South East Air secures New Zealand Gov’t loan
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By Andrew Curran.
The New Zealand Government will lend NZD640,000 (USD376,000) to South East Air to help refurbish and return a Britten-Norman Islander to service after more than three decades on the ground.
South East Air, the entity behind Stewart Island Flights, is the only scheduled operator connecting Stewart Island, located off New Zealand’s South Island, with the mainland. It operates three daily round trips between Oban (SZS) on Stewart Island and Invercargill (IVC).
“This initiative continues the Government’s commitment to strengthen regional air services and support the vital economic and social benefits regional airlines bring to some of our most remote communities,” Associate Regional Development Minister Mark Patterson said.
South East Air has four operational aircraft, including two Britten-Norman Islanders registered as ZK-FXE (msn 100) and ZK-FWZ (msn 52); one Piper Cherokee Six registered as ZK-RTS (msn 32-7340070); and one Cessna 185 registered as ZK-JEM (msn 18501780).
However, the out-of-service Islander has dropped off the New Zealand aircraft register. South East Air CEO Leon Bax told Aero South Pacific that the aircraft, ZK-FFL (msn 614), was taken out of service in 1990.
"All Airframe components have either already been recently refurbished or are in the process of and reassembly will take place over the coming months," he said.
Loan will assist South East Air's operational resilience
Patterson says getting the third Islander back in the air means that South East Air will be better able to meet peak-season demand and ensure scheduled services can continue when aircraft maintenance is prolonged by unforeseen delays.
“It will also support island residents’ access to healthcare services and education, boost response times in an emergency, and help drive Stewart Island’s tourism, trade and general business activity,” he said.
The New Zealand Government has made NZD30 million (USD17.6 million) available to the country’s regional airlines, drawing on the NZD1.2 billion (USD710 million) Regional Infrastructure Fund following a sustained campaign by New Zealand’s smaller airlines for some form of support. Funding is available to eligible airlines via concessional loans.
Patterson says the money is designed to help regional passenger airlines manage debt, maintain their fleets and continue operating the routes important to the wellbeing, resilience and economies of regional communities.
South East Air becomes the latest regional carrier to tap concessionary government loan scheme
South East Air becomes the fifth airline to tap the fund. Almost NZD23.7 million (USD13.9 million) of the available funding has already been lent, with most of it — NZD17.2 million (USD10.1 million) — lent to Air Chathams, primarily to refinance existing debt.
Other borrowers include Sounds Air, which borrowed NZD4.5 million (USD2.6 million) to refinance debt and upgrade its fleet; Golden Bay Air, which borrowed NZD1.1 million (USD650,000); and Island Air, which borrowed NZD252,000 (USD148,000) for fleet maintenance. Other carriers, such as Origin Air, have not yet participated in the scheme.
Photo: South East Air.
Contact the writer: andrew@aerosouthpacific.com