Air North - Big enough to serve, Small enough to care

Air North had its origins in the Rotorua Aero Club. The development of the company was recounted by Ian Palmer in NZ Wings in August 1976 who said, "The idea of forming some sort of airline really came more as an outcome of circumstances than as a brain wave by anyone. We were getting a fair amount of charter work after taking over some of the licences of James Aviation (Rotorua) Ltd so it was decided to separate this facet from the rest of the club activities and form Rotorua Aerial Charter. We were getting good work from all sorts of people - forest fire patrols, scenic work, photography, plus a lot of passenger charters so the proposition was more or less forced onto us. But the commercial flying grew faster than the club flying, so it was decided to form a company to take over the commercial activities which we had provided in the name of Rotorua Aerial Charter. The club committee asked me to organise the company, and in March 1969 (seven years after I joined the aero club!). Geyserland Airways commenced operation as a private company.” Shareholding in Geyserland Airways Limited was initially held by Ian Palmer, Fred Ladd and Sel Goldsworthy. Palmer had a majority shareholding and it was very much ‘his’ company. Fred Ladd sold out after a relatively short time. Ian Palmer continue his account; “Initially our fleet consisted of an Aero Commander 500 ZK-CWP and two single engine Cessnas, including a floatplane. Geyserland Airways progressed well over the next few years, and we added two Grand Commanders (ZK-DBQ and ZK-DHF) and another Cessna 185 floatplane to the fleet. But already we could see conflict arising with the varying nature of the work we were doing. I was more keen on the passenger services, which were becoming regular, but this wasn't really synonymous with our floatplane operations, nor the jobs for the various Government departments that we were still doing. So in 1972 I formed Air North Ltd.”

On the 30^th of May 1972, the Air Services Licensing Authority approved the scheduled operations of Geyserland Airways Ltd being passed to a new subsidiary company, Air North Limited. This was a limited liability company formed by two shareholders, Ian Palmer and Selwyn Goldsworthy. The initial capital of the company was $10,000 of which Palmer held 9000 shares and Goldsworthy 1000 shares. Both men also held the shares of Geyserland Airways Ltd in similar proportion.

NZ Herald, 13 December 1973

At this time the company was operating two routes, Rotorua to Auckland and Kaikohe with a minimum frequency of six return flights each week, with the right to set down or pick up passengers, as needed, at Kawerau and Matamata and from Rotorua to Gisborne with a minimum frequency of six return flights each week with the right to set down or pick up passengers at Kawerau if traffic was offering. Air North was initially licensed to operate one Aero Commander 500, ZK-CWP (c/n 500-842-97), and one Aero Commander 680FL Grand Commander ZK-DBQ (c/n 680FL-1330-15). Geyserland Airways continued to operate one Grand Commander on charter work and this aircraft, ZK-DHF (c/n 680FL-1429-71), was also used as a backup aircraft for Air North.

Aero Commander 680 ZK-DHF at Rotorua on 21 June 1973

 

 

In July 1974 Air North and Geyserland Airways applied to the Air Services Licensing Authority to further divide the Geyserland Airways and Air North. Geyserland Airways took over all the single-engined aircraft services while all the twin engined charter, air taxi and scheduled work passed to Air North. This enabled Air North to operate air charter and air taxi services from Rotorua, Galatea Kawerau, Whakatane, Matamata, Taupo and Turangi with an authorised fleet of one Aero Commander 500 and one Grand Commander 680.

Later in 1974 Air North became involved in forming another aviation company when it came together with the Auckland charter operator Akarana Air to establish Norak Engineering at Ardmore to carry out maintenance on both company's twin engine aircraft.

Disaster struck the company on the 23^rd of March 1975. Ian Palmer was flying Grand Commander 680 ZK-DHF to Cincinnati for servicing. While on the leg to Hawaii a fuel flow problem with the ferry kit forced the aircraft down in the sea short of Hawaii. After making a successful escape from the sinking aircraft, Ian Palmer spent about half an hour in the open sea before being rescued by the US Coast Guard. 



one Aero Commander 680FL Grand Commander ZK-DHF at Tauranga on 1 March 1975

 



The airline’s early years from its passing from Geyserland Airways to the mid-70s were good years for Air North with passenger numbers improving each year.

Year                         Passengers Carried

1971/72                                           9968     Increase 47% over 1970/71

1972/73                                         10752     Increase 8% over 1971/72
1973/74                                         14155     Increase 35% over 1973/73
1974/75                                         14936     Increase 5.5% over 1973/74

So, in 1975 Air North sought to extend its route structure by adding a Gisborne-Napier- Palmerston North service and a Palmerston North-Taupo-Rotorua service with both routes operating with a minimum frequency of 6 return flights each week. The company planned for the aircraft to leave Rotorua for Gisborne at 8.00 am before flying down the East Coast to Palmerston North and then up the centre of the North Island back to Rotorua. In the afternoon the reverse was flown with the aircraft arriving back in Rotorua at 5.45 pm.

The company was also sought permission to add a de Havilland 114 Heron to its fleet. The Heron was chosen in an endeavour to reduce operating costs. In its application the company stated it cost approximately $30 per hour to repair and maintain a Grand Commander with its geared or supercharged engines while the comparable cost for the Aero Commander 500, with its simple engine, was only $12.00 per hour. The four engined-Heron used a similar engine to the smaller Aero Commander and despite the fuel and maintenance costs of a four engined aircraft the company was confident that its higher passenger capacity would make it a more economical aircraft.

Pending the arrival of the Heron the Gisborne-Napier-Palmerston North-Taupo-Rotorua service began on 29^th of September 1975 using Piper Pa23-250 Aztec ZK-DUB (c/n 27-3528), hired from Bell-Air. In November 1976 de Havilland DH114 Heron 1B ZK-BBM (c/n 14011) arrived from Fiji and entered service the following month, initially being used on the Rotorua-Auckland-Kaikohe service. The Rotorua-Auckland service was Air North’s most profitable service, with up to five flights a day flown on the route.

Aero Commander 500 ZK-CWP at Palmerston North, the airline's southern most destination, on 30 January 1976.

 

Air North was very much Ian Palmer’s airline. Ian learnt to fly with the Air Training Corps, and was in the RNZAF from 1949 to 1956. Moving to Rotorua he worked for James Aviation on scenic and charter flights and for six years he was a topdresser pilot for James. In his spare time he ran the Rotorua Aero Club which he restarted and was the commander of the local Air Training Corps. He then became chief instructor for the Rotorua Aero Club and led the development of Rotorua Aerial Charter and Geyserland Airways. Under Ian Palmer’s ownership Air North was very much a family affair. The April 1976 issue of Wings reported, “Ian is the father of three burly sons, all of whom play some part in the day-to-day running of Air North. Ian's second son, John, runs the Rotorua airport office of Air North and looks after the airline's accounts. John is a pilot as well, with a rating on the Aero Commander 500 and with plans to obtain his CPL and an instrument rating. His younger brother Keith is the other full-time Air North man, running the Auckland office from where he handles all the bookings and despatching from that end. The third son, Brian, helps Ian's wife, Joyce, run the Rotorua town office when he's home from university.”

NZ Herald, 28 July 1976

In May 1976 following NAC’s reintroduction of a direct Palmerston North-Rotorua service the Air North sought approval to suspend its Palmerston North-Taupo-Rotorua service. The frequency on the Rotorua-Kawerau-Gisborne and Gisborne-Napier-Palmerston North services was also reduced from six return flights per week to five return flights per week.

 

An old NAC Heron returns - ZK-BBM in its new Air North colour scheme at Ardmore on 5 January 1976.

Earlier in 1976 NAC had announced it was withdrawing from some of its uneconomic provincial services and Air North saw this as an opportunity to expand. The company sought Air Services Licensing Authority to include Whakatane, Hamilton and Whangarei, when traffic was offering, as stopovers on its existing services and to also introduce a New Plymouth-Hamilton–Rotorua route. The latter would feed into the Rotorua-Gisborne service. In detailing its plans Air North proposed to commence and terminate its early morning Rotorua-Auckland and return evening service at Whakatane thereby retaining a same day return service to Whakatane people. Air North’s proposal to replace NAC’s Hamilton-Gisborne service was for a New Plymouth-Hamilton-Rotorua-Whakatane-Gisborne-Napier service. The aircraft would leave New Plymouth at 8.20 a.m. to reach Napier by 11.50 am. The return service would leave Napier at 2.00 p.m. to arrive back at New Plymouth at 5.20 p.m. The Licensing Authority ruled that Air North's application for the sector New Plymouth to Hamilton provided no independent evidence as to demand and in the absence of such evidence that part of Air North's application was not granted. The application to include Tauranga and Whangarei as stopping places not granted. The rest of the application was granted and Whakatane was added as a stopover from 5 June 1976.

Timetable 28 April 1976

Sadly Whakatane did not meet the company’s expectations and the service from their averaged only one or two passengers per trip and the Heron Air North originally used was replaced by the Aero Commanders on the Whakatane-Rotorua sector, much to the chagrin of the Whakatane town authorities.

Aero Commander 680 ZK-DBQ at Ardmore on 6 March 1976.

There were also problems with the Hamilton-Rotorua-Gisborne service. In October 1976, Air Gisborne Limited commenced operating direct air taxi services on a timetabled basis between Gisborne and Hamilton using aircraft leased from Air Central. Air Gisborne offered two return services on week days and one return service on Saturdays and Sundays and Air North’s passenger numbers between Hamilton and Gisborne immediately experienced a sharp downturn, people preferring Air Gisborne’s direct flights at more suitable times. To counter this Air North was given approval to operate direct flights on the 8th of March 1977.

Back on the 5th of July 1976 the Licensing Authority gave Air North approval to add a second Heron to its fleet and de Havilland DH114 Heron 1B ZK-EJM (c/n 14005)  arrived in September 1976. In addition the Authority approved Tokoroa replacing Matamata as a stopping place, when traffic was offering, on Air North’s Rotorua-Auckland services. This gave Tokoroa connections to Auckland allowing a full day in Auckland, as well a service as to Kawerau, Whakatane, Gisborne, Napier and Palmerston North. The Tokoroa stopover was not a great success and on 15 November the schedule was changed with the only a 10.45am departure from Tokoroa.

The second Heron, ZK-EJM at Ardmore on 26 December 1976.

Meanwhile, in February 1977 Air South Pacific Limited moved to take over Air North. Air South Pacific had been formed on the 2nd of April 1974 for the purpose of applying for an air service licence to run an air safari around New Zealand using a Beech King Air. The company was owned by Christchurch lawyer, John Rutherford, and a Rotorua surgeon, Arthur Hackett. Ian Palmer, the then Managing Director of Air North, remained with the company as chief pilot. On 21 March 1977 the licence was transferred to Air South Pacific Limited.

The takeover did not include all the Air North fleet. One of the Herons, ZK-BBM was transferred to the new company while Ian Palmer retained the other Heron, ZK-EJM, and the Aero Commander, ZK-CWP forming Rotorua Airlines (1977) Ltd to own these aircraft. Rotorua Airlines then leased these aircraft to the “new” Air North. The Grand Commander, ZK-DBQ, was sold to Akarana Air in May 1977. Air South Pacific changed its name to Air North Limited on the 2nd of June 1977 enabling the air service to be continued in its own name.

Repainted as part of the sale to Air South Pacific, Heron ZK-BBM in its striking colour scheme at Rotorua on 8 August 1977.

Disaster struck the company on the 9th of May 1977 when the second Heron, ZK-EJM, had a landing incident at Ardmore. The aircraft touched down far down the runway and swerved to the right when the left brake failed. It crossed a drainage ditch and came to rest with serious damage to the nose gear, propellers and both wings. Although the intention was to repair the aircraft, it lay derelict and was later broken up. A replacement  de Havilland DH114 Heron 1B, ZK-EKO (c/n 14044), subsequently arrived in New Zealand in June 1977.

The replacement for ZK-EJM, DH Heron ZK-EKO at Christchurch on 10 September 1977

 

By mid-1977 the company was struggling. The Rotorua-Kawerau-Whakatane extension and Auckland-Kaikohe service were proving to be uneconomic and the company was keen to develop night courier and freight flights when its aircraft were otherwise not utilised.

The Auckland-Kaikohe service experienced a drop in passenger loadings following Mount Cook Airlines’ introduction of its Hawker Siddeley 748s into Kerikeri in March 1977. To make matters worse, with Kerikeri becoming a private airfield Air North were prevented from using it. This was especially problematic for the airline during winter when Kaikohe’s grass airfield was often unserviceable due to water on the aerodrome or soft ground conditions. On these occasions the Air North service had to divert to Whangarei and the passengers were taken to and from Kaikohe by ground transport. Subsequently, the company applied to reduce the frequency to four flights a week and this came into effect in late August 1977.

NZ Herald, 2 December 1977

In late 1976 and early 1977 Kwikasair Limited had engaged Air North for a number of night freight flights between Christchurch and Auckland. To offset its loss making passenger services Air North sought contracts with a number of freight and courier companies for night freight services from Auckland to Wellington and Christchurch. Before the hearing, however, Air North merged with Auckland charter company Akarana Air which already had an extensive night courier service. Air North advised the Licensing Authority that much of Akarana's business related to the flying of courier freight at night and their aircraft were not utilised to any great extent during the day and that these aircraft would provide excellent backup for Air North’s scheduled services. The proposed merger envisaged that the two trading companies would continue as totally owned subsidiaries of a holding company and the licences and the assets of the trading companies would remain. In other words, the management of the two companies would be joined in a holding company which would administer the two trading companies. The two companies then set about adding each other’s fleet to their own licence.

The company’s woes continued. In August 1977 the company applied to sever both the Gisborne-Napier-Palmerston North service and the Gisborne-Hamilton route. The Company cited an average of only one passenger per trip on the Palmerston North service which was losing the Company at least $1,000 per week. The continuance of the Air Gisborne/Air Central air taxi service on the Gisborne-Hamilton route made Air North’s own direct service “completely uneconomic” with an average of only one passenger per flight. The Company was also finding its maintenance costs on the Heron aircraft were much higher than was hoped for, adding to the economic woes. The Authority gave Air North approval to suspend its Palmerston North service from the 1^st of September 1977 and Air Gisborne and Air Central were prevailed upon to cease joint air taxi operations between Napier and Hamilton. By late 1977 Air North was short of aircraft and from the 7^th of December 1977, Air North  entered into an agreement with Air Central to 'wet hire' one of their Cessna 402 aircraft to operate the daily return Gisborne-Hamilton service.

In January 1978 Air North’s John Rutherford wrote to the Licensing Authority advising them that they intended to replace the 10-seat Grand Commander 680 on their licence with an ATL98 Carvair with seating for 10 passengers and to replace the 16-seat de Havilland Heron, with a General Dynamics Convair 340 with seating for 16 passengers. At the same time Akarana Air wrote to the Authority advising them that they too intended to replace the 10-seat Grand Commander 680 in their licence with an ATL98 Carvair with seating for 10 passengers and to replace the 15-seat Beech 99 on their licence with a General Dynamics Convair 340 with seating for 16 passengers. John Rutherford told the Authority that “in the present economic climate where scheduled passenger traffic is moribund a freight supplement is essential to keep an appropriate cash flow. Further freight activities are clearly in the public interest in view of the withdrawal of coastal shipping services and increasing rail costs particularly in areas not directly served by NAC.” He further stated that a financial reconstruction of the company involving in excess of $2 million was underway and that “the new aircraft will be put into service as soon as all appropriate operations, airworthiness and type documentation is completed.”

Previously, in September 1977, Haulaways Corporation Ltd. lodged an application with the Air Services Licensing Authority as trustees for a company to be formed for air charter and air taxi services from Paraparaumu, Christchurch, Nelson and Wellington using two Carvair aircraft. The hearing was subsequently adjourned so the applicant could  ascertain whether the objectors to the proposal, including Safe Air and New Zealand Railways, could undertake the carriage of cars for the Haulaways Corporation. The application was withdrawn and when no objector was able to provide a satisfactory service Haulaways Corporation entered into negotiations with Air North and Akarana Air with a view to taking over the shareholding of both companies. This happened in January 1978 and the replacement aircraft notified by Air North and Akarana Air were ordered and the company was committed to the contracts which were firm orders.

The Licensing Authority, however, decided that the notice given by Air North Limited and Akarana Air Limited, if valid, would permit a practice which would enable the licensees to increase freight capacity without establishing necessity or desirability for the increase to the likely detriment of other licensed operators and it is in the public interest that the replacement aircraft should be substantially the same maximum payload capacity as the replaced machine. This, the Authority said, would prevent a substitution of an aircraft which has "equivalent seating capacity", but a cargo capacity considerably greater than the machine being replaced. An appeal was made to the High Court who ultimately confirmed the decision of the Licensing Authority that the notice given by Air North was not effective to bring about a replacement of its two light aircraft with two heavy aircraft.

The company was increasingly finding its financial state more difficult. It failed to pay Air Central for the use of their Cessna 402 which operated the Gisborne-Hamilton route and so on the 13^th of February 1978 Air Central applied to operate scheduled services from Gisborne to Hamilton. The application was opposed by Air North. At the hearing on 14 and 15 March a volume of complaints were heard as to the manner in which Air North has carried on its operations.

Despite these difficulties the airline continued operating throughout 1978. On the 19th of June 1978 Air North changed its name to Nationwide Air Limited and this marks the beginning of the final chapter of the Air North story.

 

For the Nationwide Air post see :

http://3rdlevelnz.blogspot.co.nz/2012/08/nationwide-air-airline-and-car-ferry.html

 

For a more detailed post on Air North's service to Kaikohe see : http://3rdlevelnz.blogspot.co.nz/2012/10/north-to-kaikohe-on-air-north.html

 

For a more detailed post on Air North's service to Tokoroa see : http://3rdlevelnz.blogspot.co.nz/2010/07/air-north-to-tokoroa.html