Traffic jams to the airport caused mass panic in Auckland over the weekend as fliers struggled to get to their flights because a huge new mall with over a hundred shops had opened nearby. It jammed George Bolt Memorial Drive, which is the airport road. So who owns it?
"Mānawa Bay is proudly developed and owned by Auckland International Airport Ltd" the brochures say. Of course. When will Aucklanders understand what was perceptively pointed out, as usual, months ago, ahead of the news, by your helpful consumer and social service, DownToEarth.Kiwi. We explained how in America "traditional malls in cities are declining due to online shopping, but retail sales at airports are booming. Slate Magazine reports, "Your Misery at the Airport Is Great for Business: Retail in terminals is booming" at a 20% compound growth rate. Airports supply the greatest desire of physical retail: foot traffic. Misery of flyers brings joy to airport retail. Delays mean more money spent in airport shops. Airlines now supply little to eat or drink. So restaurants at airports are thriving".
So Aucklanders, get it into your heads that Auckland Airport wants you to miss your flight. Its executives will get paid more for every travel cock-up since then you will have to hang out at the airport for longer and spend more at "Mānawa Bay" - why not go and have a $100 spa-massage there to de-stress? That will give a boost to Auckland Airports stock price.
So Aucklanders, get it into your heads that Auckland Airport wants you to miss your flight. Its executives will get paid more for every travel cock-up since then you will have to hang out at the airport for longer and spend more at "Mānawa Bay" - why not go and have a $100 spa-massage there to de-stress? That will give a boost to Auckland Airports stock price.
The CEO of Air NZ was once boss of Walmart in America. He understands how Auckland Airport knows there's more money in the mall business than running an efficient, low margin airport. After all, what do you think our National Airport is: a social service? No its a good old fashioned Kiwi monopoly with a market even more captive than the Supermarket Duopoly (oops, we better stop that language, or Foodstuffs will send another letter from Chapman Tripp to the University of Auckland threatening defamation).
On that note, we better even stop writing this Blog, since Auckland Airport may get the same idea and threaten us with defamation for revealing the truth about how it is making money these days. So much for freedom of speech. Big Business put an end to that in NZ - and I wrongly thought that the threat was coming from the left.
Professor Robert MacCulloch holds the Matthew S. Abel Chair of Macroeconomics at Auckland University. He has previously worked at the Reserve Bank, Oxford University, and the London School of Economics. He runs the blog Down to Earth Kiwi from where this article was sourced.
1 comment:
Can I suggest, that if - Auckland International Airport Ltd - own this flash new mall, what they should consider is Airline Check in counters, with bus transfer system to the departure lounge[s] - the 'the punters could 'breeze thru buy up large', check in - fly out - and the incoming could be bussed to the mall to 'buy up large and move on'. Money for jam.
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