Yet more French aeroplanes for Air New Zealand

Air New Zealand tipped to spend big

By ROELAND VAN DEN BERGH - BusinessDay at The Dominion Post | 5:00AM - Wednesday, 19 October 2011

FLEET: One of Air New Zealand's current ATR72-500s. — STACY SQUIRES/The Press.

AIR NEW ZEALAND is expected to spend hundreds of millions of dollars on more planes to lift capacity on key domestic routes and deter competitors from breaking its regional monopoly, in a deal to be announced today.

Industry sources suggest that the more efficient and capable next-generation ATR72-600 could be added to the fleet, allowing Air New Zealand to increase capacity on larger regional routes.

House of Travel retail director Brent Thomas said additional 68-seat ATRs could add more flights to centres that lacked enough services.

That would encourage more people to fly and potentially lead to lower fares, Thomas said.

Regional fares were still seen as too high by many travellers, in some cases costing more than a flight to Australia, he said.

The ATR-600 series promise greater comfort and luggage space, are more fuel efficient and boast the latest technology in the cockpit. Air New Zealand shelved a US$300 million (NZ$375m) plan for 15 larger turboprops to replace its fleet of 11 ATR 72-500s three years ago. Instead, it bought seven of the existing aircraft it had been leasing.

At the time three options were considered: the French-made ATR72-600, which is the newer version of the current 500 model; Canada's 74-seat Bombardier Q400, a bigger version of the Q300 flown by subsidiary Air Nelson; and Brazil's Embraer 70-seat E-170 regional jet.

Centre for Aviation analyst Will Horton said: "The experience from Virgin Australia is that the ATR72's economics are better than the Q400."

Air New Zealand owns nearly 20 per cent of Virgin Australia and the airlines have a strategic alliance on the Tasman.

Analysts said expanding the fleet would be a defensive move against a potential competitor like Jetstar targeting Air New Zealand's monopoly on the regional network.

The regional network was considered to be a profitable component of the airline's business, though it does not break the figures down in its financial accounts.

The ATR72-500 fleet has a relatively young average age of about 10 years and is popular with passengers.

http://www.stuff.co.nz/business/industries/5810162/Air-NZ-tipped-to-spend-big

Air NZ to spend $340m on new planes

BusinessDay at The Dominion Post | 1:49PM - Wednesday, 19 October 2011

DOMESTIC FLIGHTS: The regional network was considered to be a profitable component
of Air NZ's business. — Photo: The Dominion Post.

AIR NEW ZEALAND is spending US$270 million ($340 million) on seven new-generation ATR72-600 aircraft with purchase options for a further five.

As tipped by BusinessDay this morning, Air New Zealand chief executive Rob Fyfe said today's announcement, which is subject to contract signing, will significantly boost air service connections to regional New Zealand.

"This order potentially doubles the size of Air New Zealand's ATR fleet and will put a further two million seats into the New Zealand regional market annually. For our customers that will mean a big increase in the number of business timed seats and seriously cheap grabaseat fares we have on regional routes every day."

The first of the more fuel-efficient 68 seat ATR72-600 aircraft will be delivered to Air New Zealand in October 2012, followed by a second in December that year, two in 2013 and another each year for three years. The five purchase options are available for delivery between 2014 and 2016.

This follows Air New Zealand's investment in 23 Q300 aircraft over the past six years worth more than $450m at list price and the purchase from lease of the majority of the existing ATR72-500 fleet over the past eighteen months.

House of Travel retail director Brent Thomas said this morning that the additional ATRs could add more flights to centres that lack enough services. This would encourage more people to fly and potentially lead to lower fares, he said.

http://www.stuff.co.nz/dominion-post/business/5814624/Air-NZ-to-spend-340m-on-new-planes