ATR Order Provides Growth Options for AirNZ

Air New Zealand this week ordered seven ‘new-generation’ ATR 72-600 turboprops with purchase options for a further five in a deal that will support a renewed focus on developing air service connections to regional New Zealand. The tentative contract, which remains subject to a formal signing, potentially doubles the size of Air New Zealand’s ATR fleet and will put a further two million seats into the New Zealand regional market annually. And for travellers this will mean a large increase in the number of business and leisure seats available on regional routes, according to the carrier.

The first of the 68-seat ATR72-600 aircraft will be delivered to Air New Zealand in October 2012 followed by a second in December that year, two in 2013 and another each year for three years. The five purchase options are available for delivery between 2014 and 2016. This follows Air New Zealand’s investment in 23 Bombardier Dash 8-Q300 aircraft over the past six years and the purchase from lease of the majority of the existing ATR 72-500 fleet over the past eighteen months.

“At a time when other businesses have shown little appetite to invest significantly in assets, particularly where revenue is derived from regional New Zealand, we have not waivered in our belief in the long-term strength of the domestic economy,” said Rob Fyfe, Chief Executive Officer, Air New Zealand. “Thanks to the purchase of larger aircraft and the lowering of fares we have seen regional passenger numbers increase by an average 5.6 per cent annually since 2003, resulting in our regional airlines carrying 54 per cent more passengers to 4.3 million in the year ended September.

The new-generation ATR 72-600 features a new cabin layout with larger overhead bins, improved seating and advanced cockpit technology including Required Navigation Performance (RNP) technology. The latter will further enhance Air New Zealand’s ability to maintain services during inclement weather to and from destinations like Queenstown, Rotorua and Wellington.

“The current ATR 72-500 – which sits alongside our Q300s and Beech 1900Ds - has been a core part of our regional operations since 1999 and has been a popular aircraft type with customers, serving 14 different domestic routes,” said Bruce Parton, Group General Manager Australasia, Air New Zealand. “The new ATR 72-600 aircraft will give us the means to up-gauge Q300 operated routes that will require more capacity in the coming years. In turn, this will release Q300 aircraft to up-gauge on some Beech 1900D operated routes, enabling us to look at start-up routes. So there is benefit in bringing in the larger turboprops and cascading growth down throughout our regional operation.”

It is likely that the new fleet will be Auckland-based and some routes currently serviced by the smaller Q300s, such as Nelson - Auckland and New Plymouth - Auckland, have already been earmarked for upgrade to the larger turboprop.