In 1990: Can Air New Zealand compete?

In another of a regular series of articles on aviation, Martyn Gosling of the Dominion wrote the article below about Air NZ which was fundamentally based on whether or not it could succeed against competition, following its privatisation in 1989.

Some key points from the article are:

• Air NZ spends more promoting tourism to NZ than all other entities put together
• The airline has a strong reputation with the public, based mainly on its international service.
• Its reputation domestically was different, in part because it flew from the old terminal in Wellington, with poor service (noting the infamous pack of cheese that was difficult to unwrap and highly processed (and with little taste).
• A brief history of major challenges to the airline in recent years. Including Erebus in 1979, the Christmas 1984 cabin crew strike and the emergence of Newmans Air then Ansett NZ.
• Arrival of Ansett NZ as majority foreign owned was "unprecedented" for domestic airline access anywhere in the world, noting Australia wouldn't let Air NZ fly domestically in Australia. Air NZ fought back against Ansett NZ, with airbridges and on-board meals, and Ansett took over 100% of Ansett NZ as Brierleys pulled out. 
• Privatisation of Air NZ was a sale to Qantas, American Airlines and JAL, not British Airways as Air New Zealand wanted.  Apparently Australian and NZ government were both interested in a Qantas-Air NZ merger, so it came that Qantas owned 25% of Air NZ.
• Industrial relations remain fraught, with the latest issue being pilots refusing to crew the airline's Boeing 747-400

Fundamentally the article has little of substance to support any analysis as to whether Air NZ would thrive under competition or not.  It clearly was doing ok on domestic services, but there is little comment about international. 

The neighbouring article accurately summarises the airline's history from the days of flying boats.  It noted the airline chose to buy smaller airlines to replace Fokker Friendships. It notes some of the key competition challenges for the airline faces, notably:

• Domestic competition
• Noise restrictions emerging especially at Wellington Airport (affecting operation of Boeing 737-300 series - this was subsequently addressed by the airline buying hush kits)
• Acquiring third-level airlines (Air Nelson, Eagle Airways) to take over regional routes from its own Fokker Friendship fleet

It was noted that at the time of the article (April 1990), Air NZ's fleet comprised of:

• 5 Boeing 747-200
• 7 Boeing 767-200ER
• 11 Boeing 737-200 (including some Advanced series, although the article mistakenly listed them all as such)
• 10 Fokker Friendship F-27 500
• 5 Fokker Friendship F-27 100 (being phased out)
• 1 Boeing 747-400 (leased out to Cathay Pacific)

On order were:

• 2 Boeing 747-400
• 5 Boeing 767-300ER (although that type was not specified in the article)
• 6 Boeing 737-200 Advanced (called "quiet", which was a misnomer as the Boeing 737-300 order did not come for some years)