50 years of Air New Zealand

On 30 April 1990, Air New Zealand paid for an advertising supplement in the Evening Post celebrating 50 years of the airline.  On the front page Qantas paid for the above ad.

The whole supplement is included below. followed by the specific articles.  The feature included a full page ad by the airline noting it had flown over 350 million kilometres from 1940 until 1990, and over 200 international flights a week. The airline has grown substantially since then. Also included is a photograph that appears to depict an early airport terminal (not clear which one to me). 

Articles cover the following topics:

• The first ever passenger of TEAL, who paid £25 at the time (1940) to fly from Sydney to Auckland.
• First Day Cover and Stamp issued for the airline's 50th anniversary depicting the Shorts Empire flying boat that operated the first flight, carrying 10 passengers across the Tasman at a speed of 220km/h, and depicting the airline's newest aircraft at the time - the Boeing 747-400.
• Cakes served on all flights to commemorate the anniversary.
• The Solent Flying Boat Preservation Society and the preservation of flying boats
• A brief history of the airline and its fleet from 1940 until 1990

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)

1990 - Does Air New Zealand need to make a major fleet decision?

In 1990, Martyn Gosling wrote in the Dominion that Air NZ needed to make a major decision about its international aircraft fleet soon to "replace its entire fleet". It came to pass that the decision it actually made was to acquire the Boeing 767-300ER, but the article focuses heavily on the Airbus A340, which the airline did not buy.  The article appears driven by Airbus saying that unless Air NZ orders the Airbus A340 soon, it will not be able to get any until the mid or late 90s, and that would mean Air NZ would be "forced" to pay more, to buy a Boeing aircraft sooner.  The article claims the airline needs to consider replacements for its Boeing 747-200 fleet and Boeing 767-200ER fleet for the late 1990s.  In fact, the 747-200s were not phased out completely until 2000 and were replaced by Boeing 747-400s, that had initially been leased to Cathay Pacific (due to an industrial dispute), and the 767-200ERs were not phased out until 2005.

The article notes that Air NZ had been privatised in 1989 to a Brierley consortium including Qantas, JAL and American Airlines, and speculated that airline management had been focused on business other than fleet replacement, including the floating of 30% of the airline's shares on the stockmarket.  There are questionable claims, like how the Airbus A340 would be an "ideal" complement, to the 747, although later experience indicated that it was a poor alternative to the Boeing 777 (although this would not appear in Air NZ's fleet until 2005).

A good deal of the article appears based on Airbus marketing, as it was frustrated that Qantas did not order the Airbus A340, and touted it as "missing out" on the latest technology and lower seat costs. Airbus was also selling the A330, at the time it was seen as a medium-haul wide body in competition with the 767, with the A340 being for long haul (with four engines in the age before ETOPS gave the A330, 767 and 777 permission to render the A340 and eventually 747 redundant).  Airbus appeared frustrated that Air NZ had never ordered from it (and it did not until its first Airbus A320s arrived in 2003 to replace Boeing 737-300s on short-haul international routes. 

It was noticed that 1990 was a period with high demand for new aircraft.  Apparently Continental Airlines (which subsequently pulled out of NZ, and merged with United in 2012) claimed it would fly A340s from LAX to AKL (it did not).  The Airbus A340 was not introduced into service until 1993, and although it had some early success, it was overshadowed within a few years by the Boeing 777 and production ceased in 2012.  

The article notes availability of the McDonnell Douglas MD-11, but it is described as "interim technology" (and its performance was underwhelming compared to the Airbus A340.  It warned that Air NZ better order aircraft soon or it would have a "fleet of old buses".

In conclusion, the article proved wrong. Air NZ ordered the Boeing 767-300ER as its mid-sized long haul aircraft and operated them from 1991 to 2017, primarily to Asia, but also to Perth and the stopping services across the Pacific such as AKL-PPT-LAX and AKL-RAR-LAX.

Air New Zealand withdraws the Fokker F-27 Friendship

The Fokker F-27 Friendship was the most successful Dutch built airliner in history, and one of the pioneers of short haul aviation in the turboprop/jet era. It first flew in 1955. In many countries the F27 opened up regional air services offering turboprop speed and efficiency with a pressurised cabin, powered by the revolutionary (for its day) Rolls-Royce Dart engine.

In New Zealand, the F-27 replaced the piston-powered Douglas DC-3 on regional routes, and launched services to Dunedin's then new Momona Airport in 1962.  NAC flew thirteen of the F-27 100 series and five of the F-27 500 series, and became the mainstay for flights to all airports outside Auckland, Wellington, Christchurch, Dunedin trunk services.  Air NZ flew the aircraft until 1990, after which it flew some regional routes with Boeing 737-200 aircraft (notably Hamilton, Napier, Palmerston North and Invercargill), but also let its subsidiaries Air Nelson, Eagle Airways and Mount Cook Airline take over the routes with their aircraft.

The choice of the F27 was in spite of pressure from the British Government to the New Zealand Government to buy the British-made Handley-Page Herald. The Herald was in many ways similar to the F27, that first flew in 1955, but with one critical difference - the Herald was powered by piston-engines, whereas the F27 was powered by turboprops (which at the time were "state-of-the-art" having already launched a new era of air travel with the Vickers Viscount, which NAC had already ordered and was operating on main routes). Handley Page thought that moving to the new technology was too risky, but the Rolls Royce Dart turboprop engine was already proven on the Vickers Viscount, and the Dutch Fokker company's choice was the same engine. Handley Page had no orders for the Herald by 1958, when it decided to reconfigure the aircraft to accommodate the same engine.  By then the F27 was already flying. Ultimately, the Handley Page Herald was a commercial failure for the manufacturer.  Production stopped in 1968 with only 50 built, whereas the Fokker F-27 Friendship was produced until 1987 with 586 built.  The HS748 was produced until 1988 with 380 built. Handley Page went into receivership in 1969, and was taken over by aircraft engineering firm Scottish Aviation, until it was merged into British Aerospace in 1977.  The Fokker F27 Friendship could carry a larger payload, and so for NAC there were never any regrets in rejecting pressure to buy British (the same pressure would be brought to bear ten years later for the BAC 1-11, but was ignored in favour of the Boeing 737-200).

The F27 revolutionised transport between the regions and the main centres, linking towns like Kaitaia, Gisborne, Westport and Whakatane to Auckland, Wellington and Christchurch in a matter of an hour or so, and while in the 60s and 70s it was mainly the preserve of business and wealthier travellers, by the 1980s flying to regional centres was becoming more mainstream.  The number of regional airports opened up by the F27 was considerable.  From north to south they flew to Kaitaia, Whangarei, Hamilton, Tauranga, Whakatane, Rotorua, Taupo, Gisborne, Napier, New Plymouth, Wanganui, Palmerston North, Nelson, Blenheim, Westport, Hokitika, Timaru, Oamaru and Invercargill. They also flew international services from Auckland to Norfolk Island for some years.  

This post has a series of articles following the announcement of the retirement of the aircraft in 1990. The descriptions are under each article.

This first article is written by former NAC Chief Executive Doug Patterson who writes on how the policy of NAC was to use profits from the main trunk services (operated by Boeing 737-200s) to cross-subsidise unprofitable regional routes (operated by F27 Friendships).  He claimed in NAC's last year it lost $7.093m on provincial routes, offset by profits of $7.825m on main trunk routes.  He noted the biggest losses were services from Napier to Auckland and Wellington losing $1.14m, Auckland-Hamilton-Wellington losing $0.974m and New Plymouth to Auckland and Wellington losing $0.887m.  He noted that even in 1978 steps were "being taken" to surrender some lightly patronised services to other operators, including services with five or fewer passengers.  Patterson's article appears critical of the deregulation of the sector and especially critical of the Lange Government enabling Ansett to operate domestically in New Zealand and blames this for the demise of the F27 Friendship services.  He projected many regional centres would be served by very small aircraft with no room to stand up on board, and of course he was largely proven wrong. He said New Zealand didn't have the population to support competition and multiple carriers, but this would also be proven wrong. Regional routes were made profitable by Air NZ's subsidiaries, and are profitable today, although some routes have been abandoned by the airline (notably Oamaru, Whanganui, Westport and Kaitaia). 

The Evening Post on 4 August 1990 wrote its editorial "Farewell to Friendships".  It noted that as Air NZ had been privatised, it no longer was obliged to run unprofitable services and competition from Ansett NZ was making it difficult to sustain lightly patronised regional routes with 48-seat aircraft. It noted that competition had been good, as it forced Air NZ to refurbish the old terminal at Wellington, and the arrival of airbridges, more reliable luggage collection and inflight snacks were all welcomed.  The editorial did note Wellington would get more noisy Boeing 737 flights as a result, but it also meant 600 jobs would be lost, months out from the 1990 General Election (which Labour lost in a landslide)

The Dominion editorial of 20 August 1990 also noted that competition from Ansett New Zealand is the reason Air NZ was phasing out F27 services, as it couldn't sustain being competitive on the trunk whilst cross-subsidising the F27 services.  It described some elements of competition as expensive silliness, like in-flight meals, business class and in-flight alcohol. It isn't dismissive of the changes, but does suggest that letting Ansett NZ fly in NZ was an expensive mistake, and it could result in a loss of some Air NZ international services. 

This article by Roger Foley describes the story behind the choice of the F27 by NAC.  It noted the only serious accident for the type for Air NZ was in 1979 when one landed short at Auckland, killing the pilot and flight engineer.  It also notes that Air NZ's maintenance of the type saw it win contracts with overseas operators. The article notes former NAC CEO Doug Patterson's dismay at the entry of Ansett NZ as competitor, undermining the old model of Air NZ subsidising regional services with the main trunk, as he wondered "what sort of services" cities like New Plymouth would now get. Of course, Air Nelson, Mount Cook Airline and Eagle Airways under the auspices of Air NZ would ensure most regional routes would thrive with higher frequencies and lower fares than ever before.

Safe Air - Phasing out of Bristol Freighters in 1985 and closing down in 1990

Safe Air (a subsidiary of NAC  (then Air NZ post merger) from 1972) was once a stalwart operator of both Wellington and Blenheim airports, and I grew up with the drone of Bristol Freighters taking off from Wellington Airport multiple times each day, with their piston engines and bumble bee shape, and less frequently the quiet but larger and visually appealing Armstrong-Whitworth Argosy aircraft with their bulbous nose and twin tails, and as the only four-engined turboprops to fly regularly to and from Wellington, besides occasional visits by RNZAF Hercules (since the demise of the NAC Vickers Viscounts 1in 1975). It is remarkable how important air cargo was for decades across Cook Strait, reflecting a time when shipping was largely not containerised, and the inter island ferries had little competition for freight.  Today most domestic air cargo goes in the belly of scheduled passenger services, with the exception of air cargo Boeing 737s flown by Parcelair between several main centres.

First is an article about the end of the Bristol Freighters in 1985. The Bristol Freighters were unpressurised, and mostly flew freight inter island between Wellington and Blenheim (and before the opening of Wellington Airport in 1959 flew freight from Paraparaumu, under contract for the Railways Department).  The Bristol Freighters also operated until 1982, regular (subsidised contracted to the Department of Internal Affairs) services to the Chatham Islands, carrying passengers as well. This is more fully described in the 3rd Level blog here.  Passengers were also carried in small numbers across Cook Strait if accompanying freight such as cars, but the experience was far from pleasant, with earmuffs supplied in the latter years. For aircraft manufactured 1951-1958, the Bristol Freighters operated for a long time in NZ, and for some years Safe Air was the world's largest operators of Bristol Freighters. 

The second article is about the withdrawal of the Argosy aircraft, which primarily operated freight services between the main centres, including overnight between Auckland and Christchurch. The Argosy were noted for having a purpose-built passenger capsule that was inserted into the pressurised cabin, to carry passengers on the Chatham Islands route.  The Chatham's Island service ended in 1990 following decision by the Government to cease subsidies for the route, the age of the Argosy aircraft and a significant downturn in air cargo demand.  Air NZ chose to cease Safe Air's airline operations that year. The Chathams were subsequently serviced by Mount Cook Airline HS748s on a commercial basis, but also saw the small local airline Air Chathams acquire aircraft of sufficient size to fly to the North and South Islands, which it continues today (Mount Cook Airline discontinued services in 1996 as it was phasing out the HS748 and had decided the replacement ATR72 aircraft could not operate the service economically).

  

Air NZ - NAC Merger to end? (No)

In 1990 Evening Post transport reporter Shayne Currie wrote an article which claimed that the 1978 merger between state-owned domestic airline NAC (National Airways Corporation) and state-owned international airline Air New Zealand was about to be reversed on 1 January 1991. He was clearly mistaken. 

Some of the claims in the article were:

• Air NZ has excessive overcapacity on domestic routes, due to competition.
• Former NAC CEO Doug Patterson claimed that most benefits from the merger did not occur, and the "sole reason" behind the merger was to give Air NZ more sales offices to compete with overseas airlines.  The domestic and international airlines are "completely different types of businesses".
• Former Air NZ CEO Morrie Davis disputes that, saying it was cross utilisation of staff, aircraft and combined marketing and sales, and claims that had Air NZ's competitive culture not been introduced into NAC, NAC would have lost millions during the late 70s and early 80s due to an aviation industry recession and fuel price increases.
• In 1978 Air NZ had 5,200 staff and carried 910,000 passengers p.a. and NAC had 3,500 staff carrying 2.3m passengers p.a.  NAC made a $4m profit and Air NZ a $3.3m profit.
• The merger was meant to generate savings of $10m through rationalising staff, buildings and equipment, improve services, enable international aircraft to operate on busy domestic routes, infuse competitive attitudes in domestic services and increase domestic freight capacity.
• Doug Patterson claims that had NAC been separate it could have "convinced" government to stop Ansett starting Ansett New Zealand because it "would have been able to put to him in a more effective way the consequences of letting Ansett in".

Airlines split from unhappy marriage

Two long haul international flights in 1990 - a review of flying on the Boeing 747-400

 

It was September 1990 and Evening Post aviation journalist Martyn Gosling wrote about what it was like to make two long haul flights, his first on the then then Boeing 747-400. Notable because the 747-400 had range that enabled non-stop flights between New Zealand and the USA, and one-stop flights to Europe via Asia.  The photo of then Air NZ CEO Jim Scott in a first class seat is not the story of this article.

He noted that although Boeing leads, the Airbus A340 would be available from 1992. He notes that the Economy Class seats of Boeing 707s in 1960 had similar seat widths as the 747-400 in 1990, of 43.6cm, but there is less leg-room and reduced padding.  He also described the conditions on a long-haul flight that affect health, such as the 10% humidity seen in a desert. 

He flew Singapore to Europe on Qantas, and returned on UTA (a now-defunct French airline that was absorbed by Air France fully by 1992) in business class (which at the time would have been only slightly more comfortable than today's premium economy). He preferred Qantas. 

The article notes that Virgin Atlantic apparently wanted a 100-seat Airbus A340 to fly non-stop London-Perth (which like so many statements by Richard Branson, didn't happen).   Finally it notes tests underway for a new entertainment system with personal video screens!

Last Safe Air Argosy

Last Safe Air Argosy flight

Straits Air Freight Express (SAFE Air) was a mainstay of cross Cook Strait air services for decades.  Part of its service over the years is the little known New Zealand Railways Air Services which survived until 1983, but SAFE Air was a key air freight provider beyond that. In 1972 SAFE Air was bought by the National Airways Corporation (NAC), so it was inherited by Air New Zealand.  The Argosy fleet operated from 1968 primarily longer distance freight flights, and for some time (1982-1990) operated passenger services to the Chatham Islands with a custom built pressurised passenger capsule. 

As a Wellingtonian, the sound of the two Armstrong Whitworth Argosy's was a mainstay of SAFE Air services, distinct from the older noisier Bristol Freighters, with their distinct appearance and gentle drone.