Significant increases in the number of passengers travelling on Air New Zealand's domestic network have seen regional economies benefiting by as much as $95 million.

Independent research carried out by the New Zealand Institute of Economic Research (NZIER), commissioned by Air New Zealand, looked at the additional economic impact the airline's lower domestic airfares have had on the New Zealand economy.

NZIER calculated that in its first 12 months, domestic Express Class boosted expenditure in the following regions as follows.

Region Additional economic benefit of domestic Express Class
Northland $5.1 million
Auckland $95.1 million
Waikato $4.1 million
Bay of Plenty $5.6 million
Hawkes Bay $11.4 million
Taranaki $3.8 million
Manawatu/Wanganui $7.9 million
Wellington $74.6 million
Upper South Island $21.1 million
Canterbury $72.9 million
Otago $39.5 million
Southland $3.9 million
Source: NZIER. Data for year to December 2003

The results were announced today in Taupo at the annual New Zealand Tourism Conference by
Air New Zealand Group General Manager Marketing, Network and Sales, Norm Thompson.

Mr Thompson said the economic benefits have been significant and widespread.

"When we introduced Express Class across our domestic network our goal was to fly more people to more places more often through lower airfares. The resulting financial benefits for communities throughout New Zealand have been substantial.

"Reducing fares by an average of 20-25% and up to 50% has certainly produced the desired result."
NZIER's analysis considered the additional spending and economic benefits that the Express service induced, over and above the benefits that were already occurring prior to the introduction of the lower fares.

The study into the impact of domestic Express Class looked at the additional economic benefits taking into account the initial injection of expenditure by tourists in a region as well as the downstream flow-on effects of that injection on businesses and households in that region.

Passenger numbers have increased dramatically since Air New Zealand introduced Express Class across its domestic network in November 2002.

Domestic network passenger increases by region
Region Passenger numbers Percentage increase
Auckland 367,548 45.0%
Waikato 19,880 18.0%
Bay of Plenty 10,065 22.2%
Taupo 4,846 23.3%
Taranaki 17,679 26.1%
Hawkes Bay 39,892 26.5%
Manawatu 35,191 26.2%
Wellington 260,063 33.6%
Upper South Island* 60,542 21.7%
Canterbury 248,696 37.6%
Otago 134,660 31.3%
Southland 17,135 11.5%
Source: Air New Zealand Results compare Pre-Express figures Nov 01 - Oct 02 with Post-Express Nov 02 – Oct 03) *Nelson/Tasman/Marlborough/West Coast


"As domestic Express Class continues to enjoy considerable growth, the ongoing benefits to New Zealand beyond this snapshot from NZIER are significant," said Mr Thompson.

"And with the new Airpoints Dollars programme commencing in November, I'm sure New Zealand businesses can look forward to even more people travelling domestically more often.

"It certainly puts into context the net positive impact Air New Zealand is having on the bottom line of this country's economy and tourism industry."

Note: The regional benefits statistics for domestic Express Class cannot be totalled to create one national figure. This is due to the fact that, for example, when someone from Wellington flies to Auckland and spends $500 during a weekend away in Auckland, they are not spending money in their home town during that time.

NOTE: The content of all Air New Zealand media releases are accurate at the time of issue, as stated at the top of each release. For updates on any changes, please contact Air New Zealand.

Air New Zealand is proud to be a member of Star Alliance. The Star Alliance network was established in 1997 as the first truly global airline alliance to offer worldwide reach, recognition and seamless service to the international traveller. Its acceptance by the market has been recognised by numerous awards, including the Air Transport World Market Leadership Award, Best Airline Alliance by both Business Traveller Magazine and Skytrax. The member airlines are: Adria Airways, Air Canada, Air China, Air New Zealand, ANA, Asiana Airlines, Austrian, Blue1, bmi, Continental Airlines, Croatia Airlines, EGYPTAIR, LOT Polish Airlines, Lufthansa, Scandinavian Airlines, Shanghai Airlines, Singapore Airlines, South African Airways, Spanair, SWISS, TAP Portugal, Turkish Airlines, THAI, United and US Airways. Aegean Airlines, Air India, Brussels Airlines and TAM have been announced as future members. Overall, the Star Alliance network offers 19,500 daily flights to 1,071 airports in 171 countries.

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