Air New Zealand bookings surge, outlines big expansion plans

Air New Zealand is taking a ”wait and see” stance on the new Omicron Covid variant, which it says hasn’t had any impact on international bookings.

The airline continues to plan for a booming network next year.

its chief customer and sales officer Leanne Geraghty told a tourism industry gathering today that its domestic network is set to be bigger than pre-Covid, and the airline is rebuilding its presence in the United States where it plans to resume passenger flights from next April as it restores much of its international network.

She told the Tourism Industry Aotearoa virtual summit that since the announcement of the staged reopening of borders last week, bookings had surged to Australia.

In the 48 hours following the Government announcement of new border settings from mid- January and February next year 25,000 international seats were booked.

”Friday, it felt like the clouds had actually begun to lift and we were seeing some brighter days ahead. Come Saturday with the news of Omicron we had further uncertainty thrust upon us all,” she said.

It could take up to two weeks for scientists to establish the seriousness of the new variant and whether it can outflank vaccines and treatments used now.

But New Zealand’s tight international border put this country in a better position than many others and because that MIQ-free travel wouldn’t start for New Zealanders until mid-January, she said booking patterns hadn’t been affected.

Nervous investors took a different view with Air New Zealand shares falling nearly 4 per cent in early trading to $1.52 as travel and tourism companies suffered on markets in this country and around the world.

Geraghty said the pandemic had changed consumer behaviour and changed the aviation industry irreversibly.

‘It’s a given us a really great opportunity and a chance to accelerate some of the plans and the strategies we had in motion before Covid was set upon us.”

She said Air New Zealand imagined 2022 as being the year of strong recovery.

It was hoped Air New Zealand would be operating its non-stop services between Auckland and New York (from late October) and had plans to return to destinations such as Fiji, Tahiti, Chicago, Tokyo and Sydney. The airline had no short-term plans, however, to return to London or Buenos Aires.

She said it envisaged a domestic network that was booming and in which passengers were able to use new digital tools the airline was investing more in.

”This is where our sights at Air New Zealand are firmly set – a booming and thriving domestic and international business underpinned by getting the basics right.”

Domestic flying was about a third of Air New Zealand’s business pre-Covid but had performed strongly throughout the pandemic.

”Lockdown after lockdown after lockdown we have experienced our domestic network bouncing back stronger than ever and while Auckland currently remains cut off through until the 15th of December, the rest of our network around the country is operating at 100 per cent of pre-Covid levels and there have been periods in fact where we’ve been operating above that.”

This summer holiday period, New Zealand flights are operating at nearly 31 per cent higher than last year.

By March next year its domestic network would be bigger than pre-Covid, and seat capacity up by 30 per cent on March 2021 – on average, of 65,000 more seats available per week.

The airline would put 26 per cent more capacity into smaller regional centres by next March and she said this was likely to spread across the existing network, but Geraghty told the Herald resuming flights to areas the airline had pulled out of was being reviewed.

With the opening of internal borders around Auckland in a fortnight Air New Zealand was requiring all passengers to be vaccinated or test negative for Covid-19 before flying.The Government’s My Vaccine Pass would feed information into the Air New Zealand app to make travel more seamless and there was good progress towards this going live on December 8, said Geraghty.

On its international network the strongest bookings since last week had been to Sydney, North America and Rarotonga which opens to quarantine-free travel from mid-January.

Teams across the business have been working non-stop to make sure the airline’s operation is ready for the first quarter of next year, she said.

Cargo flights operating during the Covid period meant Air New Zealand had been able to “keep the lights on” in the majority of its long-haul markets.

“Opening these sectors up to carrying passengers is a relatively easy thing to do.”

The airline was rehiring staff in the United States and had just re-signed office space in Los Angeles for the next seven years.

”Our restart marketing development and brand plans are very, very well defined and ready,” she said.

A big part of Air New Zealand’s international strategy was bringing high-value premium leisure passengers in from North America and Asia and its premium cabins in new Dreamliners set for delivery from October 2023 would appeal to that market.

The future aircraft cabin experience (face) team had been working on the new product since 2017 and this would be unveiled in the lead up to being fitted on the new planes. The sleeping pods designed for economy class passengers and unveiled early last year were still being assessed for deployment in planes, Geraghty said.

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