I find lunch time Sunday to be the cheapest flight NSN - WLG.

allan:

 

frankv:

 

scuwp:

 

Government interference forcing uneconomic routes will quickly see the airline bankrupt.   I do feel sorry for the small towns left out but it is simply an economic reality.    

 

Ah yes, that worked well, right up to the point where the Government had to bail them out. 

 

That was more to do with the Ansett debacle i thought.

 

And the complete plonker that was their CEO at the time. I can't recall super clearly but I recall someone saying something at the time around the fact decisions he made the last 2 years almost warranted criminal charges!

MileHighKiwi: If there's demand and the economics work out a smaller regional carrier (e.g. Sounds Air) will fill the gap.

Agreed, however, if the demand is greater than their capacity, the investment in new aircraft might be a stretch capital expenditure wise. I guess it allows the possibility of AIRNZ to Sublease, or rent to own the craft it would have run these services on.

Are the routes uneconomical, or is it more a case of there being more economical routes available.  Talk around the grapevine is a lack of available staff to fly ATR's and hence pulling them from an average route in Kapiti (that probably does make money) to one that makes more money.

I feel that Air New Zealand does have an obligation to support regions to a certain point, they are majority owned and have been bailed out by the government.  I have no doubt the government will have been having a word with Air NZ when it comes time for the AGM, but SJ has decided to make it public to effect consideration earlier than that.

Shane Jones must have watched too many American prison movies.

He's watched too many porn movies, at taxpayers expense.

itxtme:

 

Are the routes uneconomical, or is it more a case of there being more economical routes available.

 

What difference does it make? If I have limited resources, surely one focuses on those which have the best return on investment? Boards responsibility.

itxtme:

 

Are the routes uneconomical, or is it more a case of there being more economical routes available.  Talk around the grapevine is a lack of available staff to fly ATR's and hence pulling them from an average route in Kapiti (that probably does make money) to one that makes more money.

 

I feel that Air New Zealand does have an obligation to support regions to a certain point, they are majority owned and have been bailed out by the government.  I have no doubt the government will have been having a word with Air NZ when it comes time for the AGM, but SJ has decided to make it public to effect consideration earlier than that.

 

 

 

The Government is one of many share holders. The boards responsibility is to all shareholders and to uphold the companies mandate. 

If one shareholder (even if it's a majority) wants to run the company in a measurably poor manner, it's board can face charges. Much like trustees in a trust. You can't just do anything you like. 

If one shareholder (even if it's a majority) wants to run the company in a measurably poor manner, it's board can face charges. Much like trustees in a trust. You can't just do anything you like.

Have you read the financials for the last 3 years? I would not say it has been running in a "measurably poor manner" with those routes open.  Also your claim about a shareholder causing the board to face charges is fantasy in this case.  I merely expressed my view that having regional routes open [ones that make money] as part of being the national carrier, may be a sensible thing to do, especially in a country that is trying to encourage regional growth, not stifle it.  On top of that I offered a reason why this last change in Kapiti may have happened.

Maybe you wish to comment on the effectiveness of the board that lead to a lack of staff available to fly ATR's [conjecture of course]?  This would fit with why the plane out of Kapati was pulled with only weeks notice..

itxtme:

 

If one shareholder (even if it's a majority) wants to run the company in a measurably poor manner, it's board can face charges. Much like trustees in a trust. You can't just do anything you like.

 

Have you read the financials for the last 3 years? I would not say it has been running in a "measurably poor manner" with those routes open.  Also your claim about a shareholder causing the board to face charges is fantasy in this case.  I merely expressed my view that having regional routes open [ones that make money] as part of being the national carrier, may be a sensible thing to do, especially in a country that is trying to encourage regional growth, not stifle it.  On top of that I offered a reason why this last change in Kapiti may have happened.

 

Maybe you wish to comment on the effectiveness of the board that lead to a lack of staff available to fly ATR's [conjecture of course]?  This would fit with why the plane out of Kapati was pulled with only weeks notice..

 

Financials look good. Would they look even better without loss-making routes? The board facing charges was an extreme example, but rest assured, it happens. Even in NZ (Feltex et al). 

As has been mentioned before, if the Government feels strongly that Air NZ should continue to operate these routes, it's entitled to raise it at the shareholder meeting, or even use it's large shareholder rights to call a special meeting and come to some agreement with it's $200M Dividend. 

Unlike Telecom who had a legal obligation to operate a copper network at specific performance as part of the sale from the Goverment, no such agreement (to my knowledge) exists to compel the board to continue to run routes which are not as profitable as other routes. Perhaps NZF could take some of the $500M Labour gave them from the healthcare fund, for the provinces and subsidize/incentivise Air NZ to keep operating, or better still, help a smaller company grow by supporting them in providing planes to these regions. 

I am not unsympathetic to the plight of those in the regions as it relates to these cuts, I am simply stating that there is no obligation moral or otherwise for AirNZ to operate in those regions if it's not profitable.

Perhaps the Government could appoint some one to make the regions more desirable places to fly too 

Some sort of Minister for Regional Economic Development

Then AirNZ etc will put on flights as the demand is there

All the discussion so far has touched on the financial side of it.

The thing that struck me when I heard the mayors of several smaller towns on the radio was that this issue causes terrible damage to the ANZ 'brand' (urgh).

They are no longer the airline for all of NZ - only the bits they cherry pick.

I bet this kind of thing lets ANZ slide down the trusted brand ladder a few rungs each time.

elpenguino:

 

All the discussion so far has touched on the financial side of it.

 

The thing that struck me when I heard the mayors of several smaller towns on the radio was that this issue causes terrible damage to the ANZ 'brand' (urgh).

 

They are no longer the airline for all of NZ - only the bits they cherry pick.

 

I bet this kind of thing lets ANZ slide down the trusted brand ladder a few rungs each time.

 

ooooh - good point.  I wonder how much of the CEO's package is based on the change in the trusted brand ladder?  Or the level of dividends?

Must be quaking in their boots on that one. 

How many employees will be willing to forgo their bonus ($1700 last year, $2500 the prior year) just to improve that brand ranking.  In fact I'd go one step further and ask how many would be willing to forgo that bonus just so smaller towns get a daily service that not enough people want to use?