National MP and former Air New Zealand CEO Christopher Luxon says he has “no recollection” and was “surprised” to find out a business unit at the airline had helped the Saudi Arabian military by repairing engines on Saudi navy vessels.
Speaking to reporters today, Luxon said of the $3 million contract: “I have no recollection of it. It might have post-dated my time.”
Luxon resigned from Air NZ on June 20, 2019, and left the airline in September that year after an intervening period before a new CEO was appointed.
“I think we’ve all been surprised by it,” he said of the news.
Current CEO Greg Foran said the contact happened before his time at the airline. Because of the value of the contract, the decision to sign it off didn't reach executive level, he said.
Yesterday, 1 NEWS political reporter Benedict Collins revealed the airline’s business unit Gas Turbines had carried out work for the Saudi navy through a third-party contract. Gas Turbines had been working on two engines and one power turbine for the navy from Auckland.
That’s despite the Saudi navy blocking food and medicine getting into Yemen, fuelling a humanitarian crisis and putting millions of people at risk of starvation.
Luxon said he was aware Gas Turbines, which specialises in servicing military marine engines and turbines, had worked for other navies before and had publicly declared so.
When asked if he was aware when he was CEO that Gas Turbines had helped the Saudi Arabian military, Luxon said: “I’ve got no idea, I don’t know.”
Luxon said he believed there was a breakdown in the airline’s processes to make sure its supply chains were ethical, which was why he did not find out about the Saudi contract as CEO despite it being politically sensitive.
He added: “It’s good to see that they’ve [Air NZ] come out and admitted this morning that, yes, it’s an error of judgment and they’re wanting to do something about that and stop that, which is great.”
When asked whether the contract would have continued had he known about it, he said it wasn’t appropriate for him to comment as he isn’t at Air NZ anymore, and that further questions should be put to the airline.
Prime Minister Jacinda Ardern said today she didn’t think it was appropriate Air NZ had the contract in the first place.
"This is something that has ramifications for New Zealand, its reputation and that’s why we’re making sure we’re across how it happened."
Ardern only became aware of Air NZ's involvement with the Saudi navy last night after 1 NEWS’ report. Air NZ's shareholding minister, Grant Robertson, said he also wasn’t aware of the contract until contacted by 1 NEWS.
On Breakfast earlier today, Foran said of Gas Turbine’s work for the Saudi Navy: “This is a contract that was put in place back in 2019, before my time.”
The former Walmart boss’ appointment as Air NZ’s new CEO was publicly announced on October 11, 2019.
Foran said he only became aware of the Saudi contract 10 days ago, after which he took “immediate action”.
“It has been suggested that we’ve been involved in some type of secret deal here and I can assure you that is not the case. It is a case of poor judgment.”
A review would be underway to determine if the airline’s processes, given he did not know about the contract, Foran said.
But he also said Gas Turbines will complete the unfinished work it has left in the contract.
“We’ve got an engine that is in some pieces on the floor so we need to get that back in a condition that we can get that back to them ... We’ll work through what that looks like at this point.”