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Air NZ orders $1.8 billion worth of new planes

Air New Zealand signed a deal for 14 new planes from Airbus with a list price $1.8 billion.

CEO Christopher Luxon says the airline will pay discounted price of around $1.6 billion for the aircraft.

The order includes three A321neo, 10 A320neo and one A320, Mr Luxon at a press conference in Doha, where he is attending the International Air Transport Association's annual general meeting.

The neo aircaft will be delivered between 2017 and 2019, while the classic A320 will be supplied early next year.

The A320 series is all singlle-aisle.

Mr Luxon said that the carrier plans to have a fleet of medium-range airliners consisting exclusively of Airbus planes. Airbus's A320 family competes with Boeing's 737.

The planes will be used for Trans-Tasman and Pacific routes, CEO Christopher Luxon said, and will keep the airline competitive with fuel savins o up to 15% or $1.9 million a year.

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Comments and questions

Pity they don't get rid of the shockingly uncomfortable ATRs. Having travelled on the popular Embraer regional jets common overseas, the improvement is just unbelievable.

The Embraer regional jets are a very good aircraft, but the fuel costs for short hauls compared to an ATR TurboProp aircraft and the relatively short flights that we have on domestic flights make it a difficult economic proposition.

Would you be happy paying significantly more to board an Embraer rather than an ATR... how much more would you pay 10%, 15%, 25% or more and would everybody else on the flight be prepared to pay or would they seek an alternative?

There's a reason why most passengers pay the lowest fare class with huge carry ons and it's a worldwide phenomenon... it's a part of the reason that first class has for the most part disappeared from most airlines...

I already do pay more as that is almost invariably the consequence of choosing a time and route flown by a jet to avoid the dreaded ATR.

You will note that these new aircraft are for the main trunk / Trans- Tasman and Pacific routes. Some new uncomfortable ATR's being introduced into the regional network.
Mr Luxon's focus is purely bottom line at the expense of customer service / brand building - look at the past 12 months:
Night Rider flights - Gone
Standby Fares - Gone
Starfish - up to 30% discount for regional frequent fliers - Gone
Masterton service - Gone
Airpoints further eroded.
Regional (monopoly) service is getting worse with constant disruptions and cancellations due to regular breakdowns of ATR's + 1900's, crew unavailability, sickness etc - very easy just to cancel flights in a captive market - taking a business trip from a regional centre these days means not being sure you will return as per your schedule.- the Air NZ brand which was so carefully nurtured after the near disaster of 2001 is rapidly being eroded as management flirt (again) with the disastrous Australian Aviation market via Virgin - history is set to repeat itself.

A very broad and general statement with a certain a mount of pessimism.
Firstly regional flights are those aircraft and those airfares for a reason. Small regional airports and their associated infrastructure, services, ( maintenance, navaids, fire rescue, airport authority and associated landing fees) all in line with requirements set by the CAA, to make those airports legally able to accept commercial aircraft and their services, forward on those costs to the airline that flies into those fields. Small towns as stated above barely have the demand or population to justify one airline to commit to a regular service, pay all those fees and come out with a yield. Hence why major hubs such as Auckland etc, has a sustainable population, demand for not just one but multiple airlines, all whom share the cost of airports and their services, with duty free shops and other businesses also dampening those costs with rental payments. The reason no one else flies to those places is obvious.THERES NO MONEY IN IT.,
Secondly, this time of year disruptions are a normalcy. Not because of crew sickness as they have standby crews for that. But smaller aircrafts ability to fly or auto land in Fog or adverse conditions. Once again airports are to blame here in part. No NZ airports have the ability to provide an auto land service to aircraft in reduced visibility except Auckland. Much investment into the airport is required to make it auto land capable.

I think it is foolish to believe that any airline would blatantly cancel a flight for the excuse it has a captive market. It has an obligation as the national carrier to offer services to those towns. But if no one uses the service, then what's the point. This has been seen and done many times over by different airlines out of Dunedin, Hamilton, Palmerston North. All whom pulled out to lack of demand.

Thanks NZ Made.
Can only call it as I see it as a regionally based frequent flier.
Incidentally I think you will find that Air NZ profits greatly from its monopoly position on the regional network.

Can't agree more. The Air NZ focus is solely on margin.

You also forgot to mention the massive devaluation of the Airpoints program which has slashed status points for most seats.

This is. bet that a plane designed in the 21st century(Comac 919) with new light weight materials wont have significantly better fuel economy than planes designed decades ago but with a new engine(A320neo)
The Chinese Comac 919 which is due to fly end of 2015 may not be on Air New Zealand's radar but it is certainly on Airbus's and Boeing's radar.

Any source other then Boeing is a gamble on Passenger safety all for the mistaken believe that cheaper is a quick trip to the promise land of huge profits. Boeing has years of experience in built in passenger safety not to mention Aircraft reliability ie they stay in the air other plane manufacturers have yet to prove .But then hey that's why we have so many gullible kiwis.

This is one of Boeings favourite arguments, that the competition is unsafe or unreliable.
Look at the american space industry now where the Atlas rockets will stop flying because they are using russian engines. Elon Musk has a perfectly good rocket which has flown many times safely which could loft many of the air force satellites. The problem is Boeing does not like competition and they are going to get the US government to finance new American engines even though Elon has a prefectly good rocket. Elon is really unhappy and is now sueing the air force.
The moral of the story is that large American corporations will go to almost any lengths to protect their business.

Airbus or Boeing - both have proven records over decades.

1. 0.0 - Airbus A340
2. 0.001 - Boeing 777
3. 0.07 - Boeing 747-400
4. 0.08 - Airbus A320 (includes A318, A319, A321)
5. 0.09 - Boeing 737 current generation (-600, -700, -800, -900)

Airbus have been around long enough that I don't think that argument holds any water.

On the other hand the Air NZ A320 that just took me to Melbourne rattled and shook from the moment it left the terminal in Auckland to when it stopped moving in Melbourne - not something I experience with the B767's.

Hello......its a business in a little village only big enough for 1 player

Nothing new about new planes way way more fuel efficient

AirNZ is no longer a government department - it competes with other airlines + modes of transport

Profits are only way up after key competitor left LAX route

What do you want you Naysayers.
A profitable airline that returns a profit to the shareholders either the public or government or in Air new zealands case both, or a QANTAS which has had to cut services and staff and is 600M in the red.
Air NZ needs some competition on the AKL to LAX and SFO routes but main trunk NZ seems to thrive on the competition.
Maybe Emirates AKL to LAX would be agood alternative airline.

Let us hope that never happens. I don't understand people who choose to back a gloating Arab Mega Airline with hundreds of double deckers on order and has oil wells backing it over our national airline. These airlines choose to bully their way around the globe with their huge financial funding. Have some pride in our national airline for the size country we are and the awards they have won. I say it is a much needed margin for a small airline over mega carriers who's will is to dominate the world market. Be afraid if they eventually have a monopoly.