Airline insider’s journey from golden age to Covid
Justin Tighe-umbers’ baptism of fire in the airline business proved to be ideal training for an even deeper crisis that was to hit later. The executive director of the Board of Airline Representatives (Barnz) started work three months before a short, sharp emergency: a ruptured pipeline near Marsden Point that starved airlines of fuel at Auckland Airport.
During the October 2017 emergency, fuel had to be trucked and flown to the airport, and airlines were forced to fly skeleton schedules as supplies were rationed down to as little as a quarter of usual requirements while a busy holiday season began.
Tighe-umbers, with a background in telecoms, had a deep dive into how complex aviation is and the impact of “Black Swan” events. He quickly became a calm, articulate voice for airlines in the media as executives were immersed in dealing with the crisis.
“I’d been in the role for three months and so that was a really good learning curve for working closely with the crisis team at the Ministry of Transport, with the airports and with the airlines,” says Tighe-umbers.
His settling-in period was short, and he got to meet everyone in the sector in double-quick time.
Tighe-umbers, 46, is leaving the post next month after five years to represent another vital transport mode — the trucking industry, as chief executive of National Road Carriers.
The airline industry’s response during that pipeline failure impressed him.
“It was really a good opportunity to understand those industry dynamics and see first-hand how incredibly quickly this industry can drop everything, pull together and do what needs to be done.”
The pipeline was patched up in days and the emergency passed relatively quickly. But it gave Tighe-umbers a foretaste of how quickly things can go wrong in aviation and prepared him — and the sector — for the much deeper crisis that hit a little over two years later.
Clearer air
Air travel to New Zealand started to take off rapidly from around 2013 as airlines enjoyed relatively low fuel prices, new aircraft and growing middle class populations keen on travel.
Once through the fuel crisis, Tigheumbers headed Barnz during two heady years from late 2017 to the end of 2019.
“There was a huge amount of growth through that period. I mean, they were halcyon days when we got up to 30 airline members. New Zealand’s never been as well connected as we were then with incredible growth and incredible value airfares.”
The industry was going “full noise” and in 2019 contributed to an estimated 329,000 jobs, brought in 18 million international passengers who spent $17 billion, and aircraft also transported $23b worth of cargo.
“There was huge positivity, a lot of new routes seemed to be launched every
week. There was a real buzz and it felt like the possibilities were endless in terms of where you’d be able to travel.”
Barnz, whose board comprises mainly airline heads but also ground handlers and facilities managers, works with the Government, regulators, businesses and local communities to provide cost savings for airlines and service improvements. Much energy goes into assessing airports’ business and capital plans, which can sometimes end up in some hard-edged negotiations.
“During those years it was all about negotiations, working with the airports on pricing and working on their capital plans. At that time, you’re looking at Auckland Airport with the master plan and a northern runway — the huge development prospects right before the pandemic hits.”
‘Bit surreal’
Airlines are seen as something of a canary in the coalmine for the wider economy, and when a mystery virus started spreading out of Wuhan, China, from the end of 2019, it was the early warning system with bells on for the biggest global health emergency in a century.
“I remember having a feeling that it felt like we were two or three weeks ahead of where the rest of New Zealand was at in terms of seeing what was coming, which was a little bit surreal,” says Tighe-umbers.
There had been repatriation rescue flights, drastic capacity cuts and cancellations throughout February 2020, but it was the United States’ decision to close its borders in March, followed shortly after by New Zealand, that delivered the body blows.
“I remember a moment walking along Willis St in Wellington, looking at the phone and saw the headline that Trump’s closed American borders. That was a real watershed moment. I thought ‘wow, this is really happening’.”
When New Zealand did the same, member airlines had planes in the air.
“I had to tell all of the airlines that over email and my phone just about melted because their aircraft were in the sky, they were contacting me about what that meant for passengers. I had to spend the night in Ministry of Transport (MOT) with the team near just working to make sure people could get across the border.”
Within weeks — when the repatriation flights were gone and before the MIQ system was established — there was just a trickle of passengers flying into and around New Zealand. It looked grim for airlines.
“Certainly in the darkest moments, you did feel like you’re waving goodbye to the world as you saw carriers stop operating here,” he says.
However, in an industry battlehardened by health emergencies, global economic crises and the threat of daily disruption caused by anything from erupting volcanoes to snow storms, there was stoicism and some quick action.
“There was calmness and a matter-offact approach: ‘here’s the new settings, what do we do to make that work?’”
Freight provided a lifeline for New Zealand and he says the MOT responded quickly to help airlines keep that flowing.
Freight supported several airlines and nearly all of the board’s 30 members have maintained a presence in New Zealand, with many now rebuilding schedules or committed to doing so.
By the end of this year about twothirds of pre-pandemic international capacity will be restored, something Tighe-umbers didn’t think was possible six months ago as the Government moved slowly to reopen borders compared to many countries.
The outlook
It’s uncertain how long it will take to reach pre-covid capacity in this country but Tighe-umbers is sure the price of flying will be different for some time.
Supply and demand are out of balance, with two years of pent-up demand for visiting friends and relatives and not enough capacity. This is driving up prices in the short term.
Longer term, cost pressure would remain for airlines rebuilding decimated balance sheets.
While there would be some bargain fares, he says steep discounts won’t be seen for some years.
Changing lanes
Tighe-umbers says that when he took the Barnz job, he indicated to the board that he would be there for about four to five years.
“I was interested in a New Zealand Inc role that was going to be important for the economy and that’s why I was attracted to National Road Carriers.”
The organisation has about 1500 members, and he sees similarities between air and land transport.
“Land transport is incredibly critical for New Zealand,” Tighe-umbers says.
“We take it all for granted, just like we do with air connections while it’s all working, but as soon as you put up a border at the bottom of the Bombay Hills (as happened during Covid lockdowns), suddenly goods stop getting delivered.”
As the economy grows and supply chains get busier, it would be more important to get regulatory settings right.
“You’ve got to enable your strategic supply chain to be able to keep operating smoothly and if you stuff that up the whole economy pays.”