27 October 2015
Kiwi Regional Announces Cuts
Kiwi Regional Airlines has slashed its its Dunedin to Queenstown service on its first day of commercial operation due to a lack of passenger demand. Hamilton-based Kiwi will also fly between Hamilton, Nelson and Dunedin. The airline's first flight arrived in Queenstown from Dunedin on Tuesday morning in the company's twin turbo-prop, twin pilot SAAB 340A, which seats 34. There were 25 passengers on board. Kiwi Regional Airlines had offered them a $89 return fare if they travelled for the day, or one-way flights from $79 up. Chief executive Ewan Wilson said he was disappointed with passenger demand on the route. "I take responsibility for putting a bit too much capacity on." He said the airline had planned twice-daily flights on the Queenstown-Dunedin route on Mondays, Wednesdays and Fridays but the market had not responded as expected. Instead, it cut the service back to an early Monday morning return flight and another on Friday afternoon. "That does mean we are available for charters on Tuesday and Thursdays. Our core schedule is Dunedin to Nelson and Nelson to Hamilton, Monday, Wednesday and Friday, Saturday and Sunday," he said. Kiwi would see how the market grew and resume those services if it was justified, he said. "It's about right-sizing the offering and hoping the market grows." The flight was scheduled to depart at 7.15am but did not leave until 8.10am because of low cloud. It was welcomed with a full water curtain salute at Queenstown Airport. Wilson said the airline's Kiwi's focus was on flying between regions and was not trying to take on Air New Zealand or Jetstar. New Zealanders liked the idea of strong competition, he said. "Now it's up to New Zealand to support the new innovator." Those at the airport to mark the arrival of the aircraft included MP for Clutha Southland Todd Barclay as well as Queenstown Chamber of Commerce and Destination Queenstown members and airport staff. Barclay said the "faster and most convenient" 40 minute flight was a breeze compared to the 3.5 hour drive between the two towns. He said the Government hoped the new regional flights would boost the level of tourism and business in the regions. "The added competition is great for consumers and great news for local economies," he said. The company was awarded its air operating certificate on Thursday, allowing it to fly commercially just days before the first flight. The airline became the first in over a decade to be issued such an approval by the Civil Aviation Authority. About 60 staff have been hired and it was hoped that number would double once the company expanded. Wilson said last week he was "very unhappy" it had been allocated Gate 1 at Queenstown Airport. "We have some real issues with Queenstown Airport's logistics." They were acting "bullish" and "don't seem hungry for new clients", he said. However, Airport Corporation operations general manager Mike Clay said Gate 1 was assigned to the airline as it was "specifically designed for Turboprop aircraft". Clay said it was disappointing to hear Wilson's comments. The airline would be keeping an eye on demand for flights and looking for further opportunities. Airline operations general manager Bill Wilson said: "if the community says we don't have a need for some of the routes, we will take that on board."
Source : http://www.stuff.co.nz/business/73379803/kiwi-regional-airlines-cuts-back-on-queenstown-flights-due-to-lack-of-demand
I can't say I'm surprised, but what a PR disaster... announcing it on the first day of services! Even back as far March I felt Queenstown-Dunedin was a lean route... http://3rdlevelnz.blogspot.co.nz/2015/03/some-thoughts-on-new-air-services-part-2.html
So where would I fly? Links through Nelson direct to Dunedin and Hamilton might work but I doubt there will be big numbers. Nelson to Tauranga, Napier and New Plymouth might also work... but to fill a Saab? Again, its all about the fares.
I still think a Masterton-Auckland would work if you get the fares right. Locals have to be lured away from Air NZ or Jetstar at Palmerston and Wellington.
When the Beech 1900s go there is one Q300 Hamilton-Palmerston North at 6.15am! and return at 7.50pm! Dreadful times in my opinion. So an early Palmerston North-Hamilton would work with the Saab then going to Nelson and Dunedin and back enabling an early evening Hamilton-Palmerston North.
Another route with possibilities is Hokitika-Wellington when the Beech 1900s go. No early morning service out of the Coast... A lot of people drive to Chch to catch Jetstar or Air NZ to Wellington. Hence Air West Coast always did well with not too much impact on the early flight out of Hokitika.
All in all however there is not a lot of room to move... I think Ewan is right in not trying to take on Air NZ but ultimately he is going to need to on some routes because there are just not the routes in NZ for a Saab that Air NZ are not already flying.
Posted by Steve L at 3:35 PM