The Government has unveiled a $30 million loan fund to prop up struggling regional airlines — and signalled it expects Air New Zealand to integrate smaller carriers into its systems so regional passengers can travel seamlessly onto mainline and even international flights.
Regional Development Minister Shane Jones said reliable air links were “critical for the economic and social wellbeing of regional New Zealand.” Associate Transport Minister James Meager added that “streamlining bookings and baggage-handling between the smaller carriers and the bigger players will make it much easier for the travelling public.”
The technology upgrade would mean passengers booking with small operators like Barrier Air could, in future, check baggage right through to their final destination, whether domestic or international. It could also allow them to earn frequent flyer points and gain airport lounge access if tied into Air New Zealand’s loyalty programme — benefits currently unavailable to regional travellers.
The move follows comments Meager made to AoteaGBI.news in August, when he said the Government was “actively considering options” to address regional connectivity and improve competition in aviation.
The concessionary loans, delivered through the Regional Infrastructure Fund, are designed to cover costs such as aircraft leasing, maintenance and debt refinancing. The scheme comes after a spate of retrenchment: Sounds Air has exited Wānaka, Taupō and Westport; Sunair has grounded its scheduled network; and Barrier Air has been forced to trim schedules, sell one aircraft and lease out another over winter.
Barrier Air chief executive Grant Bacon told AoteaGBI.news last month that a single part, a fuel control unit, had jumped from USD $20,000 to nearly $100,000. “Even short flights like those to Great Barrier are now difficult to operate unless planes are full in both directions,” he said. Load factors on busy days, he added, were often only around 50 percent.
Air Chathams welcomed the package as “long-awaited recognition of the essential role regional air services play in keeping New Zealand connected.” But Whakatāne Mayor Victor Luca said it fell short, arguing Air New Zealand’s $412m profit in 2023 meant the carrier should be compelled to support the regions more directly.
Barrier Air has repeatedly stressed that its flights are not leisure services but lifelines, carrying urgent patients, blood tests, medicines, doctors and food to Aotea.
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