Air New Zealand to acquire 14 new Airbus A320 aircraft

Air New Zealand Ltd, the nation's largest airline will replace 14 new Airbus SAS A320 aircraft to replace Boeing 737-300 jets currently in use on domestic routes.

The airline has purchase rights for 11 additional A320s, it said in a statement. The aircraft are worth $1 billion but Air New Zealand bought the planes at an undisclosed discount reflecting present market conditions, the airline said.

The airline said that it has been reviewing its domestic jet fleet to improve fuel efficiency and enhance capacity on routes connecting the nation's largest cities. The larger A320 aircraft is already in operation on its routes to Australian and the Pacific Islands, which is expected to save costs in maintenance and fleet management, the airline said.

According to Bruce Parton, group general manager, short-haul it was a very good time to buy aircraft with the demand being depressed and the industry being at the bottom of a deep cycle which offered favourable conditions for buyers with strong balance sheets.

The first A320 is set to arrive in January 2011 and the balance will be progressively inducted through to 2016. The new aircraft which will carry about 170 passengers up from 133 in the existing 737 fleet will be powered by an advanced version of the International Aero Engines V2500 engine.

According to industry analysts both Airbus and Boeing will be short on orders this year with airline industry in the grip of the worst downturn in decades.

Airlines body IATA said on Tuesday the financial performance of carriers appears to be improving in the third quarter but said the industry would be in the red for $11 billion in 2009.

Airlines lobby IATA said on Tuesday that the financial performance of carriers appeared to have improved in the third quarter but repeated its forecast for $11 billion in industry losses in 2009.