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Airline and airport kiss and make up

By Phil Boeyen, ShareChat Business News Editor

Thursday 8th November 2001

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Air New Zealand (NZSE: AIRVA) has dropped its legal action against Auckland International Airport's (NZSE: AIA) increased landing charges with the two companies signing a new agreement through to 2007.

Under the deal Air NZ has paid the airport outstanding charges covering a 7.5% increase for the year to the end of August 2001.

The increase has been reduced from the previous 8.5%. Air NZ had been withholding payment of the increased amount until its legal action had been heard.

The two companies have also agreed that Air NZ will pay a 5% increase covering the year from the start of September 2001 but a further planned increase of 5% for the following year has been dropped.

"The High Court action initiated by Air NZ against AIAL in 2000 over the consultation process has been discontinued and all outstanding payments have been made to reflect the new pricing rates up to date," says Air NZ acting boss Roger France.

"The international aviation market is currently under significant pressure and it is pleasing that at least one element of uncertainty has been removed."

Mr France says the airline is looking forward to working closely with the airport company over the coming years on charging issues, including consideration of any impact the second runway development may have on landing charges.

Auckland Airport says the agreement reflects the company's acknowledgment of the state of the international aviation market and the current difficulties being experience by the international airlines serving Auckland.

MD, John Goulter, confirmed the company would hold charges at existing levels until 2007.

"This is about the same time that consultation is expected to be required on the effects on landing charges of the construction of the second runway at Auckland International Airport.

Although details of the agreement with Air NZ are confidential, Mr Goulter says the benefits are available for acceptances by all other airlines using the airport.

"The company is confident the agreement will be well received by other airline carriers."

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