Kiwi Regional Airlines considers crowdfunding $2m for new plane
Kiwi Regional Airlines CEO Ewan Wilson says he is "seriously thinking about" a crowdfunding initiative.
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Kiwi Regional Airlines is considering trying to raise $2 million to buy a second plane through crowdfunding.
The airline currently flies from Dunedin to Hamilton, Nelson to Hamilton, Dunedin to Nelson and Nelson to Tauranga. It is due to begin servicing Christchurch in May. A route between Dunedin and Queenstown was abandoned shortly after the airline was launched.
Chief executive Ewan Wilson told Mediaworks' Paul Henry programme he was "seriously thinking about" a crowdfunding initiative. Mr Wilson said a second plane was needed to cover both planned and unplanned engineering work. The plane would not be used to add more routes.
"We've identified a very lucrative freight and passenger charter market so what we're not doing with the second aeroplane is wanting to add any more capacity ... We believe there is considerable capacity for us to develop in the charter area." Wilson said.
No website has been set up to handle the crowdfunding idea, which Wilson said was currently only a "discussion point." He said the rules had been changed and the company was keen to have New Zealand backers.
"The Financial Markets Authority changed the legislation a year ago and New Zealand has in fact led the world enabling small investors via a crowdfunding platform to be involved with equity in companies. So for us it's not the $2 million because $2 million in the aviation sense is not a huge amount of money but what we're really interested in is in a community of New Zealand shareholders because we think that has a great deal of appeal."
However, potential investors were also warned about the industry, which is very competitive. Mr Wilson told Mr Henry that backers should consider their investment carefully: "Don't go into it lightly. It's the riskiest industry there is."
Mr Wilson previously ran Kiwi Travel International Airlines, which failed in the mid-1990s.
In December, 2 Cheap Cars, which held a stake in Kiwi Regional Airlines, said it was looking to sell its shares, saying it "never intended to be a long-term investor." The nationwide chain of car yards had initially owned 23% of the airline, but that shareholding has been diluted repeatedly when the company issued more shares. Nicole and Guy Domett, former directors and shareholders of the New Zealand School of Tourism, each individually owns 33% of the airline, while Mr Wilson owns just over 20%.
(BusinessDesk)
Edwin Mitson
Tue, 08 Mar 2016
Tue, 08 Mar 2016
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Kiwi Regional Airlines considers crowdfunding $2m for new plane
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