Air New Zealand chief executive Greg Foran has dig at Qantas' $29 flights, can't promise airfare prices will fall despite huge profit

  • 25/08/2023

Air New Zealand is flying high after returning a huge profit.

It's the first time in three years the national airline is in the clear, posting a $412 million surplus in the 12 months to June.

Air New Zealand has come under fire in recent times for skyrocketing domestic prices. 

And while chief executive Greg Foran couldn't promise prices would fall, he hoped they'd remain steady.

"We've got a portfolio that we need to balance so I would say it's great to be back in the black and being able to stand on our own two feet," he told AM co-host Laura Tupou.

"Running a business at a loss for several years makes it difficult to invest."

Foran said expenses for the likes of fuel, parts, catering, dry-cleaning and landing fees remained elevated.

"That's why I'm saying it's unlikely that we will see fares go back to 2019 levels because some of those costs aren't going to go away.

"It's really hard to speculate on what's going to happen with fares - it's been a hot topic of conversation and I expected that after you go into a profit situation that we have gone into."

Air New Zealand had cheaper airfares available but Foran said that often required booking flights as early as possible.

Greg Foran.
Greg Foran. Photo credit: Getty Images

"Fares vary around depending on when you book, generally, and so what we want to do is make sure we get a profit, we can buy some more planes, we can get some more seats out there for customers… so that we do keep our fares reasonable.

"I think we take a more measured approach to how we address things… I'm a bit averse to doing gimmicky-type sales, I'd rather us concentrate on delivering a product over a long period of time and doing a good job of doing that."

Ultra-low airfare sales, like the $29 flight deal announced by Australian counterpart Qantas on Thursday, were not sustainable and often wouldn't even cover the landing fee, Foran said. 

"I'd rather put a ticket out there for $70 and then make sure that the higher price fares actually come down - so lessen the gap between the lower and higher prices fares and that's an approach that we're taking with Air New Zealand."

Watch the full video for more.