Airways signs big US air traffic deal after reporting record year
State-owned air traffic controller Airways New Zealand has signed a "very significant" deal with the US Federal Aviation Administration to use New Zealand-developed technology to pre-screen potential recruits for the demanding roles required of air traffic managers.
The five-year contract will earn taxpayer-owned Airways NZ around $1 million a year and is the first of what chief executive Ed Sims hopes will be many sales of the technology to aviation services around the world.
At the same time, Airways has announced a 54% jump in annual profitability to $23.2 million for the year to June 30. This was achieved on total turnover that rose 10% over the year to $205.1 million.
The SOE announced in May it would be reducing its fees to airlines by 4.7% over the next three years due to the increase in air traffic.
Mr Sims says he expects the volume of business will continue to increase into the next calendar year but this rate of growth will be hard to sustain given supply constraints.
The FAA will Airways' SureSelect system in a major recruitment drive spurred by the strong global growth in air travel created by growing Asian middle classes, lower transport fuel costs and the spread of budget carriers.
Because of the rare combination of personality traits and aptitudes required to be an air traffic controller, only around 3 percent of the general population will ever make the cut.
SureSelect has "the potential to save the air traffic control industry millions in training costs by finding the right people from the outset," Mr Sims says.
"Around $US480 million is spent globally on ATC training every year and about 30% of this, or $US143 million, is spent on candidates who fail to qualify."
Mr Sims says the deal is a major step in the SOE's efforts to build a new commercial services arm to its primary business, which is to ensure the safe management of air traffic to and from New Zealand and in the country's skies.
"This deal with the FAA cements Airways' reputation as a global leader in the air traffic control industry," he says.
More deals in pipeline
The two agencies have worked together extensively on other projects "but this is the first time they've reached out and said 'we need some help'. It's great that they reached to another ATC rather than a traditional software provider.
"An organisation like the FAA is working in the world's most congested air space and they are confident they can hire great people," making the SureSelect deal a vote of confidence in the New Zealand-developed product.
Because of the special characteristics of New Zealand's airspace, including varied terrain and ocean surroundings, New Zealand ATCs went through "more demanding initial pre-screening than many other parts of the world," Mr Sims says.
The Airways system builds selection patterns based on some 18 psychometric and spatial reasoning tests.
Airways is also in talks with aviation authorities in other countries about licensing use of SureSelect and Mr Sims hopes the FAA deal will be "the first in a long pipeline."
Airways is targeting a doubling of its commercial services sales, as distinct from its airspace regulatory activities, over the next five years or so to around 25-30% of total annual revenues.
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