Qatar Airways's Q-suite. New cabin product rather than new airlines will be turning up in Auckland. Photo / Greg Bowker.
Qatar Airways's Q-suite. New cabin product rather than new airlines will be turning up in Auckland. Photo / Greg Bowker.
For the past few years, Kiwis have been enjoying what's been dubbed "the golden age of travel" — more airlines piling into New Zealand, new destinations and cut-throat competition leading to record low fares.
Figures out today show that more than 3 million overseas trips were taken by Kiwis in the year ended October, up 175,100 on the same time last year.
Only 10 years ago, there were fewer than 2 million trips a year.
In the space of two years to the end of 2017, seven new airlines began operating to Auckland Airport and 14 new routes opened up, largely to cater to inbound tourism, which is also booming.
But that surge in new carriers has dried up. No new ones this year, and while airports are making hopeful noises, nothing announced for next year. Although some airlines are increasing capacity on some routes, especially across the Tasman, the trend has been the other way.
Emirates pulled its big A380s off the Tasman this year and scaled back to Bali just months after starting; Air New Zealand has announced it will pull back on some routes (although it will have two new longhaul services by the end of the month); Hong Kong Airlines is reducing flying next year; and in a blow to the holiday market, Air Asia will quit flying between Auckland and the Gold Coast next February.
Throughout the year there has been a succession of baseline price rises, with airlines blaming rising operating costs, especially fuel.
This is being reflected in inflation figures, particularly on domestic routes where there is limited competition. Stats NZ data shows domestic airfares rose 8.1 per cent between the June and September 2018 quarters.
International airfares were up 3.3 per cent in the same period.
The rise in domestic airfares was the largest for any September quarter since 2006.
Early this month Cathay Pacific introduced $120 fuel surcharges on international sectors.
Although fuel prices have retreated dramatically in the past month, they are still nearly 10 per cent higher than they were a year ago and they've already done damage. Jet fuel makes up more than a third of costs for airlines and it's one they can't avoid.
They have also been faced with higher staff costs as the shortage of pilots, engineers and cabin crew bites. Air Asia's New Zealand services would have been marginally profitable at the best of times and they were outside its usual network structure of point-to-point flying - it hop-scotched from Kuala Lumpur through Coolangatta to Auckland.
With higher yielding alternative routes to develop, the decision to quit New Zealand after two-and-a-half years was an easy one. It's done it before, pulling out of Christchurch in 2011 after flying for just over a year.
Hong Kong Airlines will drop its daily service to as few as just three from May, although it will go back to seven days a week next summer. A spokeswoman said the reduction was based on "market forces and operational conditions".
We will see more of these seasonal adjustments as technology allows carriers to more accurately forecast demand. Airlines such as Hawaiian are sensibly turning up capacity when they need to and dropping it back when demand is low in months such as November and May.
This provides opportunities for travellers - a clearer picture of when there are cheap fares to fill planes - but a reminder that those regular services of the past few years may not be available on the day you'd like to travel.
Air New Zealand isn't returning to Vietnam next winter and Dreamliner engine issues forced it to scale back on new Taipei services before they started. It has also reduced flights to Buenos Aires but will next Friday launch its longest and one of its most ambitious routes yet - Auckland to Chicago.
A Cathay Pacific A350-1000. The airline is slated to operate it to Auckland next summer. Photo / Grant Bradley
Tomorrow it will also introduce its new A321neo aircraft to the Tasman, with a significant boost in capacity as it battles with new rival Virgin Australia. That airline today launches a seasonal Auckland-Newcastle service.
More flying to regional centres in Australia may well be something we'll see more of, at times of the year when it makes economic sense for airlines.
Newer and better appointed planes are also here or on the way.
Air Tahiti Nui was the latest to join the Dreamliner club earlier this month; Singapore Airlines will bring an Airbus A350-900 to Christchurch in January; Cathay Pacific has filed an aircraft change to its elegant A350-1000 next summer; and Qatar Airways has plans next year to introduce remodelled Boeing 777-200s on the Doha-Auckland route, with its award winning Q-suites in business class, a game-changer in premium flying.
A deeper dive into the Stats NZ figures shows that while prices surged towards the end of this year, compared to the September 2017 quarter, domestic airfares are up by only 2.3 per cent while international airfares are down 0.4 per cent.
So for now, the golden age of travel rolls on for travellers, but on familiar carriers.
We're not going to see airlines arrive at the same rate as they did for a couple of years.
Worryingly for the travel sector, one reason fuel prices are dropping is because of concern about prospects for global economic growth - critical to airlines.
