31 January

NZForex, a sponsor of Aviation New Zealand, provides foreign exchange services across 6 continents. Jan Borgelt-012

Today’s introduction comes from International Payments Specialist Jan Borgelt, who reflects on the Reserve Bank’s announcement yesterday to keep the official cash rate at 2.5%.
When we look into the accompanying statement it is clear the RBNZ is very close to pulling the trigger on the OCR. They site:

Strong consumer and business confidence
A rise in consumption and household demand
A housing shortage which has seen a rise in construction activity with a high risk that rising construction costs will feed through to the broader economy adding to inflationary pressures
An annual CPI inflation rate of 1.6% in 2013 with an expectation this will continue to rise towards their 2% target
A 3.5% rise in GDP over the year to September – economic growth is expected to continue at around this rate over the next year too

The Reserve Bank did balance this rather hawkish assessment of the N.Z economy with comments about expecting agricultural export prices to come off their peak and uncertainty about the timing of the withdrawal of the US stimulus package and its effects, especially on emerging markets.
On the exchange rate they continue to try and talk the value of the Kiwi down saying it does not believe “the current level of the exchange rate is sustainable in the long run”.
In summary

There is a need to return interest rates to more normal levels
They expect to start this adjustment soon
The scale and speed of the rise depends on future economic indicators

Currency Outlook
When assessing the outlook for the Kiwi dollar there are many factors to consider both domestically and internationally. Rather than comment on them in detail, at a high level, as we see it:

USD/NZD
The USD is likely to continue to strengthen, keeping a lid on the Kiwi on any rallies to 85 cents. It will be difficult for the recent range between 0.8100 and 0.8500 to break but we feel, despite interest rate rises this year, the main risk is for the NZD/USD to eventually break (most likely in the second half of the year) below 80.

AUD/NZD
In just over 3 months the AUD/NZD cross rate has fallen from 1.1580 to trade below 1.0500, a 10% gain in the Kiwi. Most of the work though has been done by a weaker Aussie dollar. The combination of a weaker Aussie and sideways Kiwi is likely to continue. With the AUD/USD heading below 85 cents a rate of 1 for AUD/NZD is a real possibility by mid-year.

EURO/NZD
The rate has been trading sideways in the range 1.60 to 1.66 and we expect this to continue.

This is a very brief outlook. The environment is dynamic and we can provide much more detailed company specific advice.

I wish you all every business success in 2014.
Jan Borgelt

Editor’s note – we say a very big farewell to Derek Williams of Superair who after 60 years in the aerial applications space is retiring today. We also extend our condolences to Bev Webb wife of our President who recently lost her father .

Member "must knows"
Protecting and Enhancing your interests
Telling Our Story
Growth Opportunities
Value ADD for members

Member "must knows"

A break through with CAA on medical matters – contrary to what some are saying in circulating emails, we are focused on getting the problem of these OTT charges resolved. We attempted the petition route which, if granted, would have given a competitive alternative product provided by CASA. As you know this was declined but after some good old jaw boning, its now back on the agenda click here for our letter and the Director’s response:

Thank you for the attached letter regarding the possible recognition by NZ CAA of foreign medical certificates. As you know the current Civil Aviation Rules only provide a very limited ability to do this associated with:

the issue of a validation permit for a foreign pilot licence; or
the issue of a NZ Private Pilot Licence where the issue is on the basis of a valid foreign pilot licence.

As expressed in my letter (DW1257209-0 dated 5 Feb 2013) in which I declined the AIA’s 1 Nov 2012 application for an exemption from the requirement to hold a NZ medical certificate for any pilot holding an Australian medical certificate, there are significant public policy issues involved in the blanket recognition of foreign medical certificates.   Nevertheless, I think that there is merit in investigating the issue further and have initiated a policy project to do so.    My intent is that project reports to me in April 2014 in time to influence the CAA’s submissions to the Ministry of Transport on the content of the 2014/15 Civil Aviation Rules Contract if that is appropriate.
Regards
Graeme

1080 it’s a precision business - NZHA and AAA have come out fighting on this issue supporting DoC, Fish and Bird and expert comment on the aerial application of this substance. This is in response to uninformed nation wide comments on TV by certain groups who want the conservation estate protected exclusively for their own use click here

Industry Training and Apprenticeship Training Bill – this week Aviation New Zealand appeared before the Science and Education select committee.

In summary we are largely supportive of government proposals except in so far as they change the role of ITO’s and add some attendant governance and quality assurance compliance costs. In our view and those of many others, this Bill assumes that government agencies know more about quality assurance and good governance than industry itself – this is a big leap of faith. The down side, if the Bill proceeds, is we end up paying for another agency to provide more QA over the governance activities of our already highly competent ITO, ServiceIQ, and we end up paying more for no value add.

The committee has undertaken to look at our concerns re the changed wording to employment agreements which may or may not exclude the sole trader contract scenario which many of our apprentices are presently engaged under.


New product – Lift pod - available in New Zealand – the safest piece of kit for those undertaking aerial maintenance and overhaul. Demonstrated in this YouTube clip https://www.youtube.com/watch?v=bBEqbWVfMIA

The LiftPod Model FS80 has a platform maximum height of 2.32m giving an effective working height of 4.32m. Platform Capacity is 150kgs. The base width on this model is 1040mm and the unit has a total weight of 63kgs. Assembly time (once you’ve got a bit of practice in) is claimed to be 30 seconds (we manage about 40 seconds but are still learning). The current investment for the JLG FS 80 LiftPod would be NZ$4,000.00 + GST ex-stock Auckland C/W LiftPod Powerpack

They require a Safety Certificate (which we organise) and a test and tag which is done 6 monthly. These are passed on at cost.

The unit meets or exceeds the requirements of AS/NZS1418-10:2011

Speak to Alan at alan@independentsigns.co.nz Ph 03 347 8690 - Fax Ph 03 347 8691

“Easy Rider” – the trial continues. One of the interesting revelations was the very different safety management and licensing systems being operated by main stream commercial aviation although when you think back to a very recent accident in the adventure aviation sector there are some close parallels. For us, the big question is: will we see more of this type of litigation – I know many of you say to me in these scenarios companies deserve the book thrown at them but remember, in this instance, it is the surviving spouse that is on trial – a very salutary message for small “mum and dad” firms.

Parliamentary Questions New Zealand Air Force—Purchase of American Aircraft click here

Protecting and Enhancing your Interests

Consultations open

3 February 2014 National Airspace and Air Navigation Plan submissions due

Mid Feb the first phase of submissions on potential changes to the Civil Aviation Act will close. MOT will then circulate a consultative document, post consideration by Ministers.

7 March GD on Colour Vision - submissions now due 7 March. Delay due research on CAA's policies of earlier decades

Telling Our Story

Conference 2014 – Napier "Practical, Innovative, Professional – New Zealand’s aviation industry”

Update AEANZ composite structures and aging aircraft programme to be held 20-24 July (click here) for more detail – these are highly successful courses and were well attended last year

Event key dates:

NZAAA 20-22 July “Pilots in perspective”
AvNZ AGM 23 July 10.00am
Young peoples’ aviation expo 23 July
All other divisions PM 22 July to 24 July
Welcome Social’s Valley D’Vine
Wrap up gala event 24 July – Napier Convention Centre

Venue – Napier War Memorial Convention centre

Hotel bookings click here – Te Pania is across the road – 1 minutes walk from the conference centre and the Viceroy’s a 5 minute wander through the beautiful art deco city of Napier

Trade bookings click here a big thank you to HAI in the US for being our first paid trade registration. They have their booth reserved.

Sponsorships click here – essentially the total sponsorship amount ensure conference operates at a profit so it is critical we get those contributions flowing in

Speaking opportunities for product or product launch email us directly. Unless you are a sponsor or involved in our trade display there will be an up front charge of $750 plus GST to speak for 15 minutes.

Delegate Registration coming soon, prices held at Dunedin’s standard rate.

AIRCARE™ - congratulations to three companies which have reaccreditation confirmed: Wanaka Helicopters, Reid Helicopters and Precision Helicopters. Just a quick reminder; accessing our programme at member rates requires payment and on-going membership of the organisation. If you do not pay the membership subscription then we can’t issues the accreditation certificate.

Membership endorsement of codes of practice – we invited you last week to provide feedback on the issue of codes regulation so that we could clarify your views with Minister Smith. Well, from the feedback so far, we’d say that industry prefers industry developed and industry lead codes over regulatory intervention but does recognise in certain specific instances (e.g. drugs and alcohol, safety management systems) that the State should intervene and regulate. Please keep on feeding back your view

Growth Opportunities

Productivity Council – the work on Regulatory Institutions and Practices is progressing and its good to see aviation had its fair share of submitters. We’ve previously circulated Aviation New Zealand’s submission and now attached is submissions from Air NZ click here, Airports NZ click here, BARNZ click here, CAA click here, MOT click here, Maritime NZ click here

The American Association of Airport Executives is having its international conference at the Intercontinental Hotel in Wellington from 10 to 12 February. There are a number of international and New Zealand based speakers. Conference participants are coming from North America and Australia – a real mix of government, airport management and airport suppliers. For more info: http://events.aaae.org/sites/120203/index.cfm

This week we met a government delegation from Thailand to talk about the structure of the aviation training industry in New Zealand. The visit, organised by Education NZ, was looking at training in a number of sectors in New Zealand. CAA and ASPEQ participated in our meeting and the group also met ServiceIQ. Some interesting prospects in commercialising what we do in New Zealand.

Next week we’re with a small government delegation from Indonesia. This is a follow on to the mission we ran with NZTE in Jakarta last May and some other educational work undertaken by NZTE, with industry input, in Jakarta in November. We see strengthening government to government ties unlocking more commercial opportunities. In this context, it has been great to see the commercial successes that have resulted from that May visit to Indonesia, and the actions underway by some companies to generate more business.

Value add for members

Southern Cross medical assurance - we will be announcing a package agreement within the next fortnight focused at businesses and provision of subsidised health care. If you’re interested in being first on the list, let us know – the deal is very worthwhile!!!!!

AIRCARE™

AIRCARE™ ACCREDITATION process read here

AIRCARE™ accreditations Click here

Products

Aviation Safety Supplies Ltd have released a new product, a low cost Iridium Tracking Device
For more info see http://www.beacons.co.nz/iridium-tracking-device-xidc104368.html

Get a GO FUEL fuel card and get *8 cents per litre discount off pump price on Petrol and Diesel

Just click here and complete a form or call direct and we’ll complete it for you

Get going - go to gofuel.co.nz

N3 Trade Card click here - if you are a member and you haven't got your card let us know. The savings more than offset membership costs.