Bigger planes means cheaper flights, expert predicts

By Belinda Feek

NZ Herald·

17 Apr, 2015 09:13 AM3 mins to read

Air NZ announced today that from 2016 it will increase its total domestic capacity by more than 650,000 seats. Photo / File

Air New Zealand's investment in bigger planes, means more bums on seats, which means cheaper prices for the travelling public, an industry expert says.

Air NZ announced today that from 2016 it will increase its total domestic capacity by more than 650,000 seats.

But not only were the main centres, Auckland, Wellington, Christchurch to benefit, but also the regions, including Taupo, Whanganui, Kerikeri, Napier and Queenstown.

It was the second major announcement from the company in two days, after the revelation on Thursday it is beginning direct flights to Houston, Texas.

Air NZ's chief sales and commercial officer Cam Wallace said the transition of the domestic jet fleet from Boeing 737s to the more modern and larger A320 aircraft was one of the keys behind the move.

"Forecast economic growth is expected to boost domestic demand, particularly in the Canterbury region. And our investment of more than $1.2 billion in new domestic jet and turbo-prop aircraft is enabling us to increase the frequency of flights for our customers and to operate larger aircraft on regional routes where there is sufficient demand," Mr Wallace said.

Simon McKearney, Flight Centre's general manager product, said it was good to see Air NZ focussing on the regions as they would have been feeling the pinch after flights were cut recently.

He was also impressed by the increase in seats to Queenstown, which he believed would have been due to pressure from Jet Star who had been building a solid client base with their consistently cheaper seats.

"They're increasing their seats by about 110,000 to Queenstown which is a good statement from the tourism side and also from the regions there seems to be some good increases in numbers as well."

He said it was more than likely that prices would drop.

"That would be the leading question for most people, and you would have to think, and it's basic economics, the more capacity they have to fill those seats. So it's going to be positive in terms of pricing I would think because their yields would definitely decrease because they've got more seats to fill."

Air NZ was also increasing its flight capacity between Auckland and Whanganui by 35 per cent.