Auckland Airport Revises Forecast Upward Amid Growing Demand

In response to a speedy recovery, New Zealand’s Auckland Airport has revised its forecast for the financial year 2023.

Auckland Airport, the largest international gateway to the country, has seen a strong demand in domestic and international travel, in particular on North and South America, South Pacific and Trans-Tasman routes. The airport sees the recovery as universal, with travel demand to the U.K. and Europe on the rise as well.

The airport expects international passenger numbers will be between 60% and 70% of pre-Covid-19 levels and domestic passenger numbers could reach 85-90% of those figures, with a profit after tax between 100 million New Zealand Dollars ($57.9 million) and 130 million New Zealand Dollars for the financial year of 2023. That represents an uplift on guidance provided in August of between 50 million New Zealand Dollars to 100 million New Zealand Dollars.

The airport handled 5.6 million passengers in the financial year of 2022 (which ended in June), recording a net underlying loss after tax of 11.6 million New Zealand Dollars.

In addition, the airport agrees with IATA, that the global industry will recover to pre-pandemic levels by the end of 2024.

The airport’s latest announcement expressed concern over the North Asia market. China, one of the largest tourism markets pre-pandemic for New Zealand, has no sign of relaxing its travel restriction thus far. The other countries in North Asia have reopened their border gradually, Japan has followed in South Korea’s footsteps to welcome travelers in October.

Following the lifting of travel restrictions in Japan, Air New Zealand has seen a strong uptick in interest and bookings. Air New Zealand operates three times-a-week services between Auckland and Tokyo as a result. Japan was New Zealand’s fifth-largest international visitor market with 100,000 visitors arriving in 2019.

After the pandemic, North America has been identified as one of the priority markets for Kiwis. United Airlines and American Airlines return to New Zealand in October, Auckland becomes the most connected Australasian city to North America. Five carriers will provide eight destinations, offering up to 60 flights per week.

Competing with Its Neighbors

On the other hand, Auckland Airport has mentioned that it will compete with other countries, such as Australia, to entice more airlines and visitors to return to New Zealand. Australia has invested heavily in encouraging airlines to come back to Australia.

Despite the challenges aviation and aviation-adjacent industries are facing — such as the availability of crew, ground staff and resourcing associated with bringing fleets out of hibernation — the airport remains optimistic.

“We are increasingly confident that aviation is returning to normal, with the structure of the market becoming more balanced across inbound and outbound travel, and ‘business’, ‘friends and family’ and ‘leisure’ travel categories,” Carrie Hurihanganui, the chief executive of the airport, said in a statement.

Meanwhile, the airport has been focusing on the expansion of the terminal. The domestic terminal will end its services after six decades. Auckland Airport is going to combine its domestic and international terminals. According to the airport, the airlines currently pay some of the lowest domestic charges in Australasia to operate at the airport due to the age of the domestic terminal. The new terminal airport is expected to be completed in five years after construction is started.