Auckland Airport warned its planned $53m profit not justified

November 1, 2018

The airport is struggling with an influx of tourists and a planned $2 billion upgrade.

New Zealand's largest airport has been warned over its high profits, the Commerce Commission saying Auckland Airport needs to justify its charges.

It comes as the airport struggles with an influx of tourists and a planned $2 billion upgrade. 

The commission has ruled Auckland Airport's planned $53 million profit is not justified. It says while not all the profit is excessive, it's not fully "warranted".

Airports charge airlines, who pass the cost onto passengers.

Justin Tighe-Umbers of the Board of Airlines Representatives of New Zealand says the board is calling on the airport "to hand back to their customers - airlines and travellers - the $53 million that they're looking to overcharge".

"Airlines are under significant cost pressure. Jet fuel prices just doubled over the last 18 months."

Transport Minister Phil Twyford says airports need to price fairly.

"It's important, it's really critical, that monopoly infrastructure like these airports, price in a way that's fair."

Auckland Airport refused to answer 1 NEWS questions on camera about its expected profit, referring instead to a statement detailing the airport's planned $2 billion infrastructure upgrade, aimed at dealing with rocketing visitor numbers.

Auckland Airport says the average planned increase is 66 cents per passenger journey over the next five years - going up from $15.44 to $16.10 - to recover operating costs and help support future investment.

Part of that includes the airport's new departure lounge.

"All of these cost increments really add up to the cost of travel," Mr Tighe-Umbers said.

'We've actually reached the point now where for an average low cost fare across the Tasman, a return ticket, over half of that fare is actually made up by these taxes and levies."

Airlines are now calling on the Commerce Commission to go further and conduct an inquiry into the airport's monopoly.

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