1 00:00:00,000 --> 00:00:01,760 Speaker 1: It terms out. We do have a program of sorts 2 00:00:01,800 --> 00:00:04,520 Speaker 1: to help regional air travel. Up to thirty million dollars 3 00:00:04,519 --> 00:00:06,080 Speaker 1: in loans is what we're dealing with. This comes to 4 00:00:06,120 --> 00:00:09,360 Speaker 1: us from the Regional Infrastructure Fund. It's for small passenger airlines. 5 00:00:09,480 --> 00:00:12,080 Speaker 1: James Meagher is the Associate Minister of Transporting, is behind 6 00:00:12,119 --> 00:00:12,719 Speaker 1: and he's with us. 7 00:00:12,720 --> 00:00:14,000 Speaker 2: Good morning morning mate. 8 00:00:14,120 --> 00:00:15,640 Speaker 1: Are you regionally as savior? 9 00:00:17,200 --> 00:00:19,600 Speaker 2: I wouldn't call myself a savior, but the government has 10 00:00:19,720 --> 00:00:24,000 Speaker 2: done or taken some steps to support regional connectivity interlining. 11 00:00:24,160 --> 00:00:28,320 Speaker 2: What is it? So it's complicated to explain, but simply, 12 00:00:28,360 --> 00:00:30,600 Speaker 2: when you go overseas, you will book a flight and 13 00:00:30,640 --> 00:00:32,360 Speaker 2: it'll get you from A to B and you might 14 00:00:32,400 --> 00:00:35,800 Speaker 2: fly multiple airlines in that ticket. You can't do that domestically. 15 00:00:35,840 --> 00:00:37,680 Speaker 2: So we're going to introduce that system here. So if 16 00:00:37,680 --> 00:00:40,279 Speaker 2: you're flying from say we Sport to Auckland, you can 17 00:00:40,320 --> 00:00:43,080 Speaker 2: fly We're Sport to well into Wellington to Auckland, different airlines, 18 00:00:43,120 --> 00:00:44,479 Speaker 2: one process, make it easy for you. 19 00:00:44,800 --> 00:00:47,240 Speaker 1: Right. Is that really the problem that regional air is 20 00:00:47,240 --> 00:00:49,159 Speaker 1: facing in this country? Is it really just getting to 21 00:00:49,240 --> 00:00:51,400 Speaker 1: Westport to Auckland in a way that you can afford 22 00:00:51,440 --> 00:00:52,920 Speaker 1: in the airlines is not going to get busted. 23 00:00:53,680 --> 00:00:57,080 Speaker 2: No, that's not a significant problem. That's going to assist consumers, 24 00:00:57,120 --> 00:00:59,280 Speaker 2: I think, make it easier for them to travel. The 25 00:00:59,320 --> 00:01:01,880 Speaker 2: main problem is that really the costs on airlines in 26 00:01:01,920 --> 00:01:04,880 Speaker 2: the aviation sector are significant the moment, and they're doing it tough. 27 00:01:04,959 --> 00:01:07,200 Speaker 2: So we are trying to come up with ways to 28 00:01:07,200 --> 00:01:09,560 Speaker 2: help support that, and the announcement around some of the 29 00:01:09,600 --> 00:01:10,800 Speaker 2: consistory loans is one of those. 30 00:01:11,000 --> 00:01:13,880 Speaker 1: The only thing I can think that's a value in 31 00:01:13,959 --> 00:01:17,000 Speaker 1: a loan is you can see better days therefore, or 32 00:01:17,000 --> 00:01:18,800 Speaker 1: if I can get some you know, get a bit 33 00:01:18,880 --> 00:01:21,080 Speaker 1: liquid between now and then. Is that what you're trying 34 00:01:21,120 --> 00:01:22,319 Speaker 1: to argue is going on here? 35 00:01:23,200 --> 00:01:25,120 Speaker 2: I think you've hit the nail on the head. The 36 00:01:25,200 --> 00:01:27,000 Speaker 2: underlying solution to all of this is going to be 37 00:01:27,000 --> 00:01:29,520 Speaker 2: to continue to grow passaging numbers back to where they 38 00:01:29,520 --> 00:01:31,720 Speaker 2: were pre COVID, so we're only at about ninety percent 39 00:01:31,760 --> 00:01:34,280 Speaker 2: of pre COVID. You grow the market, grow the numbers. 40 00:01:34,319 --> 00:01:36,800 Speaker 2: That's going to provide the income to get these guys going. 41 00:01:37,080 --> 00:01:38,680 Speaker 2: If we can buy ourselves a bit of time as 42 00:01:38,720 --> 00:01:41,040 Speaker 2: those passage and numbers come back, whether that's from overseas 43 00:01:41,120 --> 00:01:42,520 Speaker 2: or domestically, that'll get us there. 44 00:01:42,600 --> 00:01:44,920 Speaker 1: Are they having trouble with their banks at the moment? 45 00:01:45,000 --> 00:01:46,280 Speaker 1: Is that why you need to step in? 46 00:01:47,480 --> 00:01:50,160 Speaker 2: Different airlines are having different challenges. Some of them are 47 00:01:50,240 --> 00:01:52,000 Speaker 2: carrying a bit of debt, and of course that debt 48 00:01:52,040 --> 00:01:55,040 Speaker 2: comes at a significant refinancing costs, and that means that 49 00:01:55,080 --> 00:01:56,800 Speaker 2: when they're looking at their balance sheets and how they're 50 00:01:56,800 --> 00:01:58,360 Speaker 2: actually going to be able to make a profit and 51 00:01:58,440 --> 00:02:01,080 Speaker 2: run a business, I have to sell some of their 52 00:02:01,280 --> 00:02:03,560 Speaker 2: assets and that reduces some of the routes they can fly. 53 00:02:03,720 --> 00:02:06,080 Speaker 2: So that will be some of the assistants. Others are 54 00:02:06,120 --> 00:02:08,200 Speaker 2: just looking for opportunities to actually fly those routes and 55 00:02:08,200 --> 00:02:09,120 Speaker 2: give them some certainty. 56 00:02:09,320 --> 00:02:11,359 Speaker 1: Why can't see I can't remember the note. I might 57 00:02:11,360 --> 00:02:13,560 Speaker 1: have been sounds anyway, I can't remember. The point was 58 00:02:13,600 --> 00:02:16,239 Speaker 1: they were saying, look, we've got demand. The demand is there, 59 00:02:16,240 --> 00:02:18,160 Speaker 1: but we can't make money. I can't work out why 60 00:02:18,160 --> 00:02:19,079 Speaker 1: they don't charge more. 61 00:02:19,440 --> 00:02:19,639 Speaker 2: Are you? 62 00:02:19,840 --> 00:02:22,480 Speaker 1: Are you confident these people are running their business as well? 63 00:02:23,800 --> 00:02:25,040 Speaker 2: I think on the whole, I think one of the 64 00:02:25,040 --> 00:02:27,799 Speaker 2: reasons they can't charge more in some instances is that 65 00:02:27,880 --> 00:02:31,720 Speaker 2: the alternative is surface travel. And when the alternative surface travel, 66 00:02:31,760 --> 00:02:33,560 Speaker 2: and you've got a family of for making a decision 67 00:02:33,560 --> 00:02:36,440 Speaker 2: of whether they can fly regionally or not. If you 68 00:02:36,480 --> 00:02:38,120 Speaker 2: push the prices too high, they're going to make that 69 00:02:38,160 --> 00:02:40,480 Speaker 2: decision to travel by the road, so they are limited 70 00:02:40,560 --> 00:02:42,240 Speaker 2: by the markers to what they can charge. 71 00:02:42,440 --> 00:02:44,960 Speaker 1: Is this your best foot forward? This is what the 72 00:02:45,000 --> 00:02:47,360 Speaker 1: government can do and is prepared to do. But that 73 00:02:47,600 --> 00:02:48,800 Speaker 1: is it. 74 00:02:48,800 --> 00:02:50,919 Speaker 2: It's our first step. We've got a range of other 75 00:02:50,960 --> 00:02:53,960 Speaker 2: actions and train as well, whether that's looking at workforce development. 76 00:02:53,960 --> 00:02:55,760 Speaker 2: You know we've got a shortage of engineers and pilots, 77 00:02:55,760 --> 00:02:58,240 Speaker 2: so can we make it easier to train and retain 78 00:02:58,400 --> 00:03:02,280 Speaker 2: those staff. Here we're looking at things like what are 79 00:03:02,280 --> 00:03:04,760 Speaker 2: we doing with government costs on the sector. Some of 80 00:03:04,760 --> 00:03:07,200 Speaker 2: our own fees have gone up post COVID, so what 81 00:03:07,200 --> 00:03:08,560 Speaker 2: can we do to work those down as well? And 82 00:03:08,560 --> 00:03:10,440 Speaker 2: there's a range of things we can do. But consistory 83 00:03:10,480 --> 00:03:11,320 Speaker 2: lines is part of it. 84 00:03:11,520 --> 00:03:12,359 Speaker 1: Are you hopeful? 85 00:03:13,440 --> 00:03:15,280 Speaker 2: I am hopeful. I think there's a lot of promise 86 00:03:15,320 --> 00:03:16,920 Speaker 2: out there. The rest of the world is back to 87 00:03:16,960 --> 00:03:19,560 Speaker 2: passenger numbers where they were pre COVID. We can get 88 00:03:19,560 --> 00:03:21,679 Speaker 2: there too. What I think it demonstrates is that when 89 00:03:21,720 --> 00:03:24,400 Speaker 2: things get turned off in New Zealand, it's harder and 90 00:03:24,440 --> 00:03:27,280 Speaker 2: longer to get them turned back on. So international and 91 00:03:27,280 --> 00:03:30,120 Speaker 2: domestic travel is one of those examples. We can get there, 92 00:03:30,160 --> 00:03:31,320 Speaker 2: We just need to give a bit of time. 93 00:03:31,400 --> 00:03:33,760 Speaker 1: Well I hope so appreciate it. James Mega, Associate to 94 00:03:33,880 --> 00:03:37,200 Speaker 1: Minister of Transport. For more from The mic Asking Breakfast, 95 00:03:37,360 --> 00:03:40,680 Speaker 1: listen live to news talks that'd be from six am weekdays, 96 00:03:40,920 --> 00:03:42,960 Speaker 1: or follow the podcast on iHeartRadio.