ROUTES ASIA: The Small Airport Thinking Big

Continental Airlines will operate the Boeing 787 on its services from Houston to Auckland from 2012, but how did the (small) New Zealand airport land this (big) landmark service. No matter one’s size, it pays to think big. Auckland Airport – major hub for New Zealand, a charming yet diminutive country with a total population of only 4.3 million people – has proven that with a masterstroke that has left other bigger players scratching their heads.

“It’s most definitely a coup – it is helping to put us on the map,” says Matthew Findlay, Auckland Airport’s Route Development Manager. “We know that some airline executives have asked: how does that happen? For others, it made them sit up and wonder: what are we missing?”

Findlay is referring to the tie-up with Continental Airlines (now merged with United Airlines) that will see Auckland land the first Boeing 787-8 Dreamliner service in the southern hemisphere. The newest addition to the Boeing fleet has long-range capability, and its lighter weight improves fuel efficiency and allows for increased cargo capacity. Passengers are likely to be more impressed by the aircraft’s lie-flat seats, huge windows, and an onboard humidity control system that is designed to mimimise jetlag.

Conceding that this route announcement was “something out of the box”, Findlay notes that this is precisely the strategy that Auckland Airport’s management has been pushing: “Think outside the box, and carve out your own airline niche to maximise your profits and returns for your airline shareholders.” The alternative? “Why continue to compete in an already crowded market?” Findlay responds.

Yet he rejects any David–Goliath inference. “Size isn’t everything. How can that work? It’s not just about the size of the two city pairs – it’s about the networks at either end that can provide all the necessary feed with partners.

In addition, there is a large market of Americans who want to get here – Tourism New Zealand calls them the ‘Active Considerers’ – people who know about New Zealand, want to come for a holiday, but haven’t to date for a variety of reasons.” Besides, says Findlay, Continental “knows what it is doing”.

The US is the third largest source of tourist arrivals to New Zealand, and a significant trading partner for the Kiwi economy. “Access to an interior point in the US, which is also a member of the Star Alliance and will work with Air New Zealand, ticks all the boxes. It broadens our connectivity to states and cities east of the Rockies, that in the past have seemed too remote for many Americans.”

The Continental deal was a result of two years’ work, and Findlay is understandably pleased with the result. “To have the B787 announced first for Auckland was ‘best in class’, world first stuff,” he says. The outcome was even sweeter considering that discussions took place during an economic slowdown from 2008, when trading conditions were tough.

“We worked very hard on this, with almost two years of constant discussions, regular visits, and engagement with a huge number of people at different levels in both business and community groups, and local and state government agencies,” says Findlay. “I even attended Rotary meetings in Houston to push the message on one occasion. I’d hate to admit how many times we visited Continental Airlines, but each time we learnt more. They came to trust us, and, I hope, they chose us to make the announcement because we’re easy to deal with. They could have decided to fly that plane anywhere in the world, and they chose us.”

However, frustrating delays in delivery of the aircraft to many airlines have pushed back the start date of this service several times – the current estimate is 2012. Despite the wait, Findlay says that at Auckland Airport “the aprons are ready, we have the capacity, and can’t wait for it to arrive”.

Exciting as it is, that’s not the only route development making news in Auckland. “Encouraging an existing carrier to grow frequencies is just as important to us as a new market entrant, particularly from a new destination or source market, such as Guangzhou in China. We’re proactive

in working with and talking to airlines, and diversifying our markets is also a good way to protect against one market that may suffer in any given event – from, say, unfavourable weather, economic downturn or political unrest – and provides exposure to other strong markets.”

* Read the full article in the latest edition of Routes News. A copy of the world air service development magazine is also in all delegate bags at Routes Asia and there are copies on the Routes News stand.