Council and community support is needed if Air Chathams is to continue providing an air service to the Eastern Bay.

The airline’s chief commercial officer, Duane Emeny, said the company was reluctantly considering withdrawing from the Whakatāne to Auckland air route within the next six to 12 months.

Since April 2023, the airline had lost over $1 million through providing the route.

“We don’t want to just pull the plug on Whakatāne as Air New Zealand did in 2015, but we need more support if we are going to continue operating,” Mr Emeny said.

Before the Covid-19 pandemic, Whakatāne was the airline’s best performing service with more than 50 percent of passenger travel being business travellers who generally paid more per ticket than leisure flyers.

Retiring the ageing 18-seat Metroliners, which were dedicated to the Whakatāne route, in November 2023 and introducing the 34-seat Saab 340, which is shared with the Kapiti Coast air service, meant Air Chathams could no longer provide the flights needed to cater for the business market.

These included early morning and late afternoon return trips to Auckland for Whakatāne people needing to be in Auckland for the start of the business day and return the same day.

“We can’t make this route work if we don’t cater to business traffic,” Mr Emeny said.

He said the airline had engaged with Whakatāne District Council about the impending retirement of the Metroliner since late 2022 and tabled several options to ensure the Whakatāne service would not be impacted.

“Air Chathams found the council very challenging to work with and not very responsive. In the end, we felt boxed into a corner and had to make quick decisions on whether we continue the route or not,” he said.

“We decided to continue without council supporting an aircraft upgrade, and implemented a schedule change that we knew would not fully meet the local market – especially the business travellers.”

Mr Emeny outlined the support he needed from council at a public excluded briefing on March 26.

The airline is asking the council to lead a local investment campaign to support the purchase of a Saab 340 for Whakatāne and help it access a low-interest loan through the Local Government Funding Agency.

“We don’t expect the council to pay for the aircraft, just to support us,” Mr Emeny said.

“We strongly believe the area can support a larger Saab 340 aircraft, but we need help for the first few years until the route has developed adequately. We must have that shared risk model to ensure we stick at it and make the route a success.”

Air Chathams is also asking that the council forgive a five-year loan of $350,000 it received in 2020 to support flights returning to Whakatāne after the first lockdown of the Covid-19 pandemic. The money was a combined cash support package provided by the three district councils served by Air Chathams.

“It was necessary at the time because Air Chathams did not want to take full liability for restarting air services to those regions when there was a lot of fear related to the virus and the airline did not know how that would impact demand for air travel domestically. Air Chathams believes the original intent of that money has not been honoured by Whakatāne District Council,” Mr Emeny said.

The loan comes due in November.

The council has recently returned to charging previously waived fees for use of the airport, and Air Chathams is seeking further assistance with this to reduce operating losses while a longer-term deal can be finalised.

Mr Emeny said although Whakatāne was an important route for Air Chathams, there were other regions in New Zealand keen to have Air Chathams providing air services or expanding their existing services.

“If you look at a place like Whanganui, they would walk over hot coals for us. They embrace and appreciate the value of direct air services into Auckland, and the value back to their economy,” Mr Emeny said. “We’re not feeling the love [from Whakatāne District Council] at the moment.

“We feel the council takes their existing air service for granted and that that mentality needs to change quickly.”

As of this month, the airline has been flying between Auckland and Whakatāne for 10 years since Air New Zealand withdrew from the route. Air Chathams has carried more than 250,000 passengers over that period.

“We would much rather be having a big party to celebrate that awesome milestone. Instead, we are staring down the barrel of withdrawing our airline from the Eastern Bay.”

Mr Emeny said the council’s Airport Masterplan showed items such as new hangars for private aircraft and a solar farm that amounted to several millions of dollars in spending but noted it made no mention of how the council planned to support the airline.

"What benefit will this spending have for the community and the airport itself if there is no significant air service operating.

“Air Chathams, by nature, is a community airline. We had our beginnings in Chatham Islands where we are effectively the State Highway 1 for that small remote community. It’s that ethos that flows into what we do for smaller regional communities in mainland New Zealand. That’s why a decision like withdrawing from the Eastern Bay of Plenty is so difficult for our family business to make.

“We’re not all about making profits but at some point, you need to ensure you are running a viable business with realistic growth prospects to justify the investment and hard work required to maintain it.”

The council has a meeting in May where support for Air Chathams will be tabled formally for councilors to decide on the future of the air service.

According to council staff, a formal report will go to the May 8 council meeting for consideration. Because it was a commercially sensitive matter, it had been discussed at a public excluded council briefing, but no decision had yet been made.

Mayor Victor Luca said councillors had not yet come to any decision on Mr Emeny’s requests. He would personally like to see more data about what proportion of the district used the airline.

“This is a question I have asked Duane many times. I know visitors use it, definitely tourists, but I would say most people don’t use it. I haven’t got data. I’ve asked him for data, and he’s never supplied it. He gave me a few snippets here and there, but no comprehensive surveys have actually been done.

“He’s got a whole list of demands that Whakatāne ratepayers would have to pay for. The question is, should they?”

“We haven’t in all of this had much of a view of what the public think, and I would like to know.”