Auckland International Airport Limited is vital to the kiwi economy, generating billions of dollars, employing over ten thousand workers, and creating trade and tourism connections to spots all over the world. The largest airport in New Zealand, Auckland International was voted one of the ten best airports in the world, two years running.

Over 70 percent of visitors to New Zealand pass through Auckland International on their way to explore the country for business or pleasure. The airport is second only to Sydney Airport in terms of traffic within the Australasia region. Thirty international airlines serve the airport, carrying in excess of thirteen million passengers annually. Airport executives project that this number will increase to 24 million passengers by 2025, as New Zealand increases in popularity as a travel destination.

In response to the projected influx of tourists, the airport has expanded their international terminal. The LEED certified terminal takes environmental ramifications into account while accommodating the additional airline traffic. The expansion comes in time for the 2011 Rugby World Cup, an event that will substantially increase international traffic through the airport.

The airport began as an airfield in 1928 for use by the Auckland Aero Club. By 1966, the site was transformed into the city’s primary airport, serving domestic travel. Eleven years later, an international terminal was built, opening the airport to international travelers. During this time, the government of New Zealand owned the majority of shares in the airport. However, in 1988, the government sold its shares, and the airport became the world’s fifth publicly listed airport.

ECONOMIC EFFICIENCY AND PRODUCTIVITY

The downturn in the economy severely affected the travel industry. Instead of planning destination vacations, as they had in years past, travelers elected to travel to places closer to home within their own countries. Additionally, fuel and operation costs increased, putting financial pressure on the airlines to meet demand and turn a profit for their shareholders. These financial burdens were passed on to the airports, including Auckland International Airport. As a result of the economic downturn, the airport was forced to reevaluate its operational and financial plans in an effort to save money and improve revenue.

Executives at Auckland International Airport devised a practical five-year growth plan that identifies where money is made, lost and saved. Additionally, the growth plan helps the airport prepare for positive growth when the economy finally turns around. The plan advises a two-phased approach that focuses on profitable investments and the expansion into major markets. The airport also plans to incorporate lean practices into the production workflow in an effort to streamline passengers, aircraft movement and cargo processes. Once in practice, the airport hopes to save money and create a more efficient and productive system of travel for airport staff and the travelers themselves.

To assess the viability of the five-year growth plan, airport management outlined the 2008 revenue and expenditures for the aeronautical and retail divisions. The aeronautical division provides 45 percent of the total revenue of the airport through airfield income and passenger and terminal services charges. The retail division brings in 38 percent of the total revenue through duty-free, currency exchange, food and beverage, specialty retail and car parking.

Auckland International Airport’s capital allocation programme focuses on growth, regulations, capital maintenance and profit seeking. Over the next few years, the airport will focus more money towards the Northern Runway and the First Floor International Terminal Redevelopment Project, which will provide a significant financial benefit to the airport when completed.

The airport, and airline industry in general, is often choked with regulations. The airport executives and manager try to find a balance between risk and economic outcomes in this area. Auckland International seeks to carefully manage the maintenance and life cycle costs necessary to run the airport. Finally, the growth plan explicitly states that proposals for discretionary spending will require compelling evidence in order to release the funds. By cutting costs, assessing revenue, and employing proven efficiency models, Auckland International Airport is prepared to thrive during the global recession and succeed when economic recovery occurs.

IMPROVING AIRPORT EFFICIENCY

In an effort to improve the passenger experience, airport officials have adopted new technologies to process and check in travelers quickly and efficiently. They have extended their primary line counters to forty-four and increased the number of x-ray screening positions to twelve. For domestic flights, screeners use “smart gate” technology with pod-type scanning systems to securely process travelers to their flights in a timely manner.

Efficiency doesn’t stop at security. For international travelers, duty-free retail is located next to the security processing area. Travelers can stock up on popular brands and goods at discounted prices before they board their flight. Since retail pulls such a large proportion of the airport’s revenue, providing travelers convenient access to these shops will improve profits for the airport as well.

In anticipation for the Rugby World Cup next year, Auckland International expanded their runway to improve the safety and access of smaller, domestic aircraft. In addition to accommodating an increase of travelers on more flights, the expansion improves safety as the smaller planes no longer have to contend with larger international planes for space on the runway. It also helps to prevent flight delays for other travelers waiting for international or domestic flights.

DEDICATION TO SUSTAINABILITY

New Zealand is known for its beautiful vistas and natural resources. It makes sense that the country’s major airport would put a focus on sustainability and social responsibility. A member of EarthCheck, a benchmarking, certification and management organization for the tourism industry, Auckland International is constantly seeking ways to reduce its ecological footprint. Pier B, the addition to the international terminal that opened in 2008, received LEED certification in 2009 by the United States Green Building Council. LEED certification takes into account a building’s water and energy efficiency, building site, building materials, and methods of construction. As part of the LEED certification, the airport created twenty-one priority parking stalls in the international car park for fuel-efficient and hybrid vehicles.

The international terminal also touts several other green technologies, including high-efficiency chillers for the air-conditioning, improved insulation, low-energy lighting and way-finding signage, and the largest solar panel array in New Zealand. Power from the award-winning photovoltaic solar power system illuminates the lights of the arrivals corridor during the day and generates an impressive 49,500 kWhr of energy annually. The facility also uses energy from the solar panels to pre-heat the water in the hot water system and provide energy for the public restrooms in the arrivals area.

Due to regional drought conditions, water reuse and efficiency are important to the mission of Auckland International Airport. Cisterns for rainwater harvesting are located around the international expansion area, storing rainwater from the roof of the terminal for use in the air-conditioning cooling system. The airport estimates that approximately 6,000m3 of this rainwater will be re-used over the course of the year.

Auckland International Airport works with the Auckland Regional Transport Authority to offer public transportation to the airport for travelers and employees alike from downtown Auckland and Manukau City. Buses travel the route on a regular basis, stopping in Auckland every 15 minutes and Manukau City every half hour. Additionally, the airport encourages their employees to take public transportation, carpool or cycle to work to reduce traffic congestion in the area. Known as the Lift Program, over 600 of airport employees take advantage of it to commute to work each day.

FUTURE GROWTH

On the heels of opening the eco-friendly international terminal, Auckland International Airport is planning for the next big event, the Rugby World Cup in 2011. Many of the improvements to passenger security, baggage handling efficiency, and runway expansions were implemented with this event in mind. There are also plans to build a hotel on site, a great service for travelers on their way into and out of New Zealand.

In accordance to their commitment in their five-year growth plan to expand into other markets and invest in profitable businesses, Auckland International Airport bought shares of Cairns and Port Macquarie Airports in Australia. Located in Queensland, Cairns Airport is the seventh busiest airport in Australia. The airport offers domestic and international service to destination points all over Australia, the Asia Pacific region and all over the world. Port Macquarie Airport is located in New South Wales. Though to date only three airlines—Qantas, Brindabella Airlines, and Virgin Blue—offer flights into and out of this airport, the airport serves as an important hub for the local communities.

Improvements are vital to Auckland International Airport’s mission to provide passengers with a positive and comfortable travel experience. Their commitment to sustainable technologies and LEED standards positions the airport as a global leader in green business. Other airports can use the Auckland International Airport as a model when considering eco-conscious, LEED-certified expansions to their existing facilities. As New Zealand becomes a more popular travel destination, Auckland International Airport is positioned to comfortably and efficiently process travelers who enter and leave the country, with minimal impact on the planet.