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zkojq
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Re: New Zealand Aviation Thread - November 2017

Tue Nov 14, 2017 7:16 am

Didn't seem to get mentioned in the last thread, but ZK-ZQA has left the Jetconnect fleet and now flies for Qantas mainline (VH-VZF).
First to fly the 787-9
 
ZK-NBT
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Re: New Zealand Aviation Thread - November 2017

Tue Nov 14, 2017 7:44 am

planemanofnz wrote:
zkojq wrote:
New Zealand is a substantially smaller market.

The size of our market is only one consideration - you fail to mention others, like competition (which New Zealand has a lot less of, with no service from 5J, D7 (long-haul), JQ (long-haul), LJ, OD, TZ, or various other low-cost long-haul carriers, that are present throughout Australia), as well as yield (with New Zealanders far less wealthy than Australians).

But nevertheless, regarding size, I do not think that this is a major barrier to a subsidiary proposal - ultimately, there are two route types for which the subsidiary would fly:

1. Out-bound
This includes AKL - DPS / HKT / HNL / LAS / SGN. NZ already sustains the majority of these routes, showing that New Zealand's catchment area is sufficiently large. For further destinations, like LAS, NZ's new subsidiary could, to some degree, also rely on Australian connections (just as JQ markets its Japan services to the New Zealand market).

2. In-bound
This includes AKL - KIX / MNL / NGO / TPE and CHC - ICN / NRT. For these, the size of New Zealand's catchment area is irrelevant - it is the size of the Asian markets that counts. In these markets, New Zealand competes with Australia for tourists, and so if Australia offers low-cost services whereas we do not, then we are disadvantaged.

zkojq wrote:
As far as NZ-Japan goes, HND is the premium market for business travellers going to Tokyo whilst those connecting to other parts of Japan get routed through NRT (for domestic connections). I understand that the Narita route still carries plenty of premium traffic because of this, so operating the NRT service with a LHLC subsidiary might not be such a great idea.

I never suggested moving NRT - AKL to a low-cost subsidiary carrier - if you look at my map again, you will see that the proposed route is in fact NRT - CHC. CHC would be similar to CNS and OOL in Australia - largely in-bound and leisure focused - so just as JQ is used for CNS and OOL, a low-cost carrier could be used here for CHC too.

zkojq wrote:
But QF/JQ and SQ/TZ are the only ones who have managed to make LHLC work in tandem with a full service carrier.

Yes - QF and SQ are the most relevant comparisons here - not European or North American carriers - as NZ, like QF and SQ, operates in Asia Pacific.

Cheers,

C.


Asia Australia is generally a 7-9hr flight to the East Coast bar China which is a bit further. NZ is 10-12 bar China. Australia is medium haul most of it where all of NZ is long haul, I’d say a big difference in operating costs. It will be interesting to see if NZ are looking at the Norwegian model, how long have they actually been running long haul and is it actually profitable? Plenty to consider.

Re NRT I was thinking with EZE connections would they use a LCC there? You need 2 flights to connect both ways even if they are from different airports. How much premium traffic is there to TYO? 77E’s did NRT last summer and HND the year, HND is only 3 weekly. More 789’s are short or needed elsewhere? HNL gets 77E’s in school holidays and this summer for a few months due more premium traffic at those times.

Agree a LCC for NZ could be used ex CHC to give that 1-2 more links.
 
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VirginFlyer
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Re: New Zealand Aviation Thread - November 2017

Tue Nov 14, 2017 7:50 am

VirginFlyer wrote:
planemanofnz wrote:
A number of posts from the previous thread were deleted today - for example, one linking to an article about Barrier Air.

Can someone please elaborate as how these posts breached the forum's standards?

Cheers,

C.

Hmmm - I recall the Barrier Air post - not sure what the issue was - I would recommend you contact the moderators and enquire. On that post, it wasn't that newsworthy though - I believe the Partenavia has been out of service for some time now, I guess someone just noticed.

V/F

While driving along Puhinui Road today, I believe I saw the Partenavia in question in the process of being scrapped. Here's an article about it by the way: http://3rdlevelnz.blogspot.co.nz/2017/1 ... e.html?m=1

planemanofnz wrote:
2. Add sea-plane / ship terminal

Luxury visitors will visit islands, like Waiheke, or beach-based accommodation - boats and sea-planes mitigate road traffic:

Image

NZ321 wrote:
Re planesman's comments above about seaplanes - you only need look at Kenmore Air of Seattle (operates from both Lake Union and Lake Washington) and Hyackair of BC to see what's possible with sea planes. They have an extensive network of routes in the gulf islands and inside passage between Vancouver Island and the Mainland. I see this is an opportunity for New Zealand, both for Auckland, Bay of Islands, Rotorua lakes, Nelson / Marlborough. Getting to points on the Barrier, Coromandel, Bay of Plenty, Rotorua Lakes, Golden Bay, The Sounds or in the Bay of Islands could be so much more convenient with the advent of such transport. Air fares are not as steep as you might think - because these airlines have carved out a niche and offer both scheduled and charter flights. But no seaplane terminal is planned for Auckland harbour as far as I know. Just a couple of old Beavers plying the skies at the moment from a jetty by North wharf. Missed opportunity in IMHO.

NPL8800 wrote:
As for the sea-planes, a nice idea and certainly a niche that could probably be exploited further, however the places mentioned are all easily accessible by helicopter and I can't imagine that there are too many places in this country that would be accessible to a sea-plane and not a helicopter.

planemanofnz wrote:
There are a few factors at play here - sea-planes can move larger groups of people (and their luggage) quicker than helicopters, which would be an important consideration, for example, if it was a family that was coming. Another point to note is that some people might feel safer in a sea-plane, than a helicopter (irregardless of whether or not this is a valid point of view).

Although sea-planes have a much greater range than helicopters, I doubt that this would be much of a factor - helicopters can still reach most of the North Island lodges from AKL.

In any event, why not have an integrated terminal for both sea-planes and helicopters, connected to AKL? AKL's access to a large body of water is one of its key advantages - this is not something that, say, MEL or ZQN can offer. An interesting precedent for such a terminal could be that at MLE, in the Maldives (albeit AKL's would not need to be as large).

Interesting discussion about sea planes, though to be honest I can't see it happening at Mangere; how much dredging work would be needed to create a navigable movement area for sea planes at all tide conditions? I would suggest the shallowness of the water around the airport also rules out the other part of Planemanofnz's suggestion; a ship terminal). Perhaps a more practical option would be amphibious aircraft (such as the Cessna Caravan) which could land on land at Auckland, and on water at the other end. That said, would there be many places where it would make sense? Great Barrier is already served by two airports, plus there are several dotted around the Coromandel Peninsula. Bay of Islands maybe, although Kerikeri airport isn't particularly far from Paihia. Personally if I were investing money I would put it into the likes of Barrier Air or Fly My Sky to expand services to Coromandel and other places, rather than into a regular public transport seaplane operation out of Mangere. One thing to note about the Maldives sea plane operations is that they are not there as a "nice to have"; they are there because the Maldives are a group of small islands and it is the only practical way to get around, and for the most part is underpinned by the hotel transfer business. This isn't so much a reality here. Perhaps a starting point to what Planemanofnz is describing would be one luxury lodge type place setting up a seaplane transfer operation?

Looking back to the past, Sea Bee Air used to fly Mechanics Bay to Waiheke, Great Barrier, Kawau and Paihia back in the day - see http://3rdlevelnz.blogspot.co.nz/2011/1 ... d.html?m=1

V/F
It is not for him to pride himself who loveth his own country, but rather for him who loveth the whole world. The earth is but one country, and mankind its citizens. —Bahá'u'lláh
 
planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Tue Nov 14, 2017 9:27 am

ZK-NBT wrote:
Australia is medium haul most of it where all of NZ is long haul

There are plenty of flights on JQ (in bold and underline) that would be considered long-haul, and comparable to potential NZ LHLC routes, such as:

- AKL - DPS: 4,191 mi
- AKL - HNL: 4,389 mi
- MEL - BKK: 4,546 mi
- AKL - MNL: 4,979 mi
- MEL - NRT: 5,061 mi (recently given to QF)
- SYD - HNL: 5,067 mi
- MEL - CGO: 5,351 mi
- AKL - SGN: 5,502 mi
- MEL - HNL: 5,505 m
- AKL - KIX: 5,535 mi

Cheers,

C.
 
planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Tue Nov 14, 2017 9:38 am

Samoa Airways has finally arrived in AKL:

Image

See: https://www.stuff.co.nz/travel/98882117 ... ral-flight.

It is great to see yet another carrier at AKL - I wonder if WLG or CHC would also be considered by the airline?

++++++++++++++++++++++++++++++++++++

Philippine Airlines and Tourism New Zealand have signed an MOU, to increase the amount of Filipino tourism to New Zealand.

See: http://www.gmanetwork.com/news/money/co ... ism/story/.

I hope that the new non-stop AKL - MNL service will yield good results - I wonder if Air New Zealand would be interested in code-sharing on the service?

Cheers,

C.
 
planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Wed Nov 15, 2017 3:10 am

Visitor arrivals to New Zealand continue to grow at a strong rate - up 10% in the past 12 months.

Largest source markets:
- Australia: +6.2%
- China: +0.3%
- US: +26.4%


See: https://blueswandaily.com/new-zealand-v ... in-201617/.

It is interesting to see that growth from China has cooled off, despite many new Chinese flights.

Despite this, IMHO, there is still room for flights to the likes of KMG, TAO, XMN and elsewhere.

Cheers,

C.
 
planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 1:17 am

While D7 is said to be considering ADL, CBR and CNS, it has not expressed an intention to de-tag AKL, or to serve CHC or WLG.

See: https://blueswandaily.com/airasia-x-con ... nd-cairns/.

I wonder how D7 is doing at AKL - does anyone know?

Cheers,

C.
 
BigTexFlyer
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 1:21 am

Any update on DEN, EWR/JFK, LAS, ORD, PDX, it SEA?
 
ZK-NBT
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 6:25 am

planemanofnz wrote:
While D7 is said to be considering ADL, CBR and CNS, it has not expressed an intention to de-tag AKL, or to serve CHC or WLG.

See: https://blueswandaily.com/airasia-x-con ... nd-cairns/.

I wonder how D7 is doing at AKL - does anyone know?

Cheers,

C.


No idea how they are actually doing at AKL but they have in the past said they would like to serve it non stop from KUL, and would reconsider CHC probably via OOL, I could see a 4 weekly OOL-CHC and 3 weekly OOL-WLG or something with a daily non stop to AKL, although the A339NEO would be better than the current A333CEO.

BigTexFlyer wrote:
Any update on DEN, EWR/JFK, LAS, ORD, PDX, it SEA?


Nothing public, I think an announcement 2”will happen in the next 2-3 months if they plan to launch something late next year. Certainly won’t be NYC, I’d still pick ORD well above any of the others you lost due UA hub.
 
Qantas16
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 7:46 am

ZK-NBT wrote:
No idea how they are actually doing at AKL but they have in the past said they would like to serve it non stop from KUL, and would reconsider CHC probably via OOL, I could see a 4 weekly OOL-CHC and 3 weekly OOL-WLG or something with a daily non stop to AKL, although the A339NEO would be better than the current A333CEO.


I think you're right about it being better suited to A339. Whilst I realise MH flies AKL-KUL direct with the A333, it has ~90 less seats than D7s and I think MH is pushing it as it is.

Interesting idea r.e. KUL-OOL-CHC/WLG, it would certainly be a logical choice if AKL-KUL is made direct.
 
NZ321
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 9:04 am

Qantas16 wrote:
ZK-NBT wrote:
No idea how they are actually doing at AKL but they have in the past said they would like to serve it non stop from KUL, and would reconsider CHC probably via OOL, I could see a 4 weekly OOL-CHC and 3 weekly OOL-WLG or something with a daily non stop to AKL, although the A339NEO would be better than the current A333CEO.


I think you're right about it being better suited to A339. Whilst I realise MH flies AKL-KUL direct with the A333, it has ~90 less seats than D7s and I think MH is pushing it as it is.

Interesting idea r.e. KUL-OOL-CHC/WLG, it would certainly be a logical choice if AKL-KUL is made direct.


What do you mean by MH is pushing it?
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NZ321
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 9:10 am

It's interesting to note that visitor arrivals from the USA are up 26%. Can we take this to mean that UAL and AA commencing service has not significantly eroded NZ loads, rather grown the market? I wonder about yields. I don't sense NZ is significantly discounting a large number of seats in response to the arrival of UAL and AA. Thoughts? Maybe these statistics bode well for future NZ expansion into US.
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ZK-NBT
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 9:15 am

NZ321 wrote:
Qantas16 wrote:
ZK-NBT wrote:
No idea how they are actually doing at AKL but they have in the past said they would like to serve it non stop from KUL, and would reconsider CHC probably via OOL, I could see a 4 weekly OOL-CHC and 3 weekly OOL-WLG or something with a daily non stop to AKL, although the A339NEO would be better than the current A333CEO.


I think you're right about it being better suited to A339. Whilst I realise MH flies AKL-KUL direct with the A333, it has ~90 less seats than D7s and I think MH is pushing it as it is.

Interesting idea r.e. KUL-OOL-CHC/WLG, it would certainly be a logical choice if AKL-KUL is made direct.


What do you mean by MH is pushing it?


The A333 takes a good hit on AKL-KUL like D7 used to on CHC-KUL, though not as bad with 90 less seats on MH vs D7.

NZ321 wrote:
It's interesting to note that visitor arrivals from the USA are up 26%. Can we take this to mean that UAL and AA commencing service has not significantly eroded NZ loads, rather grown the market? I wonder about yields. I don't sense NZ is significantly discounting a large number of seats in response to the arrival of UAL and AA. Thoughts? Maybe these statistics bode well for future NZ expansion into US.


I would say it’s mainly growth, NZ would have to cut a bit of capacity otherwise. No idea on yields but again NZ seem to be doing fine. UA/NZ is a JV anyway so replaces some of the previous NZ capacity on the route. Still a highly seasonal market, it would be nice to see DL enter.
 
NZ321
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 9:28 am

Re KUL-NZ. Understand your point now.

Agreed would be nice to see DL at AKL. Either from LAX or SEA. Don't rate the chances of SLC. Actually, I don't rate chances of DL coming to AKL at all really. They don't seem serious about the Pacific in the way UAL are and AA appear to be. Their capacity seems to have dropped since NW days. The de-hubbing of NRT probably contributes. They exited BKK. Reduced Singapore. Didn't resume KUL. Their focus is mainly China, Korea, Japan. And they seem to be routing more flights out of SEA rather than nonstop from ATL and DTW with significant adjustments for seasonal frequency such that some routes are minimal in the off season. They haven't expanded frequency to Australia after how many years? All in all, a conservative approach to trans-Pac and Down Under. Their focus seems to be on Central-South America and Trans-Atlantic. If the AA-QF JV is approved we could see AA operating DFW-AKL. But I'd say more likely is a year round LAX-AKL from AA and that's about it, apart from HA service. So NZ have a reasonably clear run ahead of them in terms of future expansion without compromising capacity on existing routes. Interesting times.
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planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 9:28 am

NZ321 wrote:
It's interesting to note that visitor arrivals from the USA are up 26%. Can we take this to mean that UAL and AA commencing service has not significantly eroded NZ loads, rather grown the market? I wonder about yields. I don't sense NZ is significantly discounting a large number of seats in response to the arrival of UAL and AA. Thoughts? Maybe these statistics bode well for future NZ expansion into US.

If you look at NZ's '2017 Annual Results Analyst Presentation,' you can see:

- Page 6: Americas "Exceeded expectations" (whereas for Asia, there was "Continued competitive pressure")
- Page 11: "Yield pressure driven by" ... "Competition from new carriers in U.S."
- Page 19: For North America, "Strong, underlying demand continues"

See: https://p-airnz.com/cms/assets/PDFs/air ... tation.pdf.

Then, if you look at NZ's '2017 Financial Results,' you can also see:

- Page 9: Overall revenue from "America" declined from $831M (2016) to $729M (2017)
- Page 47: Passengers carried on "America and Europe" services increased from 1,138,000 (2016) to 1,198,000 (2017)

See: https://p-airnz.com/cms/assets/PDFs/air ... esults.pdf.

All in all, it looks like NZ's North American flights are doing well, despite increased competition.

Cheers,

C.
 
NZ321
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 9:29 am

Thanks Planesman. Helpful info.
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NZ321
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 9:57 am

I have just checked available NZ fare Premium Economy and Business SIN-AKL for February and March. Premium economy is 3,300 and Business is 5,500 - 6000. Last year it was 4500. That seems to me proof that we need more competition on this route. I purchased TG business class flatbed to AKL for 3100 December - January. MH is 4100 direct KUL-AKL. Yet NZ is demanding prices for this single sector that other airlines are offering return to Europe for earlybird fares. Seems steep. The cheapest and only business class ticket NZ offered KUL-AKL on some days was on SQ via SIN, CBR, WLG :( and it was still well above 5000 and not a flat bed. Not competitive. Let's hope EK think about inserting a stop at Singapore for their second frequency. NZ and SQ have this thing well and truely stitched up at the moment and timings are not optimal for connections.
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planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 10:12 am

NZ321 wrote:
That seems to me proof that we need more competition on this route.

Absolutely.

As I showed back in post 49, AKL - SIN is regularly the most expensive non-stop flight to Asia from New Zealand (along with AKL - ICN).

There are a couple of factors at play here, including:

- Many ASEAN airlines, like GA and VN do not fly to New Zealand, and SIN is a key transit hub for customers from their home markets - this means that AKL - SIN customers have to compete with AKL - SIN - Indonesia / Vietnam customers for seats on the AKL - SIN services, reducing overall available capacity.

- When NZ tied up with SQ several years ago, most of NZ's Europe-bound passengers moved from being filtered through a number of ports like HKG, NRT, PVG, SFO and YVR, to being more filtered through SIN - again, this reduced the amount of seats available for SIN-bound customers on AKL - SIN flights.

It would be great if EK, JQ, QF or TZ launched AKL - SIN, to stir things up - though, I cannot see SQ seeing a need to place TZ here.

Cheers,

C.
 
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ernestxwb
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 10:48 am

planemanofnz wrote:
While D7 is said to be considering ADL, CBR and CNS, it has not expressed an intention to de-tag AKL, or to serve CHC or WLG.

See: https://blueswandaily.com/airasia-x-con ... nd-cairns/.

I wonder how D7 is doing at AKL - does anyone know?

Cheers,

C.


From what I have experienced as well as heard from others who have flown on D7206/207, the AKL to OOL leg is quite full. About half the passengers get off at OOL and half carry on to KUL and beyond. However their OOL to KUL leg isn't as full as AKL to OOL.
 
planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 11:05 am

ernestxwb wrote:
From what I have experienced as well as heard from others who have flown on D7206/207, the AKL to OOL leg is quite full. About half the passengers get off at OOL and half carry on to KUL and beyond. However their OOL to KUL leg isn't as full as AKL to OOL.

According to Australian government data, in 2016:

- OOL / KUL averaged (both ways) 77.7% load factor
- OOL / AKL averaged (both ways) 72.6% load factor

See: https://bitre.gov.au/publications/ongoi ... CY2016.pdf.

There are issues with this data, including the extent of overlap between OOL / KUL and OOL / AKL load factors, with transit passengers - nevertheless, the indication is that D7's flights are not doing fantastically (though, D7's load factors do beat some competitors out of AKL, like PR).

Cheers,

C.
 
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aerorobnz
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 12:04 pm

NZ321 wrote:
I have just checked available NZ fare Premium Economy and Business SIN-AKL for February and March. Premium economy is 3,300 and Business is 5,500 - 6000. Last year it was 4500. That seems to me proof that we need more competition on this route. I purchased TG business class flatbed to AKL for 3100 December - January. MH is 4100 direct KUL-AKL. Yet NZ is demanding prices for this single sector that other airlines are offering return to Europe for earlybird fares. Seems steep. The cheapest and only business class ticket NZ offered KUL-AKL on some days was on SQ via SIN, CBR, WLG :( and it was still well above 5000 and not a flat bed. Not competitive. Let's hope EK think about inserting a stop at Singapore for their second frequency. NZ and SQ have this thing well and truely stitched up at the moment and timings are not optimal for connections.


What it shows is actually that both TG and MH are not as easily full as NZ/SQ up the front, so they have to drop their fares to be able to fill it. If you had those fares to SIN then you'd probably need three times as many J class seats available to quell the demand and a much lower yield, and they would probably struggle to fill the equivalent Y seats if they flew 3x as much, What it actually shows is the very logical conclusion that SIN generates more local demand for J than KUL/BKK as a market before the higher transit demand from Europe and the latter end of the Asian peak fills the remainder. SIN has long been a market you will find very hard to get your upgrade confirmed on. Higher demand naturally means higher prices, and this was the case long before SQ/NZ came up with the current arrangement and even when they were not on speaking terms. What it probably anecdotally suggests is that SIN needs more C/U capacity to sell and that the 787 is not enough aircraft with the light config during high season. You are travelling right in the middle of the UK/Europe-NZ highest peak. After that peak, the transit demand drops away a bit, but the local SIN demand is year round, which is logical being such a business centre for Asia/Pacific head offices etc
I am pricing Sep/Oct/Nov when the transit demand is lighter and I'm getting 3800 on SQ codeshared NZ operated services both ways. and in April 3900 on NZ metal and flight numbers. You find that SIN-AKL-SIN business class fares are significantly higher year-round, naturally, the local market is SQ loyalists.
Flown to 147 Airports in 62 Countries on 83 Operators and counting. Wanderlust is like Syphilis, once you have the itch it's too late for treatment.
 
NZ321
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 12:14 pm

aerorobnz wrote:
NZ321 wrote:
I have just checked available NZ fare Premium Economy and Business SIN-AKL for February and March. Premium economy is 3,300 and Business is 5,500 - 6000. Last year it was 4500. That seems to me proof that we need more competition on this route. I purchased TG business class flatbed to AKL for 3100 December - January. MH is 4100 direct KUL-AKL. Yet NZ is demanding prices for this single sector that other airlines are offering return to Europe for earlybird fares. Seems steep. The cheapest and only business class ticket NZ offered KUL-AKL on some days was on SQ via SIN, CBR, WLG :( and it was still well above 5000 and not a flat bed. Not competitive. Let's hope EK think about inserting a stop at Singapore for their second frequency. NZ and SQ have this thing well and truely stitched up at the moment and timings are not optimal for connections.


What it shows is actually that both TG and MH are not as easily full as NZ/SQ up the front, so they have to drop their fares to be able to fill it. If you had those fares to SIN then you'd probably need three times as many J class seats available to quell the demand and a much lower yield, and they would probably struggle to fill the equivalent Y seats if they flew 3x as much, What it actually shows is the very logical conclusion that SIN generates more local demand for J than KUL/BKK as a market before the higher transit demand from Europe and the latter end of the Asian peak fills the remainder. SIN has long been a market you will find very hard to get your upgrade confirmed on. Higher demand naturally means higher prices, and this was the case long before SQ/NZ came up with the current arrangement and even when they were not on speaking terms. What it probably anecdotally suggests is that SIN needs more C/U capacity to sell and that the 787 is not enough aircraft with the light config during high season. You are travelling right in the middle of the UK/Europe-NZ highest peak. After that peak, the transit demand drops away a bit, but the local SIN demand is year round, which is logical being such a business centre for Asia/Pacific head offices etc
I am pricing Sep/Oct/Nov when the transit demand is lighter and I'm getting 3800 on SQ codeshared NZ operated services both ways. and in April 3900 on NZ metal and flight numbers. You find that SIN-AKL-SIN business class fares are significantly higher year-round, naturally, the local market is SQ loyalists.


Local demand? Hardly. SQ relies on transfer traffic via SIN as does SQ. I have had many an upgrade on SQ and NZ between AKL-SIN and v/v. Agree with you about the peak though. But March..... I've taken many an NZ special in March before. If as you say the demand is so high, why not more frequency? Not convincing IMHO. It's time for more competition.
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aerorobnz
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 2:17 pm

If as you say the demand is so high, why not more frequency? Not convincing IMHO. It's time for more competition.[/quote]
Because the demand is for J class, that's what we are talking about here, it isn't necessarily about overall aircraft demand. Y class, U class and J class all work differently, have slightly different peaks and troughs. Yield management/Yield dilution is something SQ/NZ as airlines appear very hot on.There is a fine line to walk between matching capacity with demand and diluting your overall yield. IF any route has a demand 130% of daily demand (ie 2.3 flights a day in SIN's case) then it is not enough to sustain an extra flight/new airline but it does warrant finding more seats, if it's around 105-110% then it can be managed with higher fares to lower the demand to meet capacity. This is also how seasonal capacity is calculated if during Nov-Mar the demand becomes more like 240-260% then they will do what SQ/KE/CZ does and increase to an A380/748 to cope, if it's higher still then they will increase frequency (CX, CZ, HX, UA, AA) The sweet spot for airlines is always to err on the side of caution and offering too little capacity rather than too much.

In NZ's case it is probably one, or a combination of
1) They can't justify the cost of another 787 flight to soak up the leftover J demand which is probably less than another full 15 seats a day anyway, especially if it isn't backed up with more Y class demand as well
2) they actually don't have available aircraft to be able to utilise even if they want to
3) The 77W capacity is probably too much aircraft for the route and both 777 types are also both highly utilised and better utilised to the USA. The 78N config they will use to IAH s probably ideal, but they don't have enough of in the fleet. I think once the next generation of long-haul is ordered we may well see the 78N config for IAH replaced with A359 or similar and likewise for other 787 routes like TYO, and then reutilised on routes like SIN to increase capacity/frequency.

The fact that in the 40 odd years of AKL-SIN, nobody has even given it a go, except JQ (who quickly changed their minds) despite a number doing the sums indicates that capacity/demand for the market is well balanced enough that a third airline is just competing for the scraps. More competition here may not necessarily change anything long term, as it has to be sustainable for the new entrant to stay and flourish. Singapore is one of the few long-haul markets that qualify for multiple daily non-stop services year-round to AKL, LAX, HKG, PVG being the others.

In general, this is the problem with the NZ market, It is big enough to justify service by an airline (generally NZ or whoever hubs at the other end) and possibly even 2 or 3 airlines, it is big and affluent enough that many people travel and airlines do the sums for operation, and they may even roll the dice with marginal figures expecting to be able to grow it a little, but they struggle with the sums for anything more than seasonal as the inbound market is so hugely seasonal, and the outbound market isn't large enough. The overheads and operational restrictions here are also considerable given the marginal nature of the yields and that keeps airlines away, Airlines like AA/UA are interested and are building the brands up as much as possible, but they cannot do anything year round with the demand that drops so much, especially as airlines are weighing the cost/profit of operation up against other markets they could potentially operate the same aircraft to.
Flown to 147 Airports in 62 Countries on 83 Operators and counting. Wanderlust is like Syphilis, once you have the itch it's too late for treatment.
 
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ernestxwb
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Re: New Zealand Aviation Thread - November 2017

Thu Nov 16, 2017 7:50 pm

planemanofnz wrote:
ernestxwb wrote:
From what I have experienced as well as heard from others who have flown on D7206/207, the AKL to OOL leg is quite full. About half the passengers get off at OOL and half carry on to KUL and beyond. However their OOL to KUL leg isn't as full as AKL to OOL.

According to Australian government data, in 2016:

- OOL / KUL averaged (both ways) 77.7% load factor
- OOL / AKL averaged (both ways) 72.6% load factor

See: https://bitre.gov.au/publications/ongoi ... CY2016.pdf.

There are issues with this data, including the extent of overlap between OOL / KUL and OOL / AKL load factors, with transit passengers - nevertheless, the indication is that D7's flights are not doing fantastically (though, D7's load factors do beat some competitors out of AKL, like PR).

Cheers,

C.

It will be interesting to see the loadfactors of 2017 after the route has matured a bit more.
 
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77west
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Re: New Zealand Aviation Thread - November 2017

Fri Nov 17, 2017 2:32 am

Anyone here know who to call RE KoruNet, the NZ employee system?

One of our staff has a cellphone that constantly gets txts that are clearly internal - such as today referring to an exercise (presumably) about an A320 runway excursion at Queenstown. As well as many other internal-nature txts. It was a new Vodafone number provisioned 6 months ago, and has 747 in it, which seems appropriate for a NZ staff member.
77West - AW109S - BE90 - JS31 - B1900 - Q300 - ATR72 - DC9-30 - MD80 - B733 - A320 - B738 - A300-B4 - B773 - B77W
 
planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Fri Nov 17, 2017 9:09 am

aerorobnz wrote:
The fact that in the 40 odd years of AKL-SIN, nobody has even given it a go, except JQ (who quickly changed their minds) despite a number doing the sums indicates that capacity/demand for the market is well balanced enough that a third airline is just competing for the scraps.

One of the main reasons for the Commerce Commission approving the CX - NZ JV, was the belief that a third carrier would never launch AKL - HKG, and that for CX and NZ to maintain their existing frequencies, co-ordination was needed. Then came HX, who not only launched AKL - HKG against a 3x daily service by the CX - NZ JV, but increased its service to double-daily shortly thereafter (and is maintaining this despite more aggressive competition, like CHC - HKG being launched by CX) - the market is always evolving.

Regarding JQ, I do not see its withdrawal from AKL - SIN as a strong indication that the route cannot support another carrier. For starters, the economics of a JQ service would be different today - its 787s are more economical than A330s, and Auckland's wealth has increased dramatically since JQ withdrew (double-digit house price increases, for example). Another point is that, perhaps given the more business-focused nature of the route, it would be more suited to a full-service carrier, or one that offers more connections.

Cheers,

C.
 
ZK-NBT
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Re: New Zealand Aviation Thread - November 2017

Fri Nov 17, 2017 10:25 am

planemanofnz wrote:
aerorobnz wrote:
The fact that in the 40 odd years of AKL-SIN, nobody has even given it a go, except JQ (who quickly changed their minds) despite a number doing the sums indicates that capacity/demand for the market is well balanced enough that a third airline is just competing for the scraps.

One of the main reasons for the Commerce Commission approving the CX - NZ JV, was the belief that a third carrier would never launch AKL - HKG, and that for CX and NZ to maintain their existing frequencies, co-ordination was needed. Then came HX, who not only launched AKL - HKG against a 3x daily service by the CX - NZ JV, but increased its service to double-daily shortly thereafter (and is maintaining this despite more aggressive competition, like CHC - HKG being launched by CX) - the market is always evolving.

Regarding JQ, I do not see its withdrawal from AKL - SIN as a strong indication that the route cannot support another carrier. For starters, the economics of a JQ service would be different today - its 787s are more economical than A330s, and Auckland's wealth has increased dramatically since JQ withdrew (double-digit house price increases, for example). Another point is that, perhaps given the more business-focused nature of the route, it would be more suited to a full-service carrier, or one that offers more connections.

Cheers,

C.


I’ve not seen anything to suggest HX maintaining double daily. Only for Dec-Feb.
 
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aerorobnz
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Re: New Zealand Aviation Thread - November 2017

Fri Nov 17, 2017 11:48 pm

ZK-NBT wrote:

I’ve not seen anything to suggest HX maintaining double daily. Only for Dec-Feb.

Yeah, it's a high season increase. like the morning CX flight.
Flown to 147 Airports in 62 Countries on 83 Operators and counting. Wanderlust is like Syphilis, once you have the itch it's too late for treatment.
 
nz2
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 12:44 am

Sorry if this has been discussed previously, but I was in NSN this week and saw 3 Virgin ATR's sitting there with all windows covered up. All 3 had a door open and a couple of guys in hi-viz standing around but not much activity. What is the go here?
 
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mariner
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 12:47 am

I wonder why LATAM is being so slack about border procedures:

http://www.newshub.co.nz/home/new-zeala ... aland.html

"Airline fined for letting Syrian fly to New Zealand

An airline has been prosecuted for allowing a Syrian man to board a flight to New Zealand - despite being told by Immigration New Zealand (INZ) not to do so.

The passenger was a Syrian who attempted to fly to New Zealand from Chile in 2015. An airline needs to enter a passenger's information into INZ's system, which tells them if the passenger is allowed to board. This prevents any people with security issues from travelling to New Zealand.

LATAM Airlines was convicted and fined a total of $11,700 plus court costs at the Manukau District Court on Thursday.

LATAM Airlines was also issued with 590 infringement notices between July 2012 and May 2017 for breaching the Immigration Act, including seven in relation to failing to comply with a do not board directive."


That's a lot of infringements.

mariner
aeternum nauta
 
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mariner
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 1:32 am

VirginFlyer wrote:
Looking back to the past, Sea Bee Air used to fly Mechanics Bay to Waiheke, Great Barrier, Kawau and Paihia back in the day - see http://3rdlevelnz.blogspot.co.nz/2011/1 ... d.html?m=1


In Sydney, they used to fly out of Rose Bay - and are doing so again:

http://www.traveller.com.au/flying-boat ... way-gykuyn

"Sydney Seaplanes: Scenic flights over Sydney - the flying boat is back"

https://www.youtube.com/watch?time_cont ... BD5lraRvdA

I think its quite a smart idea because the terminal - at Rose Bay - has been made into somewhere interesting, I'd go there for lunch and to look at the aircraft. They have two seaplanes - the Cessna Caravan Amphibian (12 pax) and the DHC-2 Beaver (7 pax).

I think there's probably a quid in it and it's possible - perhaps - that a similar operation could work here, at least in the summer season, with flights to the Gulf islands and to the Bay of Islands with the base at Auckland Harbour. I believe Mechanics Bay has gone (?) but there have to be other suitable places.

mariner
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planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 1:33 am

ZK-NBT wrote:
Only for Dec-Feb.

That is my point - HX announced a double-daily service (albeit seasonally), and maintained its planned increase in frequencies despite further competition, like CX launching CHC - HKG (again, albeit seasonally).

Cheers,

C.
Last edited by planemanofnz on Sat Nov 18, 2017 1:34 am, edited 1 time in total.
 
ZK-NBT
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 2:33 am

planemanofnz wrote:
ZK-NBT wrote:
Only for Dec-Feb.

That is my point - HX announced a double-daily service (albeit seasonally), and maintained its planned increase in frequencies despite further competition, like CX launching CHC - HKG (again, albeit seasonally).

Cheers,

C.


That’s not how I read your original post. The only extra capacity is the CX seasonal CHC flight which runs DEC-FEB which is the same period of the second AKL flight every year which is a 77W. I’m surprised NZ don’t increase HKG-AKL, probably slots, to connect to EZE.
 
DavidByrne
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 2:44 am

nz2 wrote:
Sorry if this has been discussed previously, but I was in NSN this week and saw 3 Virgin ATR's sitting there with all windows covered up. All 3 had a door open and a couple of guys in hi-viz standing around but not much activity. What is the go here?

VA signed a five-year maintenance agreement with Air NZ in March this year whereby their 14 ATRs would be sent to Nelson for heavy maintenance. However, within a couple of months they had significantly downsized their ATR plans, deciding to reduce the fleet to just six IIRC. Theoretically there are now eight ATRs surplus to requirements, and I assume that the three at NSN (I saw them myself in October and again early this month when flying in and out of NSN) are now awaiting their next owner. They certainly don't seem to be being sent back to Australia to be reincorporated in the fleet.

I wonder where this leaves the five-year contract between VA and NZ. Presumably VA gave themselves an "out" clause, but I wonder how much NZ was in the know about the real possibility that the contract might be truncated. Their trumpeting of the contract back in March didn't give any clue that it might not be the money-spinner they'd thought.

http://www.stuff.co.nz/nelson-mail/news ... -in-Nelson
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planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 3:16 am

Here are some more photos from Samoa Airways' AKL launch, and Thai Airways' AKL frequency upgrade:

Image

Image

Image

Image

See: https://www.facebook.com/pg/AucklandAir ... e_internal.

It looks like AKL puts on a good show for events such as these, which is nice to see.

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

This week, AKL ran a behind the scenes tour of just-completed projects and work still in progress - here are some photos:

Image

Image

See: http://www.nzherald.co.nz/business/news ... d=11944989.

The refurbishment looks great - I am particularly looking forward to seeing the new departure area, which will have twice the area of the existing one.

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

TRG is also seeing refurbishment works:

"the terminal is more than doubling in size – from 1,700m2 to 3,8000m2. The cafe will double in size, with an international airport look and feel about it. The upstairs Koru Lounge will quadruple in size."

See: http://www.theweekendsun.co.nz/news/303 ... rport.html.

Given the funding issues at regional airports, it is great to see that TRG will not need ratepayer support:

"We have a huge cash reserve and the projected commercial revenues will do the rest.

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

UL is seeking to code-share on QF's services to New Zealand.

See: https://blueswandaily.com/qantas-applie ... w-zealand/.

I wonder if UL will invest more in New Zealand, like by attending travel expos (like EY and other purely code-share airlines do).

ZK-NBT wrote:
That’s not how I read your original post.

The point is simple - if AKL - HKG can sustain 3 carriers, then AKL - SIN should be able to, too.
 
qantas747
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 3:32 am

Interesting information about AKL

There is a good investor day presentation that shows some interesting renders and more detailed product updates https://corporate.aucklandairport.co.nz/~/media/Files/Corporate/Investors/Investor-day-2017.ashx?la=en 107 pages of fun!
 
planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 3:43 am

qantas747 wrote:
Interesting information about AKL

There is a good investor day presentation that shows some interesting renders and more detailed product updates https://corporate.aucklandairport.co.nz/~/media/Files/Corporate/Investors/Investor-day-2017.ashx?la=en 107 pages of fun!

I note on page 91 that the new Pullman Hotel at AKL will have a rooftop bar! :hyper:

I wonder how good the views will be up there for plane spotting.

Cheers,

C.
 
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 3:58 am

Planemanofnz while I get your point the way I read your post was that HX were increasing year round which they aren’t, ‘yet’. I’m not sure HX make any money however, so they make money fullstop? EK are really about the only option for AKL-SIN imo, I’m not sure TZ will come here and it won’t be JQ again. Sure we all want to see more routes but we need to be realistic.
 
NZ321
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 7:22 am

I am keeping my fingers crossed for EK. It gives another option and would put pressure on prices.
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sq256
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 7:50 am

NZ321 wrote:
Re KUL-NZ. Understand your point now.

Agreed would be nice to see DL at AKL. Either from LAX or SEA. Don't rate the chances of SLC. Actually, I don't rate chances of DL coming to AKL at all really. They don't seem serious about the Pacific in the way UAL are and AA appear to be. Their capacity seems to have dropped since NW days. The de-hubbing of NRT probably contributes. They exited BKK. Reduced Singapore. Didn't resume KUL. Their focus is mainly China, Korea, Japan. And they seem to be routing more flights out of SEA rather than nonstop from ATL and DTW with significant adjustments for seasonal frequency such that some routes are minimal in the off season. They haven't expanded frequency to Australia after how many years? All in all, a conservative approach to trans-Pac and Down Under.


KUL and BKK are since too low yielding for DL (primarily cheap tourist/VFR traffic), whereas KE and other asian partners could cover those cities via their hubs in their respective cities.

IMO, DL at AKL would only be likely if the declining NZ/VA relationship goes further south to an extent that VA/NZ doesn't renew their Tran-tasman JV (effectively becoming competitors). DL/VA however would need to apply for NZ government approval if they want to extend their TransPacific JV onto NZ routes.
 
planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 11:44 am

qantas747 wrote:
There is a good investor day presentation that shows some interesting renders and more detailed product updates https://corporate.aucklandairport.co.nz/~/media/Files/Corporate/Investors/Investor-day-2017.ashx?la=en 107 pages of fun!

Southeast Asian flights are interesting to analyse:

- Chinese passengers connecting through Southeast Asia to AKL have dropped from 23% to 5% of the market (2015 - 2017) (page 25)
- European passengers connecting through Southeast Asia to AKL have dropped from 33% to 22% of the market (2015 - 2017) (page 27)
- Indian passengers connecting through Southeast Asia to AKL have dropped from 68% to 59% of the market (2015 - 2017) (page 29)

Despite this, Southeast Asian carriers seem to be doing fine here - MH did not pull out in its re-structure, and TG is upgrading to a daily flight.

Some other interesting points from this document:

- Chinese arrivals have undershot forecasts (page 11)
- New Zealand as a market remains under-served (pages 18 and 20), with South Korea being the most under-served market out of AKL (page 24)
- A key strategy is growing off-season tourism (page 32)

IMHO, NZ should seriously consider ICN, in partnership with OZ - the growth is clearly there, and KE shows no signs of down-grading to a 787.

ZK-NBT wrote:
EK are really about the only option

ZK-NBT wrote:
I’m not sure TZ will come here

ZK-NBT wrote:
we need to be realistic

I note that:

- AKL has 2x daily flights to SIN (1x on NZ, 1x on SQ)
- BNE has 7x daily flights to SIN (1x on EK, 1x on QF, 4x on SQ, 1x on TZ)
- PER has 10x daily flights to SIN (2x on 3K, 1x on JQ, 2x on QF, 4x on SQ, 1x on TZ)

Yes, AKL smaller than BNE or PER, but the overall catchment areas are comparable. Yes, AKL receives an A380 for one of its flights, which equates to multiple narrow-bodies, but this is only a seasonal up-gauge. Yes, BNE and PER have greater Singaporean expat populations than AKL, but AKL has less competition (with no GA, OD or other services). Ultimately, AKL - SIN should be able to sustain more services, given the comparisons (BNE / PER - SIN, and AKL - HKG).

On carriers, EK is not the only option here - AI, LA, QR, TK and others could also use fifth-freedom rights on any AKL - SIN service. I would also add that, with the amount of 787s in the SQ Group's order books, it is reasonable to suggest that TZ will consider AKL in the future (or another New Zealand destination).

Cheers,

C.
 
NZ321
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 11:53 am

I'm all for an NZ flight to ICN. With a likely flight time of about 12 hours northbound and 11 hours 15 southbound I presume NZ's Asian configured 789s could manage it without a payload hit. Perhaps 3 x weekly to start? Moving to 5x weekly or daily for the peak season.
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planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 12:01 pm

NZ321 wrote:
I presume NZ's Asian configured 789s could manage it without a payload hit.

Absolutely - AKL - ICN (5,984 mi) is only marginally longer than AKL - PVG (5,808 mi).

Cheers,

C.
 
aotearoa
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Re: New Zealand Aviation Thread - November 2017

Sat Nov 18, 2017 8:49 pm

77west wrote:
Anyone here know who to call RE KoruNet, the NZ employee system?

One of our staff has a cellphone that constantly gets txts that are clearly internal - such as today referring to an exercise (presumably) about an A320 runway excursion at Queenstown. As well as many other internal-nature txts. It was a new Vodafone number provisioned 6 months ago, and has 747 in it, which seems appropriate for a NZ staff member.


PM me with the number and I’ll get it sorted for you.
 
aerokiwi
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Re: New Zealand Aviation Thread - November 2017

Sun Nov 19, 2017 1:13 am

planemanofnz wrote:
If you look at NZ's '2017 Annual Results Analyst Presentation,' you can see:

- Page 6: Americas "Exceeded expectations" (whereas for Asia, there was "Continued competitive pressure")
- Page 11: "Yield pressure driven by" ... "Competition from new carriers in U.S."
- Page 19: For North America, "Strong, underlying demand continues"

See: https://p-airnz.com/cms/assets/PDFs/air ... tation.pdf.

Then, if you look at NZ's '2017 Financial Results,' you can also see:

- Page 9: Overall revenue from "America" declined from $831M (2016) to $729M (2017)
- Page 47: Passengers carried on "America and Europe" services increased from 1,138,000 (2016) to 1,198,000 (2017)

See: https://p-airnz.com/cms/assets/PDFs/air ... esults.pdf.

All in all, it looks like NZ's North American flights are doing well, despite increased competition.

Cheers,

C.


A decline in revenues of over $100 million is "doing well"? Have I misread this? It sounds pretty atrocious really. NZ has to do a lot more for less revenue. Usually not a good sign at all.
 
planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Sun Nov 19, 2017 2:12 am

aerokiwi wrote:
A decline in revenues of over $100 million is "doing well"? Have I misread this? It sounds pretty atrocious really. NZ has to do a lot more for less revenue. Usually not a good sign at all.

In the context of new non-stop competition for the first time in a number of years, IMHO, yes, that is a solid result - NZ said that the Americas had "Exceeded expectations." Also remember that indirect competition has significantly increased too (like CA, HA and PR all marketing AKL - Americas connecting services).

There are other factors to note here, too:

- Profit (not revenue) is the end-game - costs might have come down a lot (fuel costs, and the costs of operating the 787s)
- Currency fluctuations might have some impact too (for example, the NZD hit a 2 year high against the USD earlier this year)

Cheers,

C.
 
ZK-NBT
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Re: New Zealand Aviation Thread - November 2017

Sun Nov 19, 2017 2:49 am

NZ321 wrote:
I'm all for an NZ flight to ICN. With a likely flight time of about 12 hours northbound and 11 hours 15 southbound I presume NZ's Asian configured 789s could manage it without a payload hit. Perhaps 3 x weekly to start? Moving to 5x weekly or daily for the peak season.


Really it’s a seasonal market like so many other markets to NZ, KE run a 4-5 weekly 77W in winter up from a 77E in previous years and up gauge to a 748 for 3 months, was meant to be longer but didn’t happen, they did go daily for November 77W this year, usually stays 5 weekly.

If and that’s a big if NZ went there I’d imagine a summer seasonal 3 weekly, the fleet is pretty stretched as it is over summer. OZ would seem more likely with a seasonal service to me.

In the early 2000’s KE maintained a daily 744 for a couple of years increasing to double daily in JAN-FEB. OZ came for less than 18 months before pulling out and KE did DEC-FEB CHC services with 744’s/77E’s for 3 years. Personally I am a bit surprised they haven’t been back to CHC. They will again run an additional AKL 77W for 6-7 weeks this year as well, OZ meant to do CHC last year for 6 flights but didn’t. Markets always change but there must be a reason there isn’t more capacity, demand must not be there.
 
aerokiwi
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Re: New Zealand Aviation Thread - November 2017

Sun Nov 19, 2017 3:13 am

planemanofnz wrote:
In the context of new non-stop competition for the first time in a number of years, IMHO, yes, that is a solid result - NZ said that the Americas had "Exceeded expectations." Also remember that indirect competition has significantly increased too (like CA, HA and PR all marketing AKL - Americas connecting services).

There are other factors to note here, too:

- Profit (not revenue) is the end-game - costs might have come down a lot (fuel costs, and the costs of operating the 787s)
- Currency fluctuations might have some impact too (for example, the NZD hit a 2 year high against the USD earlier this year)

Cheers,

C.


I disagree. Their expectations might have been for worse but instead they just got bad.

Combined with the comments on yield pressure, a 13 per cent decline in revenues is anything like good news. Cost savings in a single year are unlikely to cover that and given revenue is the underlying indicator of future performance, I'd hardly classify this as going well. Currency changes are just part and parcel. Yeah it may have gone against them... but so? Doesn't negate the fact that there was a substantial revenue decline.

But we're likely to see some consolidation over the next few years on that market. No doubt that'll contribute to an improvement for NZ.
 
planemanofnz
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Re: New Zealand Aviation Thread - November 2017

Sun Nov 19, 2017 4:46 am

aerokiwi wrote:
I disagree. Their expectations might have been for worse but instead they just got bad.

Combined with the comments on yield pressure, a 13 per cent decline in revenues is anything like good news. Cost savings in a single year are unlikely to cover that and given revenue is the underlying indicator of future performance, I'd hardly classify this as going well. Currency changes are just part and parcel. Yeah it may have gone against them... but so? Doesn't negate the fact that there was a substantial revenue decline.

But we're likely to see some consolidation over the next few years on that market. No doubt that'll contribute to an improvement for NZ.

Those revenue figures only tell half of the story - they are broken down by origin of sale. So, while revenue from sales in America, Asia and Europe all declined, revenue from sales in Australia, New Zealand and the Pacific Islands increased. Therefore, although NZ received less money from Americans purchasing tickets for its services, it received more money from Australians and New Zealanders doing so (with a lot of this likely to be for North American services). It is also notable that on NZ's American services, passengers carried and average load factors both increased, while on its Asian services, average load factors decreased. It is likely for this reason that NZ explicitly contrasted its take on the two markets, with the former having "exceeded expectations," while the latter suffered from "continued competitive pressure."

NZ is a listed company with strict disclosure obligations - if it says that its North American operations are performing well, then I take that to be the truth.

Finally, on your other comments on measuring route performance:

1. Revenue as a key indicator of future performance

If this is to be the case, then you have to look at revenue over mid-term (rather than a single year):

- 2014 AFR: $573M to $638M
- 2015 AFR: $638M to $702M
- 2016 AFR: $702M to $831M
- 2017 AFR: $831M to $729M - the only year of decline

Overall, the trend is clearly positive - NZ's America revenue is still above 2015 / 2016 FY levels.

With AA moving to a reduced seasonal service only, NZ's numbers here are likely to improve further.

2. Currency fluctuations are just 'part and parcel'

See page 29 in NZ's financial results - currency is a key risk for NZ's financial performance, and is a risk largely outside of NZ's control. If the NZD increased by 13% against the USD, NZ's America revenue is 13% less valuable in its results (which are reported in NZD) - this appears as a major negative in NZ's financial statements, but the decline in revenue does not necessarily mean that NZ's load factors and passenger numbers are declining on its American services.

Cheers,

C.
 
aerokiwi
Posts: 2649
Joined: Sun Jul 30, 2000 1:17 pm

Re: New Zealand Aviation Thread - November 2017

Sun Nov 19, 2017 6:28 am

The best proxy for American revenue is the sales from that market - I'm assuming there is no immediate breakdown of actual geographic market performance, though I'll dig around more later to see. So your assertion that the sales to Australians and Kiwis are for North American services is guesswork for now. Happy to be shown otherwise with actual evidence. Australian visitors to New Zealand surged this year so that likely sucks up a chunk of that new revenue.

And the revenue increase from those sales does not make up for the decline in NA revenue - $62m up vs $102m down.

And actually NZ suffered substantial declines in revenues from Asian and European markets. Interesting.

And I wouldn't rely on supermarket disclosure requirements to give confidence that you're getting the whole story. Airlines are notorious for coughing negative results in bollacky language and getting away with it.

Yes I understand currency impacts. But that doesn't negate the decline in revenues. For whatever reason - currency, competition - it's substantial and any company would be concerned by that, especially if it's your own currency that's on the upside.
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