Air New Zealand cut long haul capacity by 85 pct

Andrew Cummings
March 19, 2020

Air New Zealand said on Monday it would further cut capacity and look to lay off some permanent employees as the coronavirus outbreak hits global travel demand.

"As NZALPA represent the majority of New Zealand's pilots and almost every air traffic controller in the country, our greatest concern is for the employment and welfare of our members and their families, and that they are fully represented while commercial decisions are made due to the effects of the Covid-19 virus".

Auckland International Airport Ltd suspended its earnings guidance for the current financial year ending June 30, citing the "unprecedented scale" of the border restrictions announced on Saturday.

As for its Tasman and Pacific Island network, the airline said it will "significantly" reduce the capacity between April and June.

Finance Minister Grant Robertson says he is still in talks with national carrier Air New Zealand, which is excluded from a $600 million package for the aviation sector.

The association has just met with Air New Zealand senior management to discuss their network cut announcement.

Air New Zealand is cutting its long-haul capacity by 85%. "We are working on redeployment opportunities for some of our staff within the airline and also to support other organisations".

It also comes as the Qantas Group announced a 90 percent cut in long-haul flying and a whopping 60 percent reduction in domestic capacity.

An Air New Zealand spokesman said the figure of up to 30 per cent was correct. "This includes the executive teams of all of our employer companies".

United Airlines Holdings Inc booked $1.5 billion less revenue in March than the same time a year ago and warned employees that planes could be flying almost empty into the summer, even after severe flight cuts. Air New Zealand's decision follows news over the weekend that American Airlines is suspending all services to Oceania.

S&P Global Ratings downgraded its credit rating on Virgin to B- and placed it on creditwatch negative due to rapidly deterioriating industry conditions spreading from the worldwide market to the domestic market.

"We are now accepting that for the coming months at least Air New Zealand will be a smaller airline requiring fewer resources, including people", Air New Zealand Chief Executive Greg Foran said in a statement.

New Zealand now has eight confirmed coronavirus cases and no fatalities, with the government saying its primary aim is to slow the infection's spread.

Hawaiian is assisting impacted guests by offering travel waivers, re-accommodations on alternative flights or refunds.

It will also suspend its London-Los Angeles service from March 20 (departing from Los Angeles) and March 21 (departing from London Heathrow) through June 30.

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