Air New Zealand: Difference between revisions
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In early 2002 [[Ralph Norris]], formerly head of [[ASB Bank]], one of New Zealand's main banks, was announced as the new CEO of Air New Zealand, and commenced the difficult task of pulling the airline back from near-death. |
In early 2002 [[Ralph Norris]], formerly head of [[ASB Bank]], one of New Zealand's main banks, was announced as the new CEO of Air New Zealand, and commenced the difficult task of pulling the airline back from near-death. |
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In mid 2002 Air New Zealand announced it would reconfigure its domestic operations as a lower-cost airline, doing away with business class and meals on most domestic flights, the longest of which was |
In mid 2002 Air New Zealand announced it would reconfigure its domestic operations as a lower-cost airline, doing away with business class and meals on most domestic flights, the longest of which was 1 hour 50 minutes. The airline justified this new style of service (known as Express Class) on the basis that few people traveled business class and that travellers would rather save the money on airline ticket costs than pay extra for a meal. Although the company had had online bookings for several years, it made internet sales its primary sales medium, abolished travel agents' commissions and added fees for agent, telephone and counter sales. The approach was an outstanding success, with a huge increase in internet bookings being recorded once the new fare structure was introduced, and domestic bookings eventually increasing by 23% on average. During July 2002, the airline announced an order for 15 [[Airbus]] [[Airbus A320|Airbus A320-200]] aircraft, to replace [[Boeing 737|Boeing 737-300]] and [[Boeing 767|Boeing 767-200]] aircraft then in use on the Tasman. Five of these would be purchased by the airline, whilst the other ten were to be leased. |
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In late 2002 the New Zealand Government agreed in principle to allow [[Qantas]] to purchase a 22.5% shareholding at a cost of NZ$550 million; the purchase being subject to regulatory approval in both Australia and New Zealand. However, this proposal was met with resistance from the regulatory bodies in both countries — despite industry experts such as [[IATA]] head Giovanni Bisignani calling their opposition "misguided" and suggesting that the proposed alliance was a model example of the only possible method of survival for smaller airlines. In late 2003 the Australian and New Zealand regulatory bodies both rejected the alliance as being anti-competitive, despite a worldwide trend for airlines to consolidate (such as the 2003 acquisition of [[KLM]] by [[Air France]]). Air New Zealand and Qantas both announced they would appeal the decisions. |
In late 2002 the New Zealand Government agreed in principle to allow [[Qantas]] to purchase a 22.5% shareholding at a cost of NZ$550 million; the purchase being subject to regulatory approval in both Australia and New Zealand. However, this proposal was met with resistance from the regulatory bodies in both countries — despite industry experts such as [[IATA]] head Giovanni Bisignani calling their opposition "misguided" and suggesting that the proposed alliance was a model example of the only possible method of survival for smaller airlines. In late 2003 the Australian and New Zealand regulatory bodies both rejected the alliance as being anti-competitive, despite a worldwide trend for airlines to consolidate (such as the 2003 acquisition of [[KLM]] by [[Air France]]). Air New Zealand and Qantas both announced they would appeal the decisions. |
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Revision as of 05:24, 29 August 2007
 | This article needs additional citations for verification. (December 2006) |
| File:AirNZ Logo.png | |||||||
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| Founded | 1940 (as Tasman Empire Airways Limited) | ||||||
|---|---|---|---|---|---|---|---|
| Hubs | Auckland International Airport | ||||||
| Focus cities | Wellington International Airport Christchurch International Airport Los Angeles International Airport | ||||||
| Frequent-flyer program | Airpoints | ||||||
| Alliance | Star Alliance | ||||||
| Fleet size | 97 | ||||||
| Destinations | 48 | ||||||
| Parent company | Her Majesty the Queen in Right of New Zealand (80.14%) | ||||||
| Headquarters | Auckland, New Zealand | ||||||
| Key people | Rob Fyfe (CEO), Rob McDonald (CFO) | ||||||
| Website | http://www.airnewzealand.com | ||||||
Air New Zealand Limited ASX: AIZ NZX: AIR is a major scheduled passenger airline based in Auckland, New Zealand, and the nation's flag carrier. The airline focuses on Australasia and the South Pacific, with services to Europe, North America and Asia, and is a Star Alliance member. Its main base is Auckland International Airport[1].
History
Beginnings as TEAL
The airline was established as TEAL (Tasman Empire Airways Limited) on 26 April 1940. Its first flight was on 30 April 1940, with Short Empire flying boat ZK-AMA "Aotearoa" carrying ten passengers from Auckland to Sydney. It took around 7 hours 30 minutes to travel the 1345 miles. TEAL's first annual report, dated 31 March 1941, revealed that 130 trans-Tasman flights had been completed, 174,200 miles flown and 1461 passengers carried, with a profit of £NZ31,479. During WW2 TEAL undertook several special charter and reconnaissance flights to New Caledonia, Fiji, Tonga, Samoa and Hawaii to assist the war effort. In June 1944 TEAL crossed the Tasman Sea for the 1000th time.
After World War II TEAL re-equipped, initially with Short Sandringham and later Short Solent flying boats. A former Royal New Zealand Air Force PBY Catalina was used for survey flights. One of the Solents is preserved in TEAL colours at the Museum of Transport and Technology, Auckland. TEAL's initial schedule of two weekly flights from Auckland to Sydney was soon expanded with departures from Wellington, and flights to Fiji were also added during the early years.
Union Airways and NAC
In 1947 a domestic competitor appeared in the form of the Government-owned National Airways Corporation (NAC). NAC was formed from Union Airways and a number of other smaller operators, and equipped with de Havilland Dragon Rapides, de Havilland Fox Moths, Douglas DC-3s, Lockheed Electras and Lockheed 14s. In the late 1940s NAC also provided international services to nearby South Pacific countries, using converted ex Royal New Zealand Air Force Short Sunderlands. Ex NAC Dragon Rapides, Fox Moths and DC-3s still fly in private hands. Examples of all three and two ex-NAC Lockheed Electras are preserved at the Museum of Transport and Technology, Auckland. One of the converted RNZAF Sunderlands was until recently airworthy in the Kermit Weeks collection. These were lated supplemented by de Havilland Herons, Vickers Viscounts, Fokker Friendships and ultimately Boeing 737s. NAC also acquired a freight subsidiary, Straights Air Freight Express, which operated Bristol Freighters and Armstrong Whitworth Argosys.
Post War expansion of TEAL
In 1953 the Australian Government bought 50% of TEAL, with the New Zealand Government buying the rest. In 1954 TEAL added Douglas DC-6s from the defunct British Commonwealth Pacific Airlines to its fleet, and the landplane replaced the outdated flying boats on most international services. The flying boats operated their last services in 1960. TEAL operated services between Auckland and Fiji to replace BCPA's service. In 1955 TEAL made its 10,000th trans-Tasman crossing. In 1959 TEAL again changed its fleet, replacing the DC6s with Lockheed L-188 Electra IIs. The turboprop aircraft was capable of carrying 71 passengers at nearly 400 miles per hour, and reduced the Auckland to Sydney flying time to 3 hours 50 minutes.
In 1961 the New Zealand Government bought the Australian Government's half share, and on 1 April 1965 the airline was renamed Air New Zealand[1].
The 1960s
Air New Zealand entered the jet age with the arrival of its first Douglas DC-8 on 20 July 1965. The increased range of the jets enabled Air New Zealand to commence services to the United States and Asia for the first time — on 14 December the first Auckland to Los Angeles service took off, via Nadi and Honolulu. Singapore and Hong Kong followed in early 1966.
On 4 July 1966, a Douglas DC-8 training flight crashed during takeoff at Auckland Airport. The probable cause of the crash was inadvertent thrust reverser deployment during a simulated engine failure on takeoff. The crash killed two of the five people on board.
The 1970s; merger; Erebus
In 1970 Air New Zealand placed an order for its first wide-body aircraft, the McDonnell Douglas DC-10. The first arrived in January 1973, and Air New Zealand continued to add to its route network during the 1970s.
On 1 April 1978 the domestic airline National Airways Corporation (NAC), founded in 1947, and its subsidiary Safe Air were absorbed into Air New Zealand[1], which used the NAC NZ prefix for domestic flight numbers and the Air New Zealand TE prefix for international flights until the late 1980s, when NZ became universal.
The crash of American Airlines Flight 191 led to a temporary grounding of DC-10s, stranding hundreds of passengers on both sides of Air New Zealand's Los Angeles–Auckland route. The airline chartered a Pan Am Boeing 747 to transport stranded passengers.[2]
On 28 November 1979, an Air New Zealand DC-10 sightseeing flight crashed into Mount Erebus, Antarctica. The Mount Erebus disaster killed all 237 passengers and 20 crew members on board. The incident indirectly played a part in a 1980 decision by the airline to replace its DC-10s with Boeing 747s.
The 1980s
In 1981, Air New Zealand's first Boeing Boeing 747-200 was delivered, starting the replacement of the DC-10s. The airline retained Boeing's customer code of -19 assigned to NAC, so all Boeing aircraft built for the airline carry the -19 designation at the end of their model number - the 747-200s were 747-219s. In 1982 the first Air New Zealand flight to London (via Papeete and Los Angeles) took place. Air New Zealand was now a global airline. In 1985, the company's first Boeing 767-200 was delivered.
1989 onwards - privatisation
New ownership and stock exchange listing
In October 1989 Air New Zealand was privatised with its sale to a consortium headed by Brierley Investments Ltd. Brierleys retained 65%, with 30% to be sold to the New Zealand public, staff, and institutional investors — Qantas with 19.9%, Japan Airlines 7.5%, American Airlines 7.5%, and a New Zealand Government "Kiwi share" made up the balance. The Kiwi share has special powers to ensure that the majority shareholding is held by New Zealanders. In the same year Air New Zealand listed on the New Zealand Stock Exchange.
Further expansion
In 1989 its first Boeing 747-400 was delivered, and in 1991 it received its first Boeing 767-300, supplementing the seven 767-200s then in service. The early 1990s saw new routes added:
- 1990: Kuala Lumpur, Denpasar, Bangkok
- 1991: Nagoya, Taipei
- 1993: Seoul
- 1994: Sydney – Los Angeles, Osaka
- 1995: Fukuoka
Australia
After the success of the deregulation of the Australian domestic air market in 1990, the Keating government announced that it would allow New Zealand carriers unlimited access to the Australian market. Air New Zealand immediately planned to operate frequent services between the major Australian cities. However, at the last minute the Australian Transport Minister backed out of the deal, and although Air New Zealand was allocated an increased number of international departure slots from Australian cities, it was not permitted to operate domestically within Australia. This had far-reaching implications, as Air New Zealand was forced to look at other ways of increasing its market in Australia, which resulted in the acquisition of Ansett Australia.
Expansion
In 1995 Air New Zealand added Fukuoka to its Japanese destinations, and announced its long-standing plan to buy 50% of Ansett Airlines, a significantly larger company than Air New Zealand itself. Owned 50% by TNT and 50% by News Limited, Ansett held close to half of the large Australian domestic market but had been declining for some years. Market analysts reported that Ansett had under-performing major assets and an ageing fleet, and needed a capital injection of at least A$300 million to shore up its weak balance sheet.
For Air New Zealand, purchasing TNT's half of Ansett represented a way to buy into the rich Australian domestic market. The deal had been under discussion with both of Ansett's owners since October 1994, and required some complex manoeuvring to meet regulatory requirements on both sides of the Tasman, including the sale of Ansett New Zealand, Air New Zealand's only significant home market competitor (to News Limited) to satisfy New Zealand Commerce Commission requirements, and the sale of 51% of Ansett International (to a consortium of Australian institutional investors) to satisfy Australian Foreign Investment Review Board requirements that, if not met, would have meant the loss of Ansett International's bilateral air service agreement rights. The terms of the agreement saw Air New Zealand pay A$475 million for half of Ansett, including a $A150 million capital injection, and the transaction was completed on 1 October 1996.
A low-cost subsidiary, Freedom Air, began operations in 1996. In 1997 South Korean flights were suspended because of the Asian financial crisis, and a small partnership was formed with United Airlines. In 1998 EVA Air and Air New Zealand jointly started operating Boeing 767 services between Taipei and Auckland. In addition, Air New Zealand received three new Boeing Boeing 737-300s to operate on flights between New Zealand and Australia.
During 1998 the company started selling all five of its 747-200 aircraft to Virgin Atlantic, with these being disposed of during 1999 and 2000. Sir Selwyn Cushing became the company's chairman after Bob Matthew stepped down, and also in 1998 Air New Zealand announced alliances with various airlines and the intent to become a member of the Star Alliance in 1999.
1999 saw all five weekly services to Tokyo operated by 747-400s and an additional 747 arrived in Auckland. At the end of the year, Air New Zealand and United filed for anti-trust immunity with the United States Department of Transportation because of the two companies' alliance agreements.
Over-expansion
In March 1999 Ansett and Air New Zealand became full Star Alliance members. 1999 also saw the start of a long and confusing battle over ownership of Ansett. Ansett remained profitable but was having increasing difficulty in finding a way to rationalise its cost structure, and badly needed a capital injection to replace its elderly fleet. Of the two half owners, News Limited was more interested in selling out and investing the proceeds in other industries, while Air New Zealand did not have the funds to spare: with 102 aircraft, nearly 15,000 staff and a turnover of $US2.3 billion (compared with Air New Zealand's 72 aircraft, 9,200 staff and $US1.8 billion turnover) Ansett's need for capital was greater than Air New Zealand's ability to provide it—particularly given the age of Air New Zealand's own fleet.
Singapore Airlines (SIA) and Qantas expressed an interest in buying Air New Zealand, Ansett employees planned a staff buy-out, and both SIA and Air New Zealand looked at buying News Limited's 50% share of Ansett. In March 1999 SIA made a formal offer of $A500 million for a half share. Given SIA's industry-leading status, ability to fund Ansett's re-equipment and expansion and global marketing network, industry observers were enthusiastic about the move. However as part of its original deal to buy TNT's half of Ansett, Air New Zealand had a pre-emptive right to News Limited's half, provided only that it matched or bettered other offers.
The Air New Zealand board eventually approved the sale to SIA, but negotiations stalled when major Air New Zealand shareholder Brierley Investments began buying more Air New Zealand shares and attempting to get SIA to buy Ansett through either Air New Zealand or Brierley, rather than from News Limited. In June, News Limited withdrew the offer to sell, citing "not yet resolved issues" between SIA and Air New Zealand.
At this stage, Ansett announced an unexpectedly high profit for the year—$A149 million—and News Limited took advantage of that to raise the asking price to $A1 billion. Industry analysts regarded this as far too optimistic in the notoriously boom and bust airline business, and put the true value of a half share at no more than $A700 million.
In February 2000 Air New Zealand announced its decision: it would buy the remaining half of Ansett for $A680 million. Industry observers were united in the belief that it was a bad decision: the price was probably too high, and Air New Zealand would not be able to fund the badly needed re-equipment.
Former Qantas chief financial officer Gary Toomey was appointed Chief Executive Officer of both Air New Zealand and Ansett Holdings in December 2000. Services to Frankfurt and Honolulu from Los Angeles were dropped, and were taken on by Star Alliance partners Lufthansa and United.
In 2001 Air New Zealand announced plans to buy 16 new Raytheon Beechcraft 1900D aircraft to replace its Bandeirantes and Metroliners, which had served faithfully for 20 years, servicing airports without jet capability.
Collapse
Ansett was in poor shape[citation needed]. Lack of proper maintenance to its 767 fleet—some of which were almost 20 years old—had seen the Australian Civil Aviation Safety Authority (CASA) ground seven aircraft two days before Christmas 2000 while inspections were carried out[citation needed]. In April 2001, one day before the busy Easter holiday period, all 10 Ansett 767s were grounded again when a series of other safety problems came to light, and Ansett was threatened with withdrawal of its Air Operator's Certificate[citation needed].
To cover the loss of one third of Ansett's capacity, Air New Zealand chartered Ansett a 767 and a 747 from its own fleet, and additional aircraft were chartered from SIA, Air Canada, and Emirates. SIA—25% owner of Air New Zealand and thus indirectly of Ansett—agreed to provide technical assistance to get the 767s back into the air[citation needed].
Despite the great loss of public confidence in the airline, the news was not all bad. Chief executive Gary Toomey announced that the total cost of the groundings was only $NZ5.2 million, and that the seven oldest Ansett 767s would be sold, along with three of Air New Zealand's 767s, and newer aircraft leased in their place. Toomey said:
- What it really highlights though is that nothing has really changed in our strategy and that is that we need to re-equip, we need to grow our capacity, we need to have new products, so I think it just brings these objectives into focus more and more by having a high profile about what's happened.[citation needed]
The reality was rather different. In revenue terms, Air New Zealand was the 39th largest airline in the world, Ansett 32nd. However, both airlines were only marginally profitable and needed a substantial capital injection that neither was able to provide[citation needed]. The larger very successful airlines Qantas and SIA both made offers to buy the Air New Zealand group but needed regulatory approval to lift the 25% foreign ownership rule. The Clark government refused to make a decision. Deputy Prime Minister Jim Anderton said "the idea of selling our national airline to anyone would be an anathema", even though Air New Zealand was at that time already 49.9% foreign-owned: 25% by Singapore Airlines, and 24.9% by Brierley Investments, which was originally a New Zealand-based concern but had relocated to Singapore in 2000, and circumvented the foreign ownership restrictions by using a New Zealand-based trust to hold its Air New Zealand shares.
The inconsistencies of national pride were not confined to the eastern side of the Tasman: public opinion polls showed that while New Zealanders were strongly opposed to Qantas buying into Air New Zealand, and moderately opposed to SIA increasing its stake, Australians were in favour of a Qantas buy-out of Air New Zealand but objected to any further SIA ownership of Air New Zealand (and thus Ansett) on the grounds that it would mean foreign ownership of Ansett—forgetting that Ansett was already 100% foreign-owned[citation needed].
Meanwhile, Air New Zealand's financial position was deteriorating, and Ansett was losing market share to both Qantas and a new entrant on the Australian domestic market[citation needed], Virgin Blue. The Air New Zealand board decided that the answer was to spend still more money, and buy Virgin Blue as well as Ansett. On condition that that deal went through, SIA was prepared to fund the purchase of 32 new aircraft for the Air New Zealand group. Virgin Blue, however, was growing fast, largely at the expense of Ansett; the initial $A120 million offer was deemed insufficient and in August Virgin Blue owner Sir Richard Branson, with his customary gift for publicity, put an end to negotiations when he tore up on television what he claimed was a $A250 million Air New Zealand cheque.[3]
On 10 September 2001, in desperation Air New Zealand offered to sell Ansett to Qantas for $1[citation needed]. After two days' consideration Qantas declined, and Air New Zealand suspended trading in its shares (which had already dropped enormously) and placed Ansett in voluntary administration. Ansett was bankrupt, and Air New Zealand was in barely better shape. The following day Air New Zealand announced a staggering $NZ1,425 million loss: a $NZ1,321 million write-off of Ansett, and another $NZ104 million lost by Air New Zealand itself.
Ansett's trading loss for the year had been $NZ165 million (plus another $NZ23 million for Ansett International), or about $NZ8 million a month for most of the year, but with a sudden blow-out to around $NZ40 million a month for the last two months[citation needed].
A storm of public criticism on both sides of the Tasman erupted, and bitter accusations were levelled. In particular, it was asked how such massive losses were possible when Ansett had a healthy 74% average load factor.
In an angry statement, Air New Zealand denied that there had been a programme of last-minute asset-stripping, that it had put $A200 million of Air New Zealand fuel bills through Ansett, cleaned out Ansett's bank accounts, or taken Ansett engines and spare parts to New Zealand[citation needed]. Ansett's administrators subsequently verified there had been no last-minute asset-stripping, but many refused to let facts get in the way, as Air New Zealand workers in Australia were abused and spat on.
The trans-Tasman anger was enormous. At one stage, New Zealand Prime Minister Helen Clark, on her way back to New Zealand from the Middle East, found her aircraft blockaded on the Melbourne airport tarmac by laid-off Ansett workers, who refused to allow the jet to take off. Eventually, an RNZAF Orion maritime reconnaissance aircraft had to be sent to fetch her[4].
The Australian Securities and Investment Commission (ASIC) began an investigation of whether Ansett had gone on trading while insolvent, and eventually determined in July 2002 that it would be too expensive and difficult to proceed with an action which would, in any case, need to be many separate actions on behalf of individual creditors rather than just one.
It later became clear from the release of documents under the New Zealand Official Information Act that the New Zealand Government had pressured the Australian Government not to support legal action against Air New Zealand, saying that this would "prejudice rather than progress the interests of those with financial claims against the company". The Australian government stated that the pressure had no effect on its decisions.
New Zealand media criticised Australian media for "Kiwi bashing", contrasting poor coverage of instances of Australian protectionism and criticising pressure for New Zealand taxpayers to prop up the uncompetitive Australian business.
Laid-off Ansett workers were eventually paid most of their entitlements, partly from an $A150 million compensation package offered by Air New Zealand in return for having the ASIC enquiry dropped, but mostly by an $A10-per-seat levy imposed by John Howard's government on Australian airline passengers.
Rebirth
In October 2001 the New Zealand Government announced that it would provide Air New Zealand with an $NZ885 million rescue package, and in return would take up 80% ownership. Gary Toomey resigned as CEO the same month.
In early 2002 Ralph Norris, formerly head of ASB Bank, one of New Zealand's main banks, was announced as the new CEO of Air New Zealand, and commenced the difficult task of pulling the airline back from near-death.
In mid 2002 Air New Zealand announced it would reconfigure its domestic operations as a lower-cost airline, doing away with business class and meals on most domestic flights, the longest of which was 1 hour 50 minutes. The airline justified this new style of service (known as Express Class) on the basis that few people traveled business class and that travellers would rather save the money on airline ticket costs than pay extra for a meal. Although the company had had online bookings for several years, it made internet sales its primary sales medium, abolished travel agents' commissions and added fees for agent, telephone and counter sales. The approach was an outstanding success, with a huge increase in internet bookings being recorded once the new fare structure was introduced, and domestic bookings eventually increasing by 23% on average. During July 2002, the airline announced an order for 15 Airbus Airbus A320-200 aircraft, to replace Boeing 737-300 and Boeing 767-200 aircraft then in use on the Tasman. Five of these would be purchased by the airline, whilst the other ten were to be leased.
In late 2002 the New Zealand Government agreed in principle to allow Qantas to purchase a 22.5% shareholding at a cost of NZ$550 million; the purchase being subject to regulatory approval in both Australia and New Zealand. However, this proposal was met with resistance from the regulatory bodies in both countries — despite industry experts such as IATA head Giovanni Bisignani calling their opposition "misguided" and suggesting that the proposed alliance was a model example of the only possible method of survival for smaller airlines. In late 2003 the Australian and New Zealand regulatory bodies both rejected the alliance as being anti-competitive, despite a worldwide trend for airlines to consolidate (such as the 2003 acquisition of KLM by Air France). Air New Zealand and Qantas both announced they would appeal the decisions.
In November 2003 Air New Zealand extended the successful low-cost domestic Express concept to trans-Tasman routes. Early indications are that this move has also proved successful, with an estimated 10% increase of bookings in the first few months of operation. On 30 June 2004 the airline commenced non-stop services from Auckland to San Francisco, the first new international destination for eight years. In September 2004 Air New Zealand was named Best Long Haul Airline in the seventh annual Conde Nast Traveller UK Readers' Awards.
On 20 September 2004 the New Zealand High Court blocked Qantas' plan to buy 22% of Air New Zealand. Qantas and Air New Zealand decided not to lodge an appeal. However, both Ralph Norris and his counterpart at Qantas, Geoff Dixon, have stated that the airlines will continue to assess other forms of cooperation that will not conflict with competition regulations. In October 2004 SIA sold its remaining stake in Air New Zealand.
Onwards into the future
On 2 June 2004 Air New Zealand announced its fleet renewal plan, to acquire eight new Boeing 777-200ER and two Boeing 787-8 aircraft at a cost of NZ$1.35 billion, as well as rights to purchase a further 42 long-haul aircraft. Deliveries would begin in 2005 (777) and 2010 (787), and the aircraft would be used to develop new routes and increase frequency on existing routes, as well as providing an overall increase in both passenger and cargo capacity. On 27 October 2005 it announced that it was ordering another two Boeing 787-8 aircraft. On 11 May 2006 the airline converted its four 787-8 orders to 787-9s - it will be the first airline to take delivery of the 787-9 variation, in December 2010.
Four of the Boeing 767-300 aircraft that operated the services which the new Boeing 777-200ER aircraft now operate will be returned to their owners when their leases expire, while the five that Air New Zealand own will remain in the fleet for short to medium distance operations until delivery of four Boeing 787-9 aircraft has been completed. From the end of 2006 the Air New Zealand longhaul aircraft fleet will consist of eight Boeing 777-200ER and eight Boeing 747-400 aircraft, all with the new longhaul product.
On June 14 2005 Air New Zealand Chief Executive Ralph Norris announced that he had accepted the position of Managing Director and Chief Executive of the Commonwealth Bank of Australia and therefore would be leaving Air New Zealand on August 31.
On 30 May 2005 the United Kingdom and New Zealand reached an agreement that removed Air New Zealand's effective restriction of seven return services per week, along with several other restrictions.[2] Limits may still be imposed on the number of passengers carried by airlines from New Zealand on routes between London and the USA because, under the bilateral agreement the UK has with the US, restrictions apply on the number of passengers that may be carried by UK airlines between the USA and the UK. As a result of this agreement, on April 5 2006 Air New Zealand announced a new service between Auckland and London Heathrow via Hong Kong, which commenced on October 28 2006.
On September 7 2005 the Boeing Company advised Air New Zealand that due to a strike by assembly workers the delivery of the new Boeing 777 aircraft would be delayed, possibly by months. Air New Zealand is in line for millions of dollars in compensation for the delays. Air New Zealand finally took delivery of its first Boeing 777 aircraft on 28 October.
On October 5 2005 Air New Zealand announced plans to fly to Adelaide from Auckland, starting March 2006. The carrier will use new Airbus A320 aircraft on the route. As of December 2006 Air New Zealand have replaced their Airbus A320 with a Boeing 777-200 to cope with the popular demand. With Polynesian Airlines canceling their services to Niue on October 7 2005, Air New Zealand announced that it would be commencing weekly services using an all-economy 737-300.
On October 14 2005 Air New Zealand announced that Rob Fyfe, the General Manager of the Airlines Division, would succeed Ralph Norris as CEO. The airline announced that it would be applying for consent to commence direct thrice-weekly return services between Auckland and Shanghai. On October 16 2005 Air New Zealand unveiled its new uniform.
On October 26 2005 Air New Zealand announced that it was doubling its order for Boeing 787-8 aircraft, from two to four.
On January 17 2006 Air New Zealand announced that it was considering the purchase of additional 777 aircraft, with a possible ten 777-300ERs to replace the 747-400s. Air New Zealand has also considered purchasing the Boeing 747-8, Airbus A380 for high density routes. Air New Zealand has also shown interest in opening a new route to New York JFK, using their B777 rights to purchase up to four Boeing B777-200LR.
On December 20 2006 Air New Zealand confirmed the purchase of an additional four Boeing 787-9 aircraft to meet its growth plans over the next decade.
On August 3 2007 Air New Zealand announced that it was exercising its options for 4 777's and was purchasing 4 Boeing 777-300ERs. The new aircraft would compliment the new 777-200ERs and would be delivered in 2011, a year after the first delivery of Air New Zealand's first Boeing 787-9. The -300ERs would replace Air New Zealand's aging 747 fleet. By 2012, Air New Zealand's mid-size twin engine fleet will be the Boeing 777-200ER, Boeing 777-300ER and the Boeing 787-9.
General Manager Strategic Development Nathan Agnew says that with this order Air New Zealand has now confirmed the purchase of a total of eight 787-9 aircraft and has secured options over eight further production slots giving the airline access to 16 of these new generation aircraft over the coming decade.
Outsourcing of maintenance
On October 19 2005 Air New Zealand proposed outsourcing most of its heavy maintenance on its long-haul aircraft and engines, which would result in about 600 job losses, mostly in Auckland. Air New Zealand said that "Maintenance, repair and overhaul for long-haul aircraft is now dominated by large scale international maintenance providers, who through their size can achieve more competitive cost structures. Add to this their proximity to key customers and, for some, the benefits of operating in low-cost Asian economies, and our current small scale, remote operation simply cannot compete." The proposal is estimated to save $100 million over five years and comes after many attempts to attract contracts to service other airlines longhaul aircraft. The Royal New Zealand Air Force has stated that it is interested in employing some of these. The first 110 staff received their redundancy notices in December 2005.
A union proposal to save some of the remaining jobs was rejected in a worker vote in February 2006 (Radio New Zealand), but a second vote saw the plan accepted. Shift and pay changes, most of them pay-cuts, will allow about 300 engineers in Auckland to keep their jobs, although about 200 will still be made redundant. (NZ Herald)
New brand identity
 | This article contains content that is written like an advertisement. |
At 12.01 am on March 27, 2006 Air New Zealand embarked on a worldwide synchronised changeover to a new brand identity, involving a new Zambesi-designed uniform, new logo, new colour scheme and new look check-in counters and lounges. More than 5000 staff in airports and offices around the world embarked on a 24-hour synchronised changeover from the old to the new uniforms, and 180 crew on board 13 flights operating at the scheduled time embarked on a mid-flight changeover.
At the same time, the airline worked through the night to install new greenstone-coloured walls featuring a fern-like extension of the koru behind check-in counters at Auckland, Wellington and Christchurch airports, and removed reception desks at the entrance to Koru lounges in Auckland, Wellington, Christchurch, Sydney and Los Angeles, to enable staff to welcome and greet customers in a more friendly and relaxed manner.
The key features of Air New Zealand's new brand identity include:
New uniforms: the most globally visible part of the brand change, more than 5000 staff from airports and offices around the world stepped into new uniforms, six months after they were revealed at Air New Zealand Fashion Week 2005. Designed in consultation with uniformed staff representatives, the new uniform features a distinctly New Zealand colour palette mirroring the greenstone, teal, schist and slate hues of New Zealand, sea and sky; a Māori motif created by the talented Derek Lardelli; soft fabric woven from the finest New Zealand merino wool, and hallmark curves inspired by the koru.
New Zealand Greenstone: a deep rich greenstone colour replaces the incumbent blue Pacific Wave colour. Following the unveiling at Auckland, Wellington and Christchurch airports on March 27, 2006, the new colour will be progressively introduced in all Air New Zealand environments over the next two years. Inspired by the colour of the pounamu, the prized gemstone found in New Zealand, this deep rich colour reflects New Zealand's lush fauna, landscapes and forests.
Renewal and rebirth: the Air New Zealand Koru, itself a symbol of renewal and rebirth, is iconically linked to Air New Zealand's heritage. Signifying the airline's new direction and growth, the koru has been extended and will eventually be woven throughout all Air New Zealand's signage, products and collateral.
Trans-Tasman AOC changes
 |
To help combat increasing labour costs Air New Zealand has merged its fleet of A320 aircraft, which operate trans-Tasman services, under the Air Operator's Certificate of Zeal320, a wholly owned subsidiary. On 31 July 2006 flights were re-numbered to the NZ700-999 series. Passengers will continue to travel on an Air New Zealand branded aircraft and receive Air New Zealand's service.
Tasman Networks agreement
On April 12, 2006 Air New Zealand and Qantas announced that they had signed a codeshare agreement for their trans-Tasman routes and would file for authorisation from the New Zealand Ministry of Transport [3] and the Australian Competition and Consumer Commission[4]. The airlines maintained that they were making losses on Tasman routes due to too many empty seats, and that a codeshare would return the routes to profitability. Critics, particularly Wellington International Airport and Melbourne Airport, argued that the codeshare would lead to reduced passenger choice and higher airfares, and that the airlines were exploiting an effective duopoly on the Tasman routes. On November 15, 2006 the airline announced it was withdrawing its application after a draft decision by the Australian Competition and Consumer Commission to not approve the code-sharing agreement.
Services
New long-haul product
On 28 June 2004, Air New Zealand released some of the details regarding their new long-haul product, which will help the airline turn around the profitability of its international services. Every seat on their Boeing 747 (and ordered Boeing 777) fleet of aircraft will be replaced with a more comfortable seat equipped with a personal LCD screen linked to an audio and video on demand system which allows passengers to play, pause, stop, rewind and forward media on demand, just as they can with DVDs and CDs at home. First class will be removed, the business class cabin will be upgraded to feature seats that convert into flat beds 6' 7.5" in length, and a new premium economy section is being installed.
A new generation seat design which provides more space is being installed into Pacific Class (Economy), the main cabin. The seats have a flexible edge seat base to provide more leg support when reclined and the entertainment equipment is mounted far up below the seat to maximise space available to the passenger. In a first for Air New Zealand, every seat in the main cabin will have an 8.4" personal LCD screen linked to the system.
Pacific Premium Class (Premium Economy), is a new concept to Air New Zealand, which will be the only airline offering the product into New Zealand. Premium Economy seats are in a dedicated cabin, which shares lavatories with the Business Class cabin. The class has the same mood lighting, wine selection and inseat power for electronic devices such as laptops as the Business Class cabin. The seats are wider than Pacific Class, with more legroom. A re-launch of this product had been announced by Air New Zealand. Because of the high demand and good reviews from customers of this product from its inaugural launch a year ago, Air New Zealand have decided to incorporate more Business Premier services into the cabin. These improvements include amenity kits from Living Nature, improved dining experiences.
The new Business Premier Class (Business class), cabin will introduce a seat that converts to a flat bed, the only truly lie-flat bed in Business Class flying to or from New Zealand. The seats are configured in a herring-bone layout, meaning that every seat has direct aisle access. The seat is a variation on the Virgin Atlantic Airways Upper Class seat, which was paid for the licence to these seats. Air Canada has ordered similar seating for an upgrade of its Business Class. Another airline that is also using this concept of Business Class is Cathay Pacific. It is due to roll out early next year and will prove competition with Air New Zealand especially on the new formed Auckland–London via. Hong Kong Route. However, Cathay Pacific has not stated which route the new Business Class is to fly on.
Long-haul services
The first refurbished 747-400s started flying the NZ7/8 services between Auckland and San Francisco in August 2005. Since then all 747-400s have been refurbished, and these fly the daily non-stop Auckland–Los Angeles service (NZ5/6) and Auckland to London Heathrow via Hong Kong flight, (NZ38/39)
Six new Boeing 777-200ER aircraft are used on the Auckland to London Heathrow (via Los Angeles) (NZ1/2) Osaka (NZ97/98), San Francisco (NZ7/8) and Tokyo (NZ90/99) routes (and some Auckland- Melbourne, Sydney or Brisbane services).
On June 18 2006 Air New Zealand announced the flight schedule for a new non-stop route into Shanghai's Pudong Airport, to commence on November 6, using new Boeing B777-200ER. It will operate three times a week.
On July 12 2006 Air New Zealand announced that its daily Auckland–Singapore Boeing 777-200ER service would be terminated from 02 October 2006 due to mounting losses. It also announced that as of 29 October, 2006 the Auckland–Los Angeles–London Heathrow services (NZ2/NZ1) would be operated by Boeing 777-200ER aircraft, although peak December/January services would still be operated by Boeing 747-400s. In addition, the seasonal Christchurch–Los Angeles service would not be re-instated.
*Please note that these dates are subject to change
On 30 October 2006 Air New Zealand began operating a shuttle flight, NZ302, between Christchurch and Auckland for passengers connecting to long-haul flights. This Boeing 737-300 flight uses the international terminals, with passengers clearing customs in Christchurch. and transferring to their onward flight at the Auckland international terminal. The Shuttle flight connects with all flights to London Heathrow, Hong Kong and Shanghai and some flights to Los Angeles and Apia. The flight departs Christchurch at 8.45pm and arrive in Auckland at 10.05pm. It returns to Christchurch the following morning, connecting with flights from Perth, Western Australia, Tonga, Los Angeles and San Francisco.
On 20 February 2007, Air New Zealand announced the order of four more Boeing 787-9 aircraft, bringing the total order to eight aircraft. Delivery of the four most recently ordered aircraft will take place between 2011 and 2013. In the announcement, CEO Rob Fyfe spoke of possible new destinations in Africa, India, the Americas, and Asia, which are now possible due to the long range of the 787-9[5].
Also in late February 2007, Air New Zealand announced a new non-stop service [6] between Auckland and Vancouver, British Columbia, Canada. The service will be operated by Boeing 777-200ER aircraft and will begin operation in November 2007.
On June 26 2007 Air New Zealand announced that its Boeing 767 and Airbus A320 aircraft will undergo a cabin overhaul (specifically to the IFE systems) so that all its international fleet is equipped with personal entertainment systems in all seats in all classes.
On June 29 2007 Air New Zealand announced that it commences reciprocal codeshares with Shanghai Airlines, and will extend its three times weekly flight to five times weekly. Two days later, Air New Zealand commenced reciprocal codesharing with Air China. [5]
On 3 August 2007 Air New Zealand announced it is buying four Boeing 777-300ER long-haul airplanes and has options on three more B777-300ER aircraft for delivery around 2011[6]. The aircraft were ordered with the intention of replacing the the airlines Boeing 747 aircraft which will begin to be retired around the B777 delivery time.
Lounges
Air New Zealand and its feeder services, trading as Air New Zealand Link, have a comprehensive network of departure lounges at most regional and domestic airports: Auckland, Hamilton, New Plymouth, Napier, Palmerston North, Wellington, Nelson, Christchurch, Queenstown, Dunedin, Invercargill
For International flights, these lounges go under the name 'Koru Club', where a wide range of services (including internet and printer access, showers, business facilities, regional television and light meals) can be accessed by both paid-up Koru Club members and Star Alliance Gold members, together with premium class passengers at Air New Zealand's international focus cities of Auckland, Brisbane, Christchurch, Hong Kong, Honolulu, London Heathrow, Los Angeles, Melbourne, Nadi, Osaka, Papeete, Rarotonga, Sydney, Tokyo, Wellington
Subsidiaries
Air New Zealand has four wholly owned subsidiary airlines — three fully integrated regional airlines (Air Nelson, Eagle Airways and Mount Cook Airline) serving secondary destinations in New Zealand, and Freedom Air, a low-cost international carrier flying between New Zealand and eastern Australia and Fiji.
Air Nelson is based in Nelson, operating Saab Saab 340A and recently acquired Bombardier Q300 aircraft. Flight numbers are in the NZ8000 series.
Eagle Airways is based in Hamilton, operating Beechcraft 1900D aircraft. Flight numbers are in the NZ2000 series.
Mount Cook Airline is based in Christchurch, operating 66-seater ATR 72-500 turbo-prop aircraft. Flight numbers are in the NZ5000 series.
Airpoints
Airpoints is Air New Zealand's Frequent Flyer programme. Members earn Airpoints Dollars™, which they can redeem at face value on any fare on every Air New Zealand ticketed and operated flight. Special redemption rates for long haul Business Class exist for Airpoints Silver, Gold, Gold Elite and Koru Club members.
Tier Status
Members who earn enough Airpoints Dollars on Air New Zealand and Star Alliance partner operated flights are awarded tier status, providing special benefits:
Silver
- One single-use entry coupon to an Air New Zealand operated Koru Club or International Lounge
- One complimentary one-class, one-sector upgrade, which may be confirmed 48 hours prior to travel.
- Priority waitlisting and airport standby
- Priority telephone service
- Preferred Seating
- Ability to purchase discounted longhaul Business Class rewards using Airpoints Dollars
Members also receive Star Alliance Silver status, providing other valuable services with some partner airlines (such as Priority Check-In with Lufthansa at some ports). There have been rumours that NZ have been looking at increasing the benefits of this tier to satisfy the complaints of these members.[citation needed]
Gold
- Two non-transferable complimentary, one-class, one-sector upgrades. Upgrades can be confirmed up to three days before the flight.
- Priority waitlisting and airport standby
- May gift rewards to two nominees which are not part of their household
- Access to all Koru Club and Air New Zealand International Lounges with one guest prior to flights
- Priority boarding on some services
- An additional baggage allowance of 20 kg or one piece, depending on the route flown
- Priority check-in
- Priority luggage handling
- No expiry of Airpoints Dollars while at this tier or higher
- Access to the Premium Service Team when telephoning in, on the priority phone numbers
- Preferred Seating
- The ability to purchase discounted longhaul Business Class rewards using Airpoints Dollars, with extra capacity for Gold and Gold Elite Airpoints members.
- If residing in New Zealand, a subscription to the Gold Airpoints Koru Review magazine
- A hotel/rental car voucher. (This benefit is must be redeemed on Friday to Sunday, and is valid for up to three days.)
Members also receive Star Alliance Gold status, providing a number of guaranteed benefits with other Star Alliance carriers.
Gold Elite
Receive all the benefits of Gold plus
- May bring five guests into the Air New Zealand operated Koru Club and International lounges
- Complimentary Upgrades are transferable and upgrades could clear up to 12 months before the flight
- May gift rewards to up to four different people per year
- Five 24-hour non-transferable valet parking coupons valid at Auckland, Wellington and Christchurch, and with one hotel and one rental car voucher (instead of one or the other for Gold tier)
- A partner card, providing some of the benefits of this status to their partner when travelling on Air New Zealand operated services.
Partners
Star Alliance partners:
- Air Canada
- ANA
- Asiana Airlines
- Austrian
- bmi
- LOT Polish Airlines
- Lufthansa
- Scandinavian Airlines
- Singapore Airlines
- South African Airways
- Spanair
- SWISS
- TAP Portugal
- THAI
- United
- US Airways
Star Alliance Regional partners:
- Adria
- Blue1
- Croatia Airlines
Other airline partners:
- Air China
- Mexicana
- Shanghai Airlines
- Virgin Atlantic
- Freedom Air (redeem only)
- Air Vanuatu (codeshare flights only)
Hotel partners:
- Accor Hotels & Resorts (Australia and New Zealand properties only)
- Sofitel
- All Seasons
- Mercure
- Novotel
- Carlton Hotels & Carlton Crest Hotels
- Choice Hotels (must be a Choice Privileges Rewards member)
- Clarion
- Comfort
- Quality
- Hilton Hotels & Resorts (Double dipping with Hilton HHonors)
- Hilton
- Conrad
- Doubletree
- Embassy Suites
- Hilton Garden Inn
- Hilton Grand Vacations Club
- The Walforf=Astoria Collection
- IHG (must be a Priority Club member)
- InterContinental
- Crowne Plaza
- Hotel Indigo
- Holiday Inn
- Express by Holiday Inn/Holiday Inn Express
- Staybridge Suites
- Candlewood Suites
- Langham Hotels International
- Millennium, Copthorne & Kingsgate Hotels & Resorts (New Zealand properties only)
- Mirvac Hotels & Resorts
- Starwood Hotels & Resorts (must be a Starwood Preferred Guest member)
- Sheraton
- Westin
- St. Regis
- W
- Four Points by Sheraton
- Le Meridien
- The Luxury Colletion
- The Ascott Hotel.
- Small Luxury Hotels of the World
- Stamford Hotels
Financial partners:
New Zealand
- Bank of New Zealand (GlobalPlus Visa, MasterCard, and American Express, GlobalPlus home loan, All Blacks MasterCard, BNZ Gold Rewards, BNZ Platinum Rewards)
- ASB True Rewards
- Westpac hotpoints
- Diners Club
- Wrighton Rewards
- Flybuys (available to GlobalPlus customers only)
Australia
- ANZ Rewards
- BankWest Extra Rewards
- Westpac Altitude Rewards
- Diners Club
Leisure partners:
- Cruise Holidays NZ Limited
Vehicle Rental partners:
- Avis
- Hertz
- Budget Car and Truck Rental
- Maui & Britz Campervans
Retail partners:
- DFS Galleria New Zealand
Insurance:
- Air New Zealand Holidays Travel Insurance
Destinations
Fleet
The Air New Zealand fleet consisted of the following aircraft at 3 August 2007: [7]
| Type | Total | Passengers (Business Premier/Pacific Premium/Pacific) |
Routes | Notes |
|---|---|---|---|---|
| Airbus A320 | 12 | 152 (8/0/144) | Domestic, Tasman & Pacific flights | Operated by: Zeal320 |
| ATR72-500 | 11 | 66 (0/0/66) | Domestic flights | Operated by: Mount Cook Airline |
| Beechcraft 1900D | 17 | 19 (0/0/19) | Domestic flights | Operated by: Eagle Airways |
| Boeing 737-300 | 14 (3 Orders) |
136(0/0/136) | Domestic & some Pacific flights | 3 To be brought in over the next few months |
| Boeing 747-400 | 8 | 386 (46/31/309) | Long-haul international | To be replaced by 777-300ER in 2011 |
| Boeing 767-300ER | 5 | 234 (24/0/210) | Semi-long haul | Two to be phased out over two years |
| Boeing 777-200ER | 8 | 313 (26/18/269) | Long haul international | |
| Boeing 777-300ER | (4 orders) | Long haul international | Holds three options. Deliveries from 2011 | |
| Boeing 787-9 | (8 orders) | Long haul | Deliveries from 2010-2013 | |
| Bombardier Q300 | 17 (4 Orders) |
50 (0/0/50) | Domestic | Operated by: Air Nelson |
| Saab 340A | 3 | 33 (0/0/33) | Domestic | Operated by: Air Nelson |
| Total number of aircraft | 95 (19 orders) |
Updated: August 2007 |
Previously operated
- De Havilland Fox Moth (NAC)
- De Havilland Dragon Rapide (NAC)
- De Havilland DH86 Express (NAC)
- De Havilland Heron (NAC)
- Short S-30 Empire flying boats: 2 (3rd ordered but diverted due to World War II) (TEAL)
- Short Sunderland (NAC)
- Short Sandringham flying boats: 4 (TEAL)
- Short Solent flying boats: 5 (TEAL)
- Douglas DC-6: 3 (TEAL)
- Lockheed Electra 3 (NAC)
- Lockheed L-188 Electra: 5 (TEAL)
- Lockheed Lodestar: 12 (NAC)
- Lockheed 14 (NAC)
- Douglas DC-3: 29 (NAC)
- Vickers Viscount: 5 (NAC)
- Fokker F27-100 Friendship: 13 (NAC)
- Fokker F27-500 Friendship: 11
- Douglas DC-8-50: 7
- McDonnell Douglas DC-10-30: 8
- Boeing 737-200: 24
- Boeing 747-219: 5
- Boeing 767-200: 7
- Fairchild Metroliner
- Embraer Bandeirante
Livery
The Māori symbol on the tail of Air New Zealand is known as the koru. It is a stylised representation of a fern frond unfolding, and signifies new life, growth and renewal.
The koru was used on the prows of the early Polynesian canoes that sailed the Pacific with its many islands. It is now seen on the tail of Air New Zealand's fleet as it wings its way over the same waters, not only still linking the Pacific peoples, but also reaching right across Asia and the Atlantic to London.
The koru was first applied to the tail of Air New Zealand aircraft with the arrival of the DC-10 aircraft in 1973, and has remained ever since. The current aircraft livery was adopted in 1997.
A special livery featuring an image of the All Blacks front row of Carl Hoeft, Anton Oliver and Kees Meeuws was used on the aircraft that took then to the 1999 Rugby World Cup.
The koru also appears on the Air New Zealand house flag (see illustration) and flies at international airports such as Los Angeles Airport.
A redesigned logo was unveiled on March 21, 2006. The new logo will be progressively introduced over the next year in all advertising, signage and stationery and on planes.
In 2002 and 2003 Air New Zealand marked its position as "the official airline to Middle Earth" by decorating three planes with The Lord of the Rings imagery, applied as giant decals (while the film is as thin as clingfilm, the decals weighed over 60 kg). The decals featured actors from the The Lord of the Rings film trilogy against backdrops of New Zealand locations used for in the films. PR Newswire About Movies
Air New Zealand is title sponsor of the domestic rugby club competition, the Air New Zealand Cup.
See also
External links
- Air New Zealand
- Air New Zealand Fleet Age
- Air New Zealand Data & Statistics
- Air New Zealand Jet Fleet Detail
- Air New Zealand company history
References
- ^ a b c "Directory: World Airlines". Flight International. 2007-03-27. p. 64.
- ^ "Air New Zealand History" (pdf). Air New Zealand. p. 20. Retrieved 2007-02-28.
- ^ Daniel, Zoe (2001-09-04). "Virgin Blue boss jokes about buy-out deal". ABC Radio National PM. Retrieved 2007-08-22.
- ^ http://www.abc.net.au/pm/stories/s367051.htm
- ^ http://www.airnz.co.nz/aboutus/mediacentre/pressreleases/airnz_commences_agreement_with_shanghai_airlines_29jun07.htm
- ^ [1]
- ^ http://www.airnewzealand.co.nz/aboutus/fleet/default.htm Air New Zealand - About Us - Fleet]
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