Air N.Z. attack on American officials

Press, 9 April 1979, Page 6

Air N.Z. attack on American officials

By

LES BLOXHAM,

I, travel editor

The chief executive of Air New Zealand. Mr M. R. Davis, has taken “grave exception" to comments made by senior directors of the United States Civil Aeronutic’s Board on New Zealand's stance at the bilateral aviation talks in Washington last month.

The officials were reported, in an exclusive interview in “The Press.” to have been disappointed that the New Zealand negotiators showed no enthusiasm for a revised bilateral agreement which would have cleared the way for an open market between the United States and New Zealand

The article, which appeared on Friday, said that the; C.A.B. believed the Govern- ■ ment’s policy of protecting Air New Zealand from open competition was preventing a reduction in air fares to a more realistic level. “I take grave exception to i their comments,” Mr Davis . said at the airline’s news) media forum in Auckland on ’ Friday. “They are a distor- i tion of the facts.” Cyclostyled copies of “The Press” report were presented • to delegates immediately j after the luncheon adjourn-’ ment. Mr Davis described Mr Donald Farmer, the director! of the C.A.B.’s bureau of international aviation (who I was quoted in the article) as [ “an economist by education; and a school-teacher by; trade, whose economic pro-! nouncements most of us I learned in the third year at| secondary school.” He also accused the dir-' ector of the board’s bureau ( of pricing and domestic avia-; tion, Mr Michael 1 evine, of “not doing his homework.”; The economy fare across the; Pacific was 10c a mile, not 17c, as Mr Levine had as-1 serted.

“I thought their knowledge of circumstances down here "as abysmal, and this proves it,” Mr Davis said. Mr Davis challenged the comparison of fares in the article, which reported that Continental, after failing to obtain New Zealand Government approval for a $465 Los; Angeles-Auckland round-trip, fare (with free stopovers) to; begin next month, had abandoned its advertising campaign and settled for the low. est Air New Zealand and Pan American Airways rates' (about $600) for that time of the year. “We have a much lower 1

’fare of $470 available,” he said. ' (Mr Davfs said later, however. that the $470 rate was valid onlv for travel in offIseason months in both directions. Persons living from cite United States in May, for i instance, would not be able to return on this cheap fare ; until October. Continental’s $465 fare, on the other hand, i would have been available 'for passengers beginning and ending their round-trip travel in May. Mr Davis also said that New Zealanders at i present could not fully benefit from the airline’s lewest j fares until April, 1980. Even then they would have to have been away for at least sis i weeks.) Continuing his attack on she C.A.8., Mr Davis said that New Zealand had offered a liberal, “open j skies,” charter policy. “But that was unacceptable to I them, and they tried to move jus to an even more liberal ; policy on a platform they j could not describe and, certain' y in their description to us, we could not understand,” he said. I Mr Davis repeated his ; earlier view that the Amerijeans’ approach to the issue was “extremely parsimonious.” ; Thev were apparent')' not concerned that their drive for extremely low fares in ithe Pacific might cause the I demise of an emerging nation’s transport system, he I said. A senior officer of the ; Ministry of Transport at the seminar firmlv denied that i New Zealand’s stand at I Washington had forced Con|tinental to abandon the I cheap fares it wanted to introduce next month on its new services between the United States and Auckland. Mr J. Kennedy-Good, the 'deputy chief controller of ’air services policy in the Ministry at Wellington, said that Continental was required I under the criterion laid down jin the existing bilateral agreement to justify its proposed fares. “The criterion says that the fares should be set at a reasonable level with due regard to the cost of the service, the characteristics of ‘the service, and the services

(provided by other airlines fly-; ing on the route,” he said. “We did not force them to withdraw the fares; we simply invited them to provide justification as was required under the agreement, but they were unable to do this.” Mr Kennedy-Good said, ' however, that Continental I therefore had no alternative ibut to fall into line with fares already effective on the’ route. ’ Asked whether it was [ likelv that the New Zealand! ’Government would ever' [allow another airline to fly parallel to Air New Zealand lon lower fares, Mr KennedviGood said: “I think that , would prejudge the issue. I I cannot comment.” American policy and the ■C.A.B. were frequently critiicised by Air New Zealand I executives at the forum, but ! the strongest attack was made by the American guest’ speaker at dinner on Friday evening. Mr John Shaffer was administrator of the Federal Aviation Administration from 1969 until 1973 when, in his own words, he was “fired” by the Nixon Administration. Mr ohaffer, who was flown specially by Air New Zealand from Los Angeles to address the gathering, spent 40 minutes berating President Carter and the Civil Aeronautics Board. Of the President, Mr Shaf-j fer said: “He hasn’t accom-i plished anything he prom-1 ised to do, and he he hasn’t a snowball’s chance in hell of being re-elected . . .” j Referring to the men President Carter appointed to the C.A.8.. Mr Shaffer said that there was “hardly a brain” among them. He said that the President’s policy of deregulation was doomed to failure. It had become effective only last year but no-one could jyet say it was working. Mr Shaffer expressed confidence that a change of president next year would see a change in aviation policy, and in conclusion said: "In the meantime, have faith in your airline and don’t’ lower your fares.” Mr Davis presented him with a Maori carving.