Air New Zealand is offering some rock bottom fares in an effort to stimulate demand. This morning they’ve released a swag of NZD$9 (USD$5.50) domestic airfares, hoping to lure wary passengers back into the skies.
But numbers are limited. Air New Zealand is only releasing 1,000 of these fares. They will be on sale from 20:00 UTC this evening.
Promotion the result of softening demand
The New Zealand Herald is reporting the airline’s Chief revenue officer Cam Wallace saying the cut-price airfares are a result of softening demand.
Late last week, Air New Zealand halved its flights to Samoa. The small Pacific nation is not admitting incoming passengers unless they possess a fit to travel medical certificate.
China is New Zealand’s second-largest inbound tourist market. It isn’t only the passenger numbers that are important, it is their spending. Last week, Air New Zealand Chairman Dame Therese Walsh said;
“While the Covid-19 situation is dynamic, we have taken immediate steps to mitigate the impact of softer demand and I am confident that we have the ability to manage the expected short-term impacts effectively.”
There are also discounted fares across to Australia
Prospective passengers may also be interested in some bargain fares from New Zealand to Australia. Air New Zealand is selling one-way fares across to Sydney, Brisbane, or Melbourne for about USD$50. That’s insanely cheap and about a quarter the cost of one night’s accommodation in a decent hotel in either Sydney or Melbourne.
That has prompted competitors like Jetstar to jump in and offer equally competitive fares.
You might think airline traffic across the Tasman Sea would be relatively immune from the impact of coronavirus. Not so. Besides a general downturn in passenger numbers, Air New Zealand usually carries a lot of Chinese travelers on routes between New Zealand and Australia.
Now they have empty seats. The impact has been most strongly felt on leisure orientated routes out of the South Island airports of Christchurch and Queenstown. Working on the basis that some small revenue is better than no revenue, Air New Zealand has been busy discounting.
Short term outlook is uncertain
Air New Zealand admits the short term outlook is uncertain. But Chief Executive Officer Greg Foran has cited his airline’s resilience and nimbleness as key factors in countering the downturn. He said;
“Air New Zealanders from across the business have been working around the clock to manage the impact of the Covid-19 outbreak on our operations. Our business is resilient, and we have demonstrated the ability time and again to respond quickly to changing market conditions.
“We have a highly capable and experienced senior leadership team who have dealt with challenges such as this before and I am confident that we will effectively navigate our way through this.”
While these $9 fares are likely to be snapped up quickly, the promotion is indicative of some deep discounting in the Asia Pacific region. While cases of coronavirus are popping up in the region, they seem contained. But with countries starting to close borders to travelers from certain countries and imposing quarantine periods, the question is whether passengers will risk been caught somewhere.
A bargain airfare won’t necessarily offset that risk.