Air NZ is seeking to tie up its regional network to avoid low-cost competitors muscling in on a significant revenue-generating part of its operation.
The national carrier has ordered seven new aircraft, with a repurchase offer of a further five at a total cost of $US270 million ($NZ340 million)The first of the new aircraft will arrive in New Zealand in October next year, followed by another a month later.
Two more aircraft will arrive in 2013 and one each in 2014, 2015 and 2016.
The five purchase-option planes are available for delivery between 2014 and 2016.
Air NZ chief executive Rob Fyfe told a media conference the new ATR72-600 was the most efficient aircraft in its class, featuring a new cabin layout and larger overhead bins, improved seating and advanced cockpit technology, including required navigation performance (RNP) technology.
The introduction of RNP would improve the airline's ability to maintain services during inclement weather to and from destinations such as Queenstown, Rotorua and Wellington.
Three or four years ago, Air NZ lost 40 days a year on its Queenstown routes because of the weather. That had been cut to about 10 days a year, thanks to new technology, he said.
Passenger growth on the regional network had been 5.6% a year since 2003, resulting in the regional airlines carrying 54% more passengers for a total of 4.3 million in the year ended September.
"Today's significant capital investment also signals that we will be upping our promotion of key regional centres at home and overseas, as we will need to encourage even more people to fill those two million more seats coming on stream over the next few years," Mr Fyfe said.
Air NZ group general manager Bruce Parton said it was likely the new fleet would be Auckland-based, providing a spread of regional aircraft including bases in Christchurch, Nelson and Hamilton.
"This will give us a solid platform for regional growth, particularly into and out of Auckland."
It was likely some routes serviced by the smaller Q300, such as Nelson-Auckland and New Plymouth-Auckland, would see the larger ATR72-600 in use.
The new aircraft would give Air NZ the ability to provide better flight frequencies on regional routes, different flight times and the opportunity for more Grab-a-Seat cheaper seats, things customers had been asking for, he said.
• In a separate announcement, Mr Fyfe said Air NZ would host the Boeing 787-8 Dreamliner test aircraft in Auckland from November 12-14. Air NZ was the launch customer for the larger 787-9 variant, which would have a greater range capability and seating capacity than the 787-8.
"Once the 787-9 goes into service some time in 2014, it will change how New Zealanders fly and how we bring the world to New Zealand," he said.
At a glance
• Up to 12 new ATR72-600 aircraft by 2016.
• Total cost $340m.
• More regional flights.
• Queenstown likely to benefit.
