Ports of Auckland chief executive Tony Gibson, who has recently signed an alliance with the Port of Napier, explains why he pursued an alliance solution.“Alliances between ports are particularly important in New Zealand, where we have a small population spread thinly across a long, skinny island. Land transport is expensive so the supply chain needs to be fully optimised to keep costs low.

“This means eliminating unnecessary landside moves, ensuring the fronthaul and backhaul legs are full and making the best use possible of coastal shipping. Alliances between ports in New Zealand, combined with strategic investment in inland freight hubs and smart use of technology to ensure the most efficient utilisation of transport between ports, hubs and customers, is how we aim to achieve this.”

Mr Gibson says that internationally, alliances between ports or terminals may help achieve similar efficiencies and help avoid the current situation where changes in carrier alliances are causing significant falls in volumes at some ports.

“On the other hand, alliances are not a magic bullet if there has been an over-provision of port infrastructure and there is simply too much capacity. In the latter case, there may be some ports which have to scale back or close.“What we all have to do in this new world where high growth rates appear to have disappeared forever and where technology may have a significant impact in the future, is examine our business models and really honestly ask ourselves, ‘is the way we’re working now going to work in the future?’.”

MORE TO COME FROM AUCKLAND-NAPIER ALLIANCEA relatively low-key “collaborative alliance” between Ports of Auckland (PoAL) and Port of Napier could be the first stepping stone to a new level of competition between the major ports of New Zealand.The alliance ushers in an agreement to work collaboratively to save backroom technology costs in things such as terminal management systems (both use Navis), cut costs when bulk buying from common service providers, exchange staff training and expertise and share the talent pool where possible, share best practice in sustainability practices and benchmark in adapting to new health and safety laws

However, it is a possible forerunner for a strong alliance being set up to challenge the Tauranga/Timaru pairing. There is a “natural fit” between the businesses – Auckland is import-dominant and Napier is export-dominant.

So possibly, there is a supply chain solution whereby an import box comes into Auckland, moves to the central North Island Longburn inland port (where both Auckland and Napier have an investment) and the empty is made available for export through Napier.

Napier requires empties for its export moves and in peak fruit export season, where Napier could be stretched to handle more volume, Auckland would be available as an alternative for export moves.

The two allies are believed to be looking at a possible third partner in the South Island, given that Tauranga is firmly established in the South Island through shareholdings and operational agreements in Timaru.

A PortStrategy release