auckland Airport’s $1.8 billion infrastructure redevelopment will benefit consumers by reducing congestion and improving service quality.

“While acknowledging estimates of cost of capital are difficult, the Commission noted it was not persuaded that the full extent of target return is warranted. The Commission observed the amount in question is less than 50 cents per airfare.

“Airport charges only make up a very small portion of airfares. Kiwis pay $6-$12 for each domestic trip through an airport. Charges per international passenger range from $13 to $26. These modest charges cover all infrastructure that you see at each airport, including runways, taxiways, terminals, airbridges and, for international passengers, the space required for border processes.

“All three major airports have committed to hundreds of millions of dollars of investment in recent years to make sure the infrastructure meets rapidly growing demand.

“Without these modest airport charges, the high-quality services which travellers currently enjoy would suffer. Airports would not be able to make the investments needed to meet the needs of airlines and passengers and ensure an excellent travel experience.

“Christchurch and Auckland airports are now taking the time to consider the final pricing reports.”

ENDS

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