Winston Peters puts KiwiRail on notice over who runs Interislander ferries into the future

Wednesday, 15 April 2026

The Government won’t commit to who will run the Interislander service when the new Cook Strait ferries arrive in 2029, with Winston Peters saying KiwiRail needs to prove its worth.

The Interislander is one of New Zealand’s most well-known brands and has been run by the country’s rail company for six decades.

But whether the state-owned enterprise operated the ferries beyond when the new ships enter the strait in 2029 remained in question.

In select committee documents seen by The Post KiwiRail said it was the service’s default operator and wanted to run it for another 60 years, but ultimately “it is a decision for ministers”.

Read more:

• Arrowtown now the country's most expensive postcode

• Commissioner warns proposed Santana gold mine should be declined if major environmental risks can’t be avoided

• $3.2 billion hits Fonterra farmer-shareholder accounts today - but don’t expect a quick sugar rush for stalling economy

The Post put this to Rail Minister Winston Peters who was aware the company wanted the job into the future.

“They want to continue as the operator, so we want to see strong performance for New Zealand to prove their worth.”

Peters said with work under way for the new port infrastructure needed in Wellington and Picton, the Government had not yet decided on the ferries’ operator into the future.

“We will approve commercial port agreements by mid-2026 with Port Marlborough and CentrePort, which is a key input for the long-term commercial model for deciding the ferry operator.

“Decisions can then be taken on the operator in a sensible, no-nonsense way.”

The Interislander ferry service is a core part of the KiwiRail business, so it is not yet clear what operating it separately to the rail company would look like.

Labour Party transport spokesperson Tangi Utikere said the Government needed to be open about the future of the Interislander service.

“The rail minister needs to front up and tell the public clearly whether KiwiRail will remain the Interislander operator, and explain why the prime minister is leaving the door open to privatisation.”

ACT Party transport spokesperson Cameron Luxton said the Government should be “open to more options”.

“Many companies are capable of running a ferry service, and there’s nothing so unique about the Cook Strait that demands the Government act as service provider.”

Luxton said New Zealanders did not care who ran the ships, but instead whether they ran on time, at a competitive price and “without the need of regular bailouts”.

Utikere said Labour expected KiwiRail to run a good service but “ministers have made that difficult by cancelling the previous ferries forcing them to run ageing fleet that require ongoing maintenance and disruptions”.

The latest plans for the Cook Strait ferries were launched after Finance Minister Nicola Willis pulled the plug on the previous iReX mega ferry plan due to cost overruns.

The price tag for the two new Cook Strait ferries is $596 million but that was only the core “ship contracts' price at anticipated exchange rates.

It was reported by The Post last month that figure could rise could reach $716 million once delivery costs, contingency, and exchange rates are included.

In the six months to 31 December 2025 Interislander made just over $68 million in revenue for KiwiRail.

At the time of reporting the future of Interislander’s only competitor Bluebridge was also uncertain, with reports its parent company StraitNZ was up for sale.