26 August 2012

Nationwide Air - Airline and Car Ferry



Nationwide Air had two distinct parts to its history, the airline operation that arose from the takeover of North Island operators Air North and Akarana Air, which provided the licences for the company to morph, through a legal loophole into the short lived Haulaways Corporation car ferry operation.  

Background to the Car Ferry Operation  

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, NAC, Mount Cook Airlines, Safe Air, the New Zealand Shipping Corporation, the Railways Department, and the Union Steam Ship Company, could undertake the carriage of cars for 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 The application was withdrawn and when no objector was able to provide a satisfactory service Haulaways Corporation entered into negotiations with Air North and Akarana Air into those two operators offering a service and with a view to Haulaways taking over the shareholding of both companies. This happened in January 1978.  

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.” The replacement aircraft notified by Air North and Akarana Air were ordered and the company advised the Licensing Authority it 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 birth of Nationwide Air, the Airline 

In 1978 Air North was having increasing financial and operational difficulties with many complaints being made about the company’s service. On the 19th of June 1978 Air North changed its name to Nationwide Air Limited reflecting its association with the Nationwide Transport Ltd group of companies that specialised in the freight and air forwarding business. The licence remained under the Air North name but a Nationwide Air timetable was issued and advertising carried the new name. De Havilland Heron ZK-EKO was repainted in Nationwide Air colours, this being the only aircraft operated by Air North that was repainted. 


Newly painted in Nationwide Air colours, Heron ZK-EKO at Ardmore on 30 July 1978.
The Nationwide Air timetable effective 10 July 1978

The arrival of the Carvairs

In 1978 two Aviation Traders Ltd ATL-98 Carvairs were bought for $850,000 (including spares). The Carvair was a conversion of the Douglas DC-4 developed by Freddie Laker's Aviation Traders (Engineering) Limited and used specifically for a car ferry. The Carvair was able to carry up to seven cars as against the two-car load of Safe Air’s Bristol Freighters. The purchase involved Credit Finance Corporation, Kuwait International Finance and the Bank of Credit and Commerce International of Luxem­burg. The aircraft were refurbished in Singapore before the first, ZK-NWA (c/n 42994/ATL.98/20), arrived in New Zealand on the 17th of September 1978. The second Carvair, ZK-NWB (c/n 27314/ATL.98/21), arrived on the 28th of November 1978. It was reported at the time that a Convair 440 that was to be used for freight runs to Auckland, Rotorua and Gisborne had been purchased but this never made it to New Zealand shores 


My only picture of a Nationwide Air Carvair - taken on my new second-hand Praktica camera - still at school and saving for a 135 mm lens! Photo taken at Christchurch in January 1979.
First Day Cover for Nationwide Air's inaugural Carvair service, 8 November 1978

Despite the arrival of the first Carvair the launch of the car ferry service remained under a cloud. The Air Services Licensing Authority had deemed Nationwide’s tactic of changing the aircraft type on its licence illegal. Nationwide Air contested this move by appealing to the Supreme Court and in this interim time the car ferry service got airborne in a time which was, ironically, while the central North Island airline division of Nationwide Air was grounded. The Railways department also filed an injunction against the airline in the Supreme Court claiming the service was materially injuring the Railways. 

The first flight was from Wellington to Christchurch on the 8th of November 1978 and was flown by Carvair ZK-NWA. 12 vehicles were flown to Christchurch on two flights for the New Zealand Motor Corporation. By the end of the first week the company had built up to three flights a day between Wellington and Christchurch and on the 14th of November 1978 the company flew its first service into Nelson from Wellington. It carried four cars and general freight inwards and left with six cars and freight. The Nelson service operated on Tuesdays, Thursdays and Saturdays but the company's managing-director, Mr Matthew Thompson, told the Nelson Evening Mail that “it should shortly be a daily service.” Cars were also flown to Blenheim, though often there was little return freight from there.


Nationwide Air’s first flight to Nelson, 14 November 1978. Photo : Nelson Evening Mail

Financial Difficulties

The airline division’s financial difficulties worsened when it fell into arrears in its lease payments to Rotorua Airlines (1977) Ltd, Ian Palmer’s company that leased Nationwide Air a Heron and Aero Commander 500, so Palmer repossessed both aircraft.

Northern News, 5 October 1978
Meanwhile the airline was losing its battle to stay airborne. On the 17th of October 1978 a member of Nationwide Air's Auckland staff verbally informed the Licensing Authority that the company was not operating any scheduled services. This suspension of the airlines services lasted some six weeks. The airline resumed operations in late November with a reduced, on-demand service.

There were also financial troubles with Haulaways Corporation, Nationwide Air’s parent company, which was placed into receivership on the 29th of November. The local media were told by the Bank of Credit and Commerce International’s representative, Mr K. E. Mirza, that  “The group is not being put into liquidation, the move is being made to protect all creditors.” The three financiers had lent Haulaways $2.8 million under two debentures. Mr Mirza expressed his confidence that the company could trade out of its difficulties. Within a matter of days, however, a petition to wind up Nationwide Air was presented to the Supreme Court by Eagle Airways. The petition was supported by Truck Maintenance and Services Ltd, of Wanganui, Bob Jones and Co and the district commissioner of Inland Revenue. This happened on the 6th of December 1978 but the winding-up petition was adjourned for a week so creditors could be given details of a proposed settlement scheme.

It seems, however, that the airline division ceased flying about this time and Nationwide Air’s routes passed to other operators. The Auckland Aero Club took over the Auckland-Kaikohe service, Mount Cook Airlines was granted the right to operate an Islander between Auckland and Rotorua, Air Central was granted the right to add Rotorua to its existing Gisborne-Hamilton route, Bell Air Executive Travel Limited picked up a Whakatane–Auckland service and Eagle Aviation the rights to operate a Hamilton-Auckland service.

The other piece in the airline puzzle was Akarana Air Ltd. In October 1978 it changed its name to become Nationwide Air Akarana Limited though Akarana Air continued to operate under its own name. The new company was one of Nationwide Air’s creditors to the tune of some $116,000. This placed it under financial stress and it was placed in receivership itself on the 13th of March 1979. Some reorganisation enabled it to continue to operate its Auckland-Wairoa air service for some weeks. Wairoa-based Cookson Air took over the service to Auckland on the 4th of May 1979 and Nationwide Air Akarana Ltd was wound up on the 9th of May 1979.

The Phoenix Flies Again, Briefly

The car ferry, however, became airborne again on the 14th of December after a $150,000 cash injection. A new company Nationwide Air International was incorporated on the 18th of December 1978. This company was backed by six businessmen including Nationwide's Air managing director, Mr Matt Thompson, and a director, Mr John Rutherford, of Christchurch. The new company enabled the car ferry operation to continue. It chartered both Carvairs from the Bank of Credit and Commerce International which had put Nationwide Air’s parent company, Haulaways Corporation, into voluntary receivership. With Nationwide’s financial uncertainty fuel companies insisted that fuel had to be paid for on uplift. Despite the cash injection the car ferry struggled and it finally ceased operating in the last week of April 1979 having lost some $200,000 on its four and a half month car ferry operation.

Simon Gunson, a Nationwide Air employee, recounts, "The problems for the car ferry began when ZK-NWB lost a con rod on the No.1 engine smashing the crank case flying to Christchurch. The only spare engine held at Wellington had seized-up. An effort to procure a replacement engine from Papua New Guinea also fell through when the company's manager suffered a heart attack in Port Moresby. This effectively meant that from May to July the airline was only flying with one aircraft and could not satisfy it's customers, nor keep up with debts. I believe some contracts were lost when we were reduced to one aircraft." Nationwide Air International flew their last flight on the 16th of July 1979 with ZK-NWA.  

Carvair ZK-NWA was flown to Nelson by the end of July 1979 and was parked up in Nelson, with ZK-NWB arriving in Nelson in September 1979. Various attempts to restart the service were to no avail.


Carvairs in storage... ZK-NWA (above) and ZK-NWB (below) at Nelson on 3 December 1979. 
 

2 comments:

  1. I worked for Nationwide Air International on their Carvairs during 1979 up until their last flight on 16 July 1979. The problems for the car ferry began when ZK-NWB lost a con rod on the No.1 engine smashing the crank case flying to Christchurch. The only spare engine held at Wellington had seized-up. An effort to procure a replacement engine from PNG also fell through when the company's manager suffered a heart attack in Port Moresby. This effectively meant that from May to July the airline was only flying with one aircraft and could not satisfy it's customers, nor keep up with debts. I believe some contracts were lost when we were reduced to one aircraft.

    I recall that we were actually able to take cars across Cook Strait for less than Ferries charged.

    Most of the cars flown however were for NZ car assembly plants. Former ZK-NWA was refurbished beautifully by Brooks Air Fuels in 2010, but then crashed undershooting a short strip in Alaska. ZK-NWB went to South Africa where it operates as Pheobus Apollo. It now sits
    derelict near Johanesburg.

    Simon Gunson

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