KEY POINTS:
The increased cost of fuel particularly affects the ability of airlines to operate on long-haul routes. Air NZ chief executive Rob Fyfe recently told Radio New Zealand National that the airline's decision to replace its Boeing 747 aircraft on the Auckland-Los Angeles-London route with its more efficient 777s would save the airline $100 million on an annual basis. The cost of fuel alone on that route, he said, worked out at $3000 per seat - more than some seats sold for.
Fyfe has disagreed with Qantas CEO Geoff Dixon's assertion that Air NZ would be taken over in the consolidation process. He said the airline was financially well-placed and there was no indication that a government of either hue would sell its majority stake. Air NZ's network focused on New Zealand, and was integral to the tourism industry, but foreign airlines would not necessarily fly the same routes.
In the present aviation climate, New Zealand is clearly susceptible to decisions that foreign carriers may feel obliged to make if they are unable to operate profitably. This seems to have occurred in the case of the Taiwanese carrier EVA Air which has operated non-stop flights to Auckland since 1993. It will suspend its twice weekly service to Auckland from September 1, operating instead three services weekly to Brisbane, connecting there with Air NZ or Qantas services.
Thai Airways International, which has operated from Bangkok to Auckland since 1987, and non-stop since November 2005, may be suspending its non-stop service in October.
Although no announcement has yet been made in New Zealand, last month the Bangkok Post cited Thai's executive vice-president Pandit Chanapai in a report that from October the Auckland flights would revert to operating via Australia - either Sydney or Melbourne.
Meanwhile, Malaysia Airlines has cut its September-October season capacity on the Kuala Lumpur-Auckland route by one flight per week.
