Dunedin Railways mothballing trains and Taieri Gorge track

Dunedin Railways Limited had become mostly reliant on the tourist market, especially cruise ships, and with those stopping suddenly last month and probably for a year or more the DCC owned operatin has decided to probably sack 51 staff and put it’s trains and iconic Taieri Gorge track into mothballs.

ODT:  Taieri Gorge track to be mothballed, 51 jobs likely to go

In a statement this morning, chairman Kevin Winders said mothballing was a way of preserving DRL’s assets ”with a view to exploring future options for the company in what will undoubtedly be a very different tourism environment”.

The Dunedin City Council has agreed to meet the ongoing costs of mothballing the operation.

DCHL had advised the council that continuing to run Dunedin Railways would cost about $750,000 per quarter ongoing through winter, with little hope of any significant revenue for at least another 18 months.

More costs for ratepayers.  Just a week ago the council were looking like continuing with their annual plan despite a drastic change to the economic situation.

Mr Winders said DRL’s existing business challenges, even when operating in a buoyant tourism market, were well known.

“The impacts of Covid-19 exacerbate these challenges severely because the company is largely reliant on international tourism which makes up 80% of DRL’s total passenger numbers.

“We are unlikely to see international visitors return in the 2020/21 summer and the outlook beyond that is uncertain at this time. With this outlook, it is simply not possible to keep the business operating as normal.” DRL’s main shareholder is Dunedin City Holdings Limited (DCHL).

Chairman Keith Cooper said they were supportive of the decision to mothball the operation.

“This option provides flexibility to explore new and sustainable tourism offerings based on DRL’s assets as the economy and tourism recover post Covid-19.”

Get the Greens to get funds to electrify the Taieri Gorge track? No chance of that for a tourism operation.

With the sudden halt to cruise ships in the middle of March, which was happening regardless of lockdown levels as cruise ships were banned from coming here, as well as air travel being largely stopped, putting the operation on hold was inevitable.

The future for the Taieri Gorge and the other operations of Dunedin Railways – they ran trips on the main line as well – looks grim.