A review of Air NZ's annual report shows the domestic jets are suffering to the tune of $23M. Quite easy for the CEO of the government airline to throw stones knowing full well the National led government cannot afford for the airline to fail - the on flow consequences to an already fragile economy with record deficit would be disastrous.
The lowering of fares on regional is an attempt to secure the market and prevent a new player (PB or JQ) to compete on the government run monopoly.
A quick check of the AirNZ website for flights tomorrow (19 Oct):
CHC-AKL return NZD118 (equates to 8c/ASK) versus CHC-HLZ return NZD614 (equates to 46c/ASK). Figures are rough - any Accountants reading happy to accept corrections. Nonetheless hardly discounted, and still the area that is sustaining the rest of the Air NZ business model.
Last edited by rescue 1; 17th Oct 2009 at 23:33.