Interislander is retiring its only rail-enabled ferry, the Aratere. Photo: RNZ / Samuel Rillstone
The Rail and Maritime Union says the decision to retire the Aratere will sever the rail connection between the North and South Islands for years and make it a less viable freight option.
Interislander's only rail enabled ferry will be taken out of service this year to make way for the construction of new port infrastructure, which is set to see some jobs cut.
Rail Minister Winston Peters said it would cost $120 million to move infrastructure and keep the Aratere in service.
The ship, which first entered service on Cook Strait in 1999, made headlines last year when it ran aground near Picton because of an autopilot mistake.
Rail and Maritime Union general secretary Todd Valster told RNZ that his members would not be directly affected as they did land-based work, such as jobs in the Interislander terminals.
But, Valster said it would affect rail for at least four years.
"Disruption to freight for customers, extended times, more risk, but also what a lot of people don't really realise is that a lot of stuff moves between the islands that is essential to keep the rail infrastructure going on both sides."
He said it would make rail a less viable option for freight.
"The customer may just think we'll just leave it on a truck, it might be the easier option and sometimes it's the cheaper option, but it's certainly not supporting the heavy investment New Zealand has done over recent times."
Road freight lobby group Transporting New Zealand chief executive Dom Kalasih said the retirement would cause more risk to Interislander services.
Kalasih said that would particularly be the case if one of its two remaining ferries had to be taken out of service.
He said it would be "fascinating" to see how freight went without any rail enabled ferries in service.
Tangi Utikere Photo: RNZ / Samuel Rillstone
Labour's rail spokesperson Tangi Utikere said New Zealanders would now have to rely on two ageing boats, which required increased levels of maintenance.
He said there would "clearly" be interruptions to services.
"It is a given that we will see at some time only one of those boats operating, and possibly actually if both of the two existing ships are out of action for whatever reason, it may be that there are no Interislander ferries actually crossing the Cook Strait," he said.
Utikere said Labour's iReX plan would have meant replacement boats arrived much earlier than the current government's approach, and the cancellation of the original deal meant there would be job losses while New Zealanders continued to wait for new ferries to arrive.
"There is no contract in place. We don't know what the final costs will be. The cancellation costs are continuing to rise each day that we continue to wait for those decisions to be taken. There is little certainty, and little confidence I guess, that they will arrive in 2029."
Rail Minister Winston Peters said the government would do required work in Wellington and build a new, double lane linkspan in Picton to serve rail and road for the next 60 years.
"Under iReX, a whole temporary operation was to be built at taxpayers' expense only to knock it down when permanent infrastructure was built, plus 'Taj Mahal' terminal buildings and expensive works across the wider yards in Wellington and Picton.
"That is not good use of funds, and we are getting the taxpayer a superior deal."
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