The grounding of the 25-year-old Interislander ferry comes just days after Transport Minister Simeon Brown raised serious concerns about KiwiRail's maintenance of its fleet.
It was just the latest problem in a series of issues for KiwiRail.
On Friday night, the Aratere ran aground 3km north of Picton with 47 people - most of whom were crew - on board.
KiwiRail are working on plans to refloat the vessel, and eight passengers and 12 crew disembarked on Saturday morning.
It comes days after Brown criticised the state-owned company for its handling of ferry maintenance.
At the transport and infrastructure committee on Thursday, Brown expressed government concerns about how KiwiRail had been looking after its fleet.
"We also want KiwiRail to make sure they're maintaining their existing boats to the appropriate standards, which has been a significant issue that we've been highly unimpressed with coming into government."
KiwiRail had been improving their maintenance protocols significantly from the "poor" processes it had in the last few years, he said.
This was partially due to KiwiRail having the importance of well-maintained Cook Strait ferries being highlighted to them.
Brown's comments were not the first time KiwiRail's handling of the Interislander service had been called into question.
Late last year, the government canned the Inter-Island Resilient Connection (iReX) project due to its budget blowing out from $1.45 billion in 2021 to $2.6 billion in 2023.
It would have seen the construction of two large ferries and new port infrastructure in Wellington and Picton.
In a release of documents related to the project last month, the Transport Ministry questioned whether KiwiRail was up to the task of running the Cook Strait ferry business.
KiwiRail's costs continued to grow while its competitor Bluebridge operated commercial services without a subsidy, the documents said.
The ministry said a more commercially viable option should be possible if a new approach was taken, "especially by someone other than KiwiRail".
"Given the difficulties KiwiRail have had with Project iReX, and the fact they have a range of core rail issues to address, [it] raises the question of KiwiRail's suitability to run the Interislander business in the medium to long term.
"The Interislander business could be separated into another State-Owned Enterprise or sold via a trade sale."
KiwiRail was also criticised by the Transport Accident Investigation Commission (TAIC) after the Kaitaki ferry lost power with 880 people in January 2023.
The transport watchdog found that the ship's engines failed after one of the ship's safety-critical rubber expansion joints ruptured and prevented the engines restarting.
It said the accident happened because KiwiRail had failed to replace safety-critical parts, which were years past their use-by dates.
After the incident, KiwiRail chief executive Peter Reidy apologised and said the company had taken "a number of steps to ensure it never happens again".
Earlier this year, Maritime NZ filed one charge under the Health and Safety at Work Act following a near year-long investigation into the incident.
RNZ
