Ports of Auckland eyes southern markets

By Phil Boeyen, ShareChat Business News Editor

Thursday 8th March 2001

Ports of Auckland (NZSE: POA) is aiming to capture a greater slice of the container market in the lower North Island with a new rail service to Palmerston North.

The port company says it has reached agreement with Tranz Rail to transport import and export containers between Palmerston North and Auckland via a POA-owned rail service.

Under the agreement POA will invest up to $5 million for a daily dedicated rail service that it will fully own and control. The port's specialist container division will own its own rolling stock, and Tranz Rail will operate the service under contract.

There are plans to have at least one dedicated daily return service between Palmerston North and Ports of Auckland.

Ports of Auckland boss, Geoff Vazey, says the development will result in a change in transport logistics for export containers in the North Island, as well as for import and empty containers.

"This initiative will significantly reduce the total cost of transporting export containers to world markets, and for import containers destined for the lower North Island.

"Exporters in the lower North Island will now be able to take advantage of the multitude of liner services operating out of Auckland to get their products to major international markets more frequently."

Mr Vazey says the dedicated rail service from Palmerston North will enable Ports of Auckland to achieve operational efficiencies, lower costs and increase container volumes handled at Auckland.

He says until now, New Zealand's geography and domestic freight costs had created a barrier for shipping lines that wanted to hub their operations on Auckland, rather than incur the high cost of multiple calls at regional ports.

The port company is initially targeting around 50,000 containers a year for the new service, which is due to begin operating before the middle of the year.

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