News
Air NZ CEO welcomes strong domestic rebound
October 2nd 2020
Air New Zealand (Air NZ) CEO, Greg Foran, said this week the airline's domestic network had rebounded strongly from the recent lockdown in Auckland as business people returned to the air and other travellers snapped up cheap tickets. Read More »
An Auckland outbreak of COVID-19 in mid-August prompted the New Zealand government to place the city in a partial lockdown and reinstate social distancing measures across the country.
Travel into and out of New Zealand's Auckland, New Zealand’s largest city, was restricted and Air NZ reduced its Auckland schedule in response to that.
When restrictions were eased and social distancing requirements relaxed, the airline put 180,000 of its cheapest fares on sale across 20 of its domestic ports and removed change fees for all flights booked for travel up to March 2021.
Foran said he was thrilled with the response.
"We sold more than a quarter of a million tickets in a 72-hour period - the strongest volume of domestic sales we have ever seen over a three-day period," Foran told shareholders at Air NZ's annual general meeting, held virtually, this week.
"This is fantastic news and shows that more Kiwis than ever are eager to get out and explore our country or visit friends.
"While the outlook for future passenger demand is clearly uncertain, we have seen some highly encouraging signs in our domestic bookings.”
"Business traffic also is rebounding, particularly with our SME travellers, who appear eager to get back out there, in person, to do business again," Foran said.
Despite the performance of the domestic network, Air NZ chair, Dame Therese Walsh, said demand was highly dependent on the removal of travel restrictions in New Zealand and around the world.
In August, the company reported a net loss of NZ$454 million (US$301 million) for the 12 months to June 30 2020, down from net profit of NZ$276 million in the prior year.
Dame Therese declined to provide specific earnings guidance for the current year, citing the uncertainty in the market as to when travel restrictions would be lifted and what the level of demand might be in response.
"However, each of the scenarios we are currently modelling suggest we will make a loss in 2021," Dame Therese told shareholders.
The Air NZ chair said the company had drawn down NZ$110 million (US$73 million) of a NZ$900 million government loan facility, while total available liquidity stood at about NZ$1 billion at 25 September, made up of NZ$215 million cash on hand and the remaining NZ$790 million from the government loan facility.
