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Airways Corporation defends $30m air traffic system deal

By Michele Simpson

Friday 12th May 2000

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Airways Corporation is dodging allegations of backhanders and insider trading and has now signed off a deal to buy a $30 million air traffic- control system which has barely been tested overseas.

The new Skyline air traffic management system has been trialed only in Argentina by US firm Lockheed Martin, which this week announced a new joint venture with Airways Corporation to replace the current air traffic-control system .

The replacement system from Lockheed Martin, which claims daily control of 60% of the world's air traffic, was done without a tender and has been the subject of a political debate over allegations of kickbacks and insider trading at Airways Corporation.

Representatives of the French company, Airsys ATM, which designed the air traffic-control system being used here, have come to New Zealand demanding answers. They have put their case to Act New Zealand MP Rodney Hide. Simon Leary, sales and marketing manager for Airsys ATM in the Asia Pacific region, said up until a few months ago the company had been in regular contact with Airways and had been here giving presentations on the understanding there would be a tender for the new contract in 2002.

Mr Leary said Skyline was not an established air traffic-control system. "With any air traffic-management system that has not been operationally validated - ie, it has not had a number of years in the operation environment - there are always questions about how stable that product is and that has an impact on air safety," he said.

Airways Corporation chief executive officer Craig Sinclair denied passenger safety was being jeopardised by the new Skyline system. He said it was being used in Argentina, was nearly up and running in Korea and was also planned for implementation in Scotland.

"It has passed factory tests. It is not the sort of thing where we get a box and plug it into the wall," Mr Sinclair said. "We have done a technical evaluation and a financial evaluation and the system has what we need for New Zealand air space over the next 10 years."

No tender was put out for the system because Airways Corporation had already formed a business partnership with Lockheed Martin, he said.

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