The grounding of the Interislander ferry Aratere shortly after its departure from Picton in June 2024 was ultimately caused by how a critical steering system upgrade was introduced and managed, investigators have found.
An interim report published in October 2024 documented the sequence of events, but the Transport Accident Investigation Commission's (TAIC) final report, published today, concluded that gaps in project management, crew training and safety auditing combined to put the 183m vessel and the 48 people on board at risk.
Shortly after leaving Picton on June 21, 2024, the Aratere's pilot engaged the autopilot and then pressed the "execute" button, expecting a minor 3-degree course correction. However, the ship had already passed that waypoint and the autopilot locked onto the next programmed turn — a much larger 34-degree swing to starboard.
The crew reacted quickly, but they could not immediately regain steering control because they had not received training on the operational differences in the ship’s new steering system.
The ferry grounded in Titoki Bay at 13 knots. There were no injuries, but the vessel sustained significant structural damage. It was refloated at 9pm the following night.
Aratere was travelling at three knots when it ran aground shortly after leaving Picton on Friday night. (Source: 1News)
The crew had not been trained on two critical differences between the old steering system and the newly installed Kongsberg replacement, the report found.
The new system required rudder commands to be aligned within 2 degrees before control could transfer between bridge consoles. The old system had no such requirement. When the crew attempted to seize manual control during the emergency, the transfer failed repeatedly because the commands were not aligned.
A force-takeover function, which allowed control to be transferred regardless of alignment if a button was held for five seconds, also existed. Neither the bridge team nor shoreside management knew it was there.
TAIC chief investigator of accidents Louise Cook said the core issue was how the steering replacement project was managed.
"Interislander had treated the replacement steering system as a like-for-like change, without identifying important operational differences before returning the ship to service," she said.
"They focused on installing the equipment, but not enough on understanding how the changes affected operation of the vessel and what crews needed to know to use it safely."
The report also found the ship's internal audit programme had not been properly enforced, leaving management unaware that bridge procedures were drifting from the required standard.
TAIC found it was about as likely as not that the crew's shared familiarity with the route meant no one challenged the absence of a proper pre-departure briefing — one that could have caught the error earlier.
The report also found no single project manager held overall accountability from the project's beginning through to the ship's return from service.
Crew training on the new system consisted of an informal five-minute handover from a technician to a master during sea trials.
A ship-specific manual recommended during installation was never produced before the vessel resumed service. Required three-monthly emergency steering drills had not been conducted on the new system in the weeks before the grounding.
It was the second major TAIC finding against the Aratere citing project management failures in just over a decade. A 2013 inquiry found similar oversight gaps after the vessel's starboard propeller fell off during a Cook Strait crossing.
KiwiRail was fined $375,000 earlier this month by Maritime NZ following the grounding for breaches under the Health and Safety at Work Act 2015.
Changes made, no recommendations issued
Following the grounding, Interislander revised its bridge resource management training, updated navigation assessments, improved its change management processes, and developed ship-specific steering guidance.
Independent assessors now conduct on-board bridge resource management checks across the fleet. The Aratere was retired from service in August 2025.
TAIC said those steps addressed the safety issues identified, and it has not made any formal recommendations.
Cook said the incident highlighted a broader lesson for operators introducing new technology.
"Any organisation introducing new safety-critical equipment needs to ask not just whether the system works, but how it changes the way people operate," she said.
"The human and operational side of change management is critical to safety."
'Should not have happened' – KiwiRail
KiwiRail chief operations officer Duncan Roy said the transport operator accepted the findings in the TAIC report and that the incident should never have happened.
"Although no physical injury or environmental damage resulted, KiwiRail recognises how serious the risk was."
Independent reviews were commissioned immediately after the incident, with a "substantial remedial programme" enacted across the fleet to ensure there was no repeat.
Roy said the Commission had acknowledged and detailed the changes in its report, noting that no recommendations were made as a result of KiwiRail's actions in addressing safety issues.
"Safety is our top priority. We do not sail unless it is safe to do so, and we will continue to provide a safe and reliable Cook Strait service with the current fleet until the arrival of two new, larger, rail-enabled ferries in 2029."
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