Group General Manager International Airline Ed Sims says aggressive pricing and innovative marketing in the United States has seen bookings improve in recent weeks.

"At this stage, with bookings up week-on-week, indications are we've stemmed the short-term demand fall which is good news for tourism operators.

"Cumulatively we remain a long way below last year's bookings. Nonetheless we are now more confident that we will not have to reduce capacity further than the 9% already in place for the next four months.

"It certainly is encouraging to see that in the face of an economic crisis in the world's largest economy, US consumers are still prepared to spend when they spot a great product at bargain prices. New Zealand's appeal as a clean, green and safe destination has never been more valued.

"The challenge we therefore now face collectively as an industry is to invest further in our nation's presence offshore. We will have to work more collectively than ever to grow demand long-term during this challenging economic cycle and claw back some of the decline we have seen over the last twelve months," says Mr Sims.

Air New Zealand is currently promoting special return economy fares from Los Angeles and San Francisco to Auckland for as low as US$738 (18% saving), Premium Economy US$2359 (30% saving) and Business Premier US$5400 (46% saving).

Air New Zealand has also started a pricing and marketing campaign in the United Kingdom to entice more Brits to New Zealand, promoting bargain specials of return London-Auckland fares for just £571.

"We spend over $100 million annually on international sales and marketing activities, helping to attract the 800,000 offshore visitors who fly with us to New Zealand each year," says Mr Sims.

"On top of these special deals, thanks to the weak New Zealand dollar, Americans can now visit and enjoy a half-price holiday which is a unique selling point for the country with today's cash conscious tourists."

Kiwis looking for a cheap long-haul fare are not out of luck.

Specials include cheap economy class fares to Asia, companion fare deals for Premium Economy and Business Premier Classes to a number of destinations and weekly grabaseat $1 reserve International Auctions.

Ends

Issued by Air New Zealand Public Affairs 09 336 2761

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.

For more information about Air New Zealand visit www.airnewzealand.com and for more information about Star Alliance visit www.staralliance.com.