Infobox Company
name = KiwiRail
type = State-owned enterprise
parent =
foundation = 1 July 2008 (as New Zealand (Government) Railways 2008 Ltd trading as KiwiRail Holdings Ltd)
location_city = Wellington
location_country = New Zealand
location =
locations =
key_people = Jim Bolger (Chairman)
area_served = New Zealand
industry = Rail transport in New Zealand
products =
services = Rail freight
Long-distance passenger rail
Urban passenger rail
Inter-island ferries
revenue =
operating_income =
net_income =
num_employees =
divisions = Tranz Scenic
Tranz Metro
Hillside Engineering
subsid =
slogan =
homepage = []
dissolved =
footnotes =
intl =

KiwiRail Holdings Ltd succeeded Toll NZ Ltd as the main railway and inter-island ferry company in New Zealand. Together with infrastructure provider ONTRACK, KiwiRail reports to the board of the New Zealand Railways Corporation [cite web
author = NZPA
date = 2008-09-24
title = Single SOE for state-owned rail companies
url =
publisher = Otago Daily Times
accessdate = 2008-10-01
] , chaired by former Prime Minister Jim Bolger. The government bought the company (less its trucking and distribution operations) from Toll Holdings on 1 July 2008. [cite web
author = NZPA
date = 2008-07-01
title = Bolger to head Govt's 'KiwiRail' service
url =
publisher = The New Zealand Herald
accessdate = 2008-07-04


KiwiRail can be traced back to the construction and development of the railway network in New Zealand beginning in the late 1870s. By the late 1930s the New Zealand economy had become heavily regulated by the state, with widespread Government ownership in banking, insurance, health, education, transport, energy, and utilities, with the New Zealand Railways Department controlling all freight and passenger railway operations. In 1982 the Railways Department and inter-island ferry service were formed into a State-owned enterprise called the New Zealand Railways Corporation (NZRC). In 1983, the land transport sector was deregulated, and rail transport went up against road competition directly for the first time since the 1930s. By June 1984, with the New Zealand economy in a weak position after years of poor economic performance, the long-serving Prime Minister Robert Muldoon called a snap election and was defeated by David Lange's Labour Party.

Following the election, the new Labour Government embarked on what was to become one of the most "comprehensive programs of economic reform of any (OECD) country in recent decades", and involved converting many government departments into State Owned Enterprises (SOE). cite journal
last = Evans
first = Lewis
coauthors = Grimes, Arthur; Wilkinson, Bryce; Teece, David
date = 1996
title = Economic reform in New Zealand 1984-95: The pursuit of efficiency
journal = Journal of Economic Literature
volume = 34
issue = 4
pages = 1856-1902
location = Nashville
url =
] As a result of the market reforms, the financial performance of NZRC was a disaster, with revenues halved by the new competition. During the mid-1980s NZRC was extensively rationalised. By 1989 large operating losses and interest generated a debt of $1.2 billion that could not be sustained. Organisational, financial and cost restructuring in 1990 led to the government on 28 October removing core "saleable" rail transport and shipping operations and creating a separate entity called New Zealand Rail Ltd (NZRL). In 1993 the Bolger National government sold NZRL for $400 million to a consortium headed by Wisconson Central. In 1995 the company was renamed Tranz Rail Holdings Limited; a year later it went public, listing on the New Zealand Stock Exchange and NASDAQ.cite paper
title = The Privatisation of New Zealand Rail
publisher = New Zealand Institute for the Study of Competition and Regulation Inc.
date = 1999-07-10
url =,4986/4986_tranzrail_part_1_100899.pdf
format = PDF
accessdate = 2008-07-04

In 2003, Australia's Toll Holdings made a $394 million takeover of Tranz Rail, renaming it Toll NZ in 2004, with its rail division renamed Toll Rail.

Renationalisation of rail network

In 2003 the New Zealand government proposed a $75.8 million bailout of Tranz Rail, in which the government took a 35% in the rail operator and gave it an immediate $44 million cash injection.

In 2003/2004 Toll Holdings bought a controlling share in Tranz Rail. As part of the takeover deal Toll Holdings sold the rail network back to the New Zealand Government for $1, in exchange for exclusive operating rights.

From 1 July 2004 the New Zealand Railways Corporation assumed the Crown's responsibilities under the rail access agreement with Toll (repurchase of the rail network), and adopted the trading name ONTRACK.

Renationalisation of rail and ferry operations; creation of KiwiRail

In December 2007, rumours began circulating that the government intended to buy Toll Rail back. However, Minister of Finance Michael Cullen would not confirm these rumours. [cite news |first= |last= |authorlink= |author=HERALD REPORTERS |coauthors= |title=Trains sale on the cards |url= |format= |work=NZ Herald |publisher=APN Holdings |location=Auckland |id= |pages= |page= |date=2007-12-04 |accessdate=2008-07-14 |language= |quote=The minister refused to comment on what he said was a confidential commercial negotiation, ... |archiveurl= |archivedate= ] The buyback was confirmed with a government announcement in May 2008 that Toll NZ Ltd would be purchased from Toll Holdings for $NZ690 million (including $NZ140 million of debt).

The New Zealand Government bought Toll NZ Ltd (less its trucking and distribution operations) on 1 July 2008 and renamed it KiwiRail. Michael Cullen has said that to keep the rail running $80 million will be needed over the next five years; he has also signalled a "reinvestment package" of about $380 million, including new locomotives, which could be assembled in New Zealand.cite web
author = NZPA
date = 2008-07-13
title = Govt may assemble Kiwirail locomotives in NZ
url =
accessdate = 2008-17-13
ref = AssembleLoco

The government's rationale for buying back the rail network includes:
*To develop a more environmentally-friendly and sustainable transport method (particularly for freight)
*The fact that a privately owned rail system in New Zealand has proven unrealistic, as it proved any private organisation running the rail network would need taxpayer support to make the operation viable
*Tourism potential
*Potential political interests [cite web
author = Claire Trevett
date = 2008-04-05
title = Hundreds of millions to modernise rail
url =
publisher = New Zealand Herald
accessdate = 2008-07-04

ee also

*ONTRACK - New Zealand's rail infrastructure Company
*Toll NZ
*Tranz Rail


External links

* [ KiwiRail website]
* [ Image of the the planned KiwiRail livery on the trains.]

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