Air New Zealand grounds 58 aircraft

Wednesday, 1 April 2020

Air New Zealand has grounded just over half its fleet around the country amid the coronavirus lockdown.

The airline has parked 58 of its 114 aircraft across Auckland, Nelson, Christchurch and Wellington airports.

The national carrier has dramatically reduced its usual flying in response to Covid-19 coronavirus, only flying essential workers domestically and dropping 95 per cent of its international capacity.

Air New Zealand has parked 58 of its 114 aircraft across the country.

Last week an almost empty Boeing 787-9 Dreamliner flew back from Singapore, carrying just four passengers, reflecting the challenges the airline industry is facing due to coronavirus.

Air New Zealand chief executive Greg Foran it could take years before the airline returns to the size it was before coronavirus.

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The grounded planes are:

Air New Zealand reduced its international network to just 11 routes and its domestic capacity had significantly scaled back.

7 Q300 domestic turbo prop

10 ATR-72 domestic turbo prop

23 Airbus A320 domestic and shorthaul international

12 Boeing 777-200ER and 777-300ER long haul

6 Boeing 787-9 international long haul

Jet aircraft took about 400 hours to park and initially maintain, while turboprop aircraft took about 100 hours to park and initially maintain, the airline said.

Turboprops took another 20 hours of labour each per week to maintain while in storage.

On Monday evening Air New Zealand chief executive Greg Foran said the airline would start the process of materially reducing its workforce this week due to the impact coronavirus was having on the company.

Foran's most recent email said revenue was expected to fall from about $5.8 billion to less than $500 million, down 90 per cent.

'That's right, a drop of more than $5b. This has the potential to be catastrophic for our business unless we take some decisive action,' Foran said.

International tourism made up two-thirds of the airline's revenue and countries were likely to take a 'cautious' approach to international tourism over the next year, he said.

The only way there would be an improvement in revenue in 2020 would be if Kiwis embraced domestic travel after the level 4 alert was lifted, he said.

Air New Zealand has reduced its international network to just 11 routes and its domestic capacity has been significantly scaled back and is currently accessible to essential workers and freight only.

'Clearly, we will be smaller for some time and we will need fewer staff,' Foran said.

In an earlier email to staff sent on March 16 Foran said the airline's workforce of 12,500 would reduce by 'up to' 30 per cent, equating to about 3750 staff.

It could take years before Air New Zealand returned to the size it was before Covid-19, he said.

International Air Transport Association (Iata) has projected that passenger revenues could plummet by US$252b (NZ$422b) or 44 per cent below 2019 as a result of Covid19 travel restrictions and an expected global recession.

Iata director general Alexandre de Juniac said the worst-case scenario it had predicted some weeks ago had worsened quickly.

'The airline industry faces its gravest crisis,' he said.

'Without immediate government relief measures, there will not be an industry left standing.'