With the new vehicle market in an unprecedented positive state, selling product is easy – landing it in New Zealand? That’s turning out to be the (increasingly) hard part.
“We’re used to turnarounds of two to three days – not two to three weeks.”
This is Holden New Zealand boss Kristian Aquilina talking about the biggest problem the new vehicle industry is facing at the moment. An issue, he says, that is growing by the day and demands Government to remedy.
It’s the story of how the Port of Auckland, into which more than four in every five new, parallel and used import vehicle is transhipped, has become so overwhelmed by the traffic that it has become an international talking point.
Aquilina is more than a little frustrated that the giant car carrier vessels that come here from all around the globe are sometimes spending almost as long waiting to unload as it has taken them to steam here.
Some weeks the ships are stacking up like taxis off our biggest city, not least when several arrive around the same time.
When speaking to MotoringNetwork he claimed: “We’re lucky even to get vehicles on the dock at the moment. There’s vehicles on ships behind Rangitoto Island, waiting for some space to offload onto a wharf.”
Obviously, schedules are being blown out of the water.
He says its certain some of his customers will be steaming, too and, in all likelihood, his dealer network could well have seen some abdicate purchase undertakings.
“In an ideal situation, which we have enjoyed, it will take around 48 hours to get a car from a ship into our compound or even to a dealer. Now it’s taking multiple days and, in periods of heavy congestion, it could be weeks.”
The glacial pace of the simple action of unloading a ship in Auckland and progressing it through into a holding yard then releasing it for New Zealand market use – a movement that, in respect to the distance the vehicle will move, it is probably the shortest journey it will take since reaching our shore – is not simply an issue for Holden but every new vehicle distributor.
They are all – quite literally – in the same boat.
Aquilina says there’s just one way to fix this: “We need a national plan centred around port infrastructure.
“New Zealand is the only developed economy in the western world that I know of that doesn’t have a national port solution, and for an island nation that’s pretty remarkable.
“So, I think it’s time for central government to step up and get involved in the major infrastructure such as ports. I’m not talking selfishly about cars because it’s a problem that goes way beyond just those.
“It’s great to be part of a growing economy and new vehicle market, but it brings its challenges with the ability of the available infrastructure to cope with such growth,” he says.
“It’s a compounding of a growing new vehicle market, and also used vehicles coming in high numbers as well, to feed the domestic market here.”
“But we need a national strategic plan … it’s all been left to the relevant councils and ports companies to fight it out for themselves. It’s such an important piece of infrastructure … this is an island nation and, let’s face it, we rely heavily on our ports here.
“There’s an opportunity to have one single national strategy here and the Government doesn’t seem to want to jump into that.”
The ports of Wellington and Lyttelton also tranship vehicles, but in much lower volume than Auckland. And earthquake damage in the Capital and Canterbury have not made it any easier through those lesser entry points.
“Wellington has its own issues since their (November, 2016) earthquake which is causing capacity concerns there and Lyttelton can only grow so fast.
“To put some figures on it there were about 170,000 vehicles come through the port of Auckland in the 2012-13 year, this year it will go over 300,000 – a 75 percent increase in that short period of time and there’s still no real overall strategy about we get those cars into the country.
“It’s knocking schedules about which is a problem for the shipping companies about as well as us … and when you start adding up the cost of all of this, the delays and the inefficiency of it, it ultimately ends up costing consumers.
“It’s becoming quite a difficult thing to predict from a cash flow perspective, that’s probably the biggest concern … in regard to the economic cost of delays which we are seeing now? It’s hard to put an actual number on it but, yes, we know it is costing us.”
Is Holden losing customers? “Yeah, I think we are … what it’s doing directly is causing frustration for our customers, especially when they can see a vehicle has landed on the wharf … and then it might be a matter of weeks (before it is delivered).
“The frustration comes about when it is left up to the Port of Auckland and, indirectly, the (Auckland) council to sort it out and find a market-based solution.
“When it comes to a massive piece of infrastructure like this we at Holden believe it needs a national strategy, led by Government – just as it does with the road system, the rail system and the air system. This one shouldn’t be left.”
Since Aquilina has made his comment, Ports of Auckland has responded to another publication, suggesting that while the Holden NZ CEO makes some good points, the current wharf congestion is a whole supply chain issue and not simply about port infrastructure.
The potential of a car handling building, more investment in more trucks and drivers to get cars off the port, opening compliance centres and dealers for longer hours to accommodate the ongoing demand, as well as working with shippers to smooth the incoming supply are also being looked at. But no quick fixes are in hand.