22 April 2020

Nelson Major Maintenance for the Chop?



A proposal to close Air New Zealand's heavy maintenance facility in Nelson resulting in the loss of 100 highly-skilled jobs is "devastating", say regional leaders. Air New Zealand staff in Nelson were told on Wednesday of a proposal to end heavy maintenance of turboprop aircraft at the regional facility at Nelson Airport, with only light maintenance to be carried out.  An Air New Zealand spokeswoman said staff were told of the proposal to move turboprop aircraft heavy maintenance from the regional maintenance base in Nelson to Christchurch.  She was unable to comment on the number of jobs affected while consultation was underway but said it would see "a number of roles" in Nelson disestablished, with some having the option of redeployment to Christchurch. Heavy maintenance involves an aircraft being taken apart every 18 months to two years for inspection and overhaul as opposed to light or line maintenance which involves overnight checks as well as minor scheduled maintenance tasks. Nelson MP Nick Smith said the proposal was a "brutal blow" that would cost Nelson 100 jobs, $10 million a year in regional income and would have larger flow on impacts. While it was not surprising the airline was downsizing its aircraft maintenance with the global collapse in aviation, Smith said he was disappointed in the closure of the Nelson facility. "The worry is that we will not recover these skilled jobs when the Covid-19 emergency is behind us. The only consolation is the retention of the light overnight maintenance." Smith said he hoped the proposal would be reconsidered by the Government, as the majority shareholder in Air New Zealand it was currently providing it with "hundreds of millions of dollars of financial support". "These jobs are critical to regional New Zealand and we should be leaving the door open to this heavy engineering work being returned to Nelson." Smith said the Government needed to take an industry-wide perspective on its $600 million support package which did not support smaller airlines like Sounds Air and Origin, that were now even more important to regions like Nelson. A petition to 'Save Sounds Air' was launched by KaikĊura National MP Stuart Smith, calling for the Government to support the airline through its $600 million aviation sector relief package. By 4pm on Wednesday it had gained more than 18,000 signatures. Air New Zealand has previously announced it is laying off 387 pilots as part of a wider move to reduce its workforce by at least 3750 to make it through the coronavirus pandemic. Smith was confident air services in and out of Nelson would be retained. "Our geographical location makes travel by air to our main centres like Auckland Wellington and Christchurch attractive and viable. Nelson will retain a strong domestic tourism sector and will in time recover its international tourism business." Nelson Mayor Rachel Reese said the news was a "devastating blow" to Air New Zealand staff who were members of the Nelson Tasman community.  "It comes at a time when many families are facing financial uncertainty." She said the loss of 100 highly-skilled jobs in a workforce the size of Nelson was "extremely damaging". "We've had a strong relationship now with Air New Zealand for many decades and it is critical that the Government understands the scale of impact to the aviation sector in our region and they need to ensure that support is targeted to help us recover." Reese said the opportunity for redeployment was reasonably low and new jobs would need to be found to keep these skilled people in the region. The Crown infrastructure projects offered opportunities for employment if it was supported by Government. "We really want to get these skilled people back into employment in our region, we don't want to lose them. I urge Air New Zealand not to close the door on heavy maintenance for good. This workforce has performed really well for Air New Zealand and they deserve the opportunity for this decision to be revisited when the economic situation improves." Tasman Mayor Tim King said the proposal to axe jobs was "extremely concerning" and a further reminder of the national economic impact of Covid-19 on Nelson. "The biggest impact will be felt by these people and their families." King said he understood Air New Zealand's position, driven by conditions well beyond its control. But as a co-owner of Nelson Airport, he hoped the decision was a temporary consequence of the coronavirus pandemic that could be revisted when the economy recovered. Support from the Government as Air New Zealand's majority shareholder should take the regional ramifications of Covid-19 into account. He said the proposal demonstrated the importance of Government support for regional projects to ensure sustainable employment and economic opportunities in the future. A subsidiary of the airline, Air New Zealand Regional Maintenance Limited was formed in 2015, creating around 50 high-paid engineering jobs in a facility at the Nelson Airport. The aim was to make Nelson Australasia's preferred overhaul facility with a business that performed overnight and heavy maintenance on Q300 and ATR aircraft.  The business initially serviced Air New Zealand fleet then planned to go after customers from the Asia-Pacific. In 2017, it signed a five-year contract with Virgin Australia to overhaul 14 ATR aircraft in Nelson.  everal of those aircraft were retired after Virgin's turboprop operations in Australia were overhauled and they became a familiar sight for Nelsonians, parked up in the far corner of the Nelson Airport for a number of years. Last August, a Virgin Australia spokeswoman said six ATR aircraft were retired from the fleet in 2017, two were leased to other operators and four were being stored at Nelson Airport and would be used in the Virgin fleet when required. 

38 comments:

  1. Regional aviation in NZ is going to look very very different soon.

    Demand will have a changed and there will be a significant change in the way the airlines operate (if they survive)

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  2. This move is re-enforcing my belief that the Q300 fleet is not going to fly again, as Air NZ moves to an all ATR72-600 regional operations. If this is the case, those airports who can not handle ATR72 operations will be dropped from the regional network.

    Steve - can Hokitika handle ATRs?

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    1. Since I fly them I hope not. Hugely complicated just to manage the crew exit.

      The atr can fly anywhere the Q300 can. This arguement has often popped up.

      Reality is yes they are payload restricted but the dash often is anyway.

      There is a requirement that airnz continue to service all existing ports for a minimum of 2 years, but only IF airnz draws on the proposed loan.

      As always, terms can (and will) be negotiated as it would be ludicrous to continue operating to ports if pax loads are very low.

      Reality is that its highly probable that some regions will have a period of no flights. Chats will be in retrench/rebuild and it won't be a buoyant market for some time.

      The golden days are over for now. A new chapter in Aviation.

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    2. The Q300 hasnt stopped flying! There was one flying this morning!

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    3. To the Q300 pilot... I hope not too for you and you Q300 pilots. Kia kaha

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    4. There are many ways Air NZ can satisfy the loan requirements. Fewer flights is one. Another is wet leasing a smaller and cheaper aircraft from our 2nd levels - as long as it is flying as an Air NZ flight booked through Air NZ. Daily return flight by Saab / Metroliner / Caravan / PC-12 and deal done. Has potential for helping our 2nd levels survive.

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    5. Punters won't fly single engine

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    6. That would be violating the terms of being in the Star Alliance. Stand up cabins and a toilet is part of the deal.

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    7. Kris Yes Hokitika can take ATRs see:
      https://en.wikipedia.org/wiki/Hokitika_Airport#/media/File:Air_NZ_ATR-72_at_Hokitika,_23_September_2012..JPG

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    8. Punters won't fly single engine-- this statement is not correct.
      100,000 pax fly every year with Sounds Air, Barrier etc many airports only have this sort of air service.

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  3. This was being planned long before Covid-19

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    1. What do you think it means for Q300 operations???

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    2. This comment has been removed by the author.

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    3. Plan was to go from three heavy maintenance sites down to two to save on running costs.

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  4. From someone linked to that operation, for all people seeing this as the “demise” of the Q300, it’s important to note that this base had been converted to being a heavy ATR maintenance as well as the Q. There seems to be still a link in people’s minds that because the Q was under Air Nelson, and that the hanger is in Nelson, that it’s the Qs facility. It’s an interesting move considering it was the maintenance facility for many overseas ATR aircraft as well as Air NZ ones. No doubt the Q will be moved on in the near future, but why right now when loads to be light anyway? The ATR is cheap to run but still needs to be fairly full to get that benefit.

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    1. Moving Q300/ATR heavy engineering to Christchurch is an indication, that Air NZ is moving to have an all ATR regional operation to save money. It more cost effective to have 1 aircraft type for regional operations than having 2 aircraft types. The average age of the ATRs 3.3 years and the average age of the Q330s 13.1 years and since the airline that will still have restricted network for 2-5 years, so it makes sense to mothball and dispose the Q300's from Alert Lvl 1 onwards to be more of a mean lean operation than prior to 25 March 2020.

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    2. So how does that “indication” you have worked out line up with the amount of Regional redundancies they have announced?

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    3. It is not an indication of that at all. The RML Facility in Nelson provided heavy maintenance to both Q300 and ATR aircraft, both will be relocated to CHC if this goes ahead. Simply 'mothballing' the Q300 is profoundly more complex that you've made it out to be, and profoundly more costly, pilot retraining to begin with would be huge. As the previous poster has indicated and in the public domain, Regional Pilot and Regional Cabin Crew reduction numbers don't speak to this.
      Given that the majority ( over 80% ) of Level 4 and Level 3 flying is Q300, and likely the same for Level 2, that speaks to a trend.

      Simply put, the Q300 will absolutely not be mothballed from Level 1.

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    4. Agreed. Its a far to simplistic view. Yes the view is correct but fleet exit is a highly complicated excercise. It can (and will one day) also be very expensive (redundancy, fleet change training, base changes....).

      Yes the exit call could come overnight but it would be very expensive. I doubt there is much appetite in the immediate future in the current crisis.

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    5. Anonymous April 25, 2020 12:08 PM - "So how does that “indication” you have worked out line up with the amount of Regional redundancies they have announced?"

      You need to be more specific. How many staff redundancies where made in regional division.

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    6. None yet. The proposal is still being worked through

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    7. If you’re making these bold predictions you should have the numbers........ Air NZ has announced the numbers to the regional pilots. I’m not going to be the one to post it in here for you. We are talking about peoples jobs and lively hoods in real life, not providing figures for your predictions.

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  5. Anonymous April 25, 2020 8:13 PM - Are you saying that Air NZ will retain 2 regional aircraft types on a restricted Lvl 2 and Lvl 1 regional network?. If so, please explain how will this reduce Air NZ money?

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    1. See above.

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    2. Anonymous April 26, 2020 11:15 AM - See above. ??????

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    3. This is my first comment on this subject here. Frankly I suggest you leave planning airline operations to the operators. Air NZ, now in a very tight financial position, is not going to buy further ATR's at relatively great cost to fly them with 33 saleable seats on routes for which it already has a fleet of well maintained Dash-8's which can fly 25 passengers. Many of the routes are where low loadings post-covid will be a challenge. Its capital investment in its Dash fleet is well written down on its books; it has a large team of trained and experienced Dash pilots, and in support services and staff. The last thing that Air NZ needs at this time is an increase in its operating costs on the secondary routes where the Dash flies. The Dash fleet will be flying for some years at least, and then any transition to a replacement type will be gradual, and quite possibly to electric aircraft, not ATRs, as Air NZ has already signalled publicly some time ago.

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    4. Anonymous April 26, 2020 9:04 PM - It will depend if the Q300s are 100% owned. You must be a Q300 fun boy.

      Already Air NZ is a lean mean operator and is planning to be a meaner leaner operation, so if the airline has already spent money either as owned and leased on a new fleet of 27 ATRs with 1 suppose to be delivered 2020 and the final ATR being delivered in 2021, wouldn't it make sense to utilised the ATRs to cover borrowing and lease costs than the Q300 which you said "is well written down on its books"?

      Under the Government loan, Air NZ is expected to maintain all domestic and regional services. Air NZ has indicated that some regional destinations might be suspend hinting Hokitika, Oamaru and Whangarei and is seeking Government approval to suspend such services, indicating that the airline wants to utilise its ATR fleet more than the Q300s.

      Air NZ has a policy one aircraft type to market operations, like A320ceos for domestic jet services, A320/A321neos for short haul international services and the B787 (including the B777-200ER replacement) backed up with B777-300ERs for medium to ultra long haul international services.

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    5. Oamaru?!

      You seem to have alot of sensitive information about Air NZ "Polices" - as an employee I don't have access to such information.

      Air NZ has NOT even drawn on loan (yet anyway) so they could pull the pin on any destination, if they were prepared to deal with the public fallout.

      Transitioning crew off the Q300 onto the ATR as you suggest will simply take years, and Air NZ certainly cant afford it (or even the resources to do it). All of this to 'fulfill a policy'

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    6. And for a guy the is accusing people of being “fun boys” and seems to have all the info that even staff do t have you seem to have a lot of information. You don’t have to look hard on Air NZs paperwork to see that the Qs arnt leased and are all owned by Air NZ. As a crew member there that flies the other said aircraft than the Q even I find your figures and facts ridiculous. Arguing so hard when you don’t even know it’s destinations! It’s quite entertaining.

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    7. "Q300 fun boy?" You have a serious problem when you respond to facts with abuse. However meaningless. Mine are based on decades of experience in business including in aviation in a number of areas, large and small. Air NZ does not blindly run by applying "policies" as you claim; it is a highly sophisticated flexible organisation which can and does adjust aircraft type usage according to what its customers need. As you don't know its ownership of aircraft, destinations, or the actual costs of operating aircraft types, or from which staff Air NZ is seeking staff reductions, you have no basis on which to pontificate. Empty theory is valueless and here damaging.

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  6. 1. Changing fleets under the contracts Air NZ has with the crews doesn’t just mean get rid of the Q and bye bye all the crew off it. Senior crew of the dash have to be moved over to the ATR which requires a lot of expense and training.

    2. Under level 2 there will still be seat spacing requirements, if you look at the load % for the Q and the ATR it’s cheaper to use the Q for now.

    3. Mothballing is essentially writing off money, Qs are still worth something at a time when Air NZ needs to take what it can get. Just parking them up to sell in the future will be dead money.

    4. Massive work into changing procedures/training etc to take the ATR into those airports it doesn’t currently operate.

    5. Air NZ has said it’s going to be a mainly domestic airline, that doesn’t really line up right now to stopping nearly 50% of the regional fleet right now. Granted they will prob get more ATRs to boost that number in the future when they do move the Q on, but now isn’t that time.

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    1. It come down down to whether the Q300 are 100% owned by Air NZ or mixture of owned and leased. If there are leased, then Air NZ would operate them to cover leasing costs. The same will apply to the ATRs.

      With closed boarders the demand for regional air travel is going to small even at Lv1 1 for a while. Even if travel between Australia and NZ is allowed, whilst it will see some growth in regional air travel but not like what was seen prior to March 2020.

      Under the Government loan, Air NZ is expected to maintain all domestic and regional services. Air NZ has indicated that some regional destinations might be suspend hinting Hokitika. Oamaru and Whangarei and is seeking Government approval to suspend such services.

      Currently Air NZ has 27 ATR's with one supposedly being delivered 2020 and the final ATR is planed to be delivered in 2021.

      With the COVID-19 pandemic and the associated global recession, will see how many airlines survive what the market is going to like with surplus aircraft from failed airlines going on the market. If Air NZ did plan to sell the Q300s they wouldn't find a market so it will be cheaper to store the Q300s until markets pick up.

      Air NZ has a policy of one aircraft type to suit market, like A320ceo for domestic jet services, A320/A321neo for short haul international services, the B787 (including the B777-200ER replacement) backed up with B777-300ERs for medium to ultra long haul international services, it makes sense for the ATR being used on regional services.

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    2. "Air NZ has indicated that some regional destinations might be suspend hinting Hokitika. Oamaru and Whangarei..."

      Air NZ doesn't even fly to Oamaru. Where's your source for this info?

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    3. Kris- Air NZ don't serve Oamaru. In fact the last airline to serve that town was Mainland Air with a Chieftan in 2014

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  7. And where is your source that Air NZ seeker approval to drop those places? Being involved in the industry in one of those locations I think you’d see a bit more in the news here if they had.

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  8. It is common knowledge in business communities within some of the regions, that Air NZ was actively working to pull out of certain routes.

    Like any business. Air NZ works directly with customers on a regular basis. Which is something that wouldn't be actively witnessed to be happening in day to day operations.

    It is very plausible that people outside of the company would know this, where as staff may not be aware. As Air NZ actively works with Regional Councils, and key businesses/customers in the regions over this issue, along with many others.

    In fact some Regional councils have been investigating the idea that having a smaller operator may be better suited to their region. As there is more energy and focus put into making these smaller and more marginal routes work. As Air NZ (like any good business) prefers to market and direct their resources/staff to their more profit making routes.

    This is clearly not something that would be shared openly within the company. As there is a public and political fall out to deal with, when it comes to pulling out of routes.

    It is my understanding that if anything were to change, it would be after the election. In other words, no more Shane Jones etc!

    Also I believe it wouldn't mean a reduction in air frames, or the the retiring of the Q300. It merely freed up those air frames, crew etc, to be utilised on more profit making routes.

    Not to mention Air NZ prior to Covid, has been quietly dealing with a loyalty crisis from the Regions. When it comes to connecting to Air NZ operated international flights.

    Head office made the mistake of underestimating how much business spend comes out of the regions on international flights. There is a lot of wealth in the regions, and many significantly sized business operations outside of the main centers.

    They have taken regional loyalty for granted in many areas. And their handling of issues and complaints from regular customers, hasn't been the best. This is NOT a comment directed towards Crew, or Ground Staff. It is a head office issue.

    Obviously this has all changed with Covid. As to what happens, it could be anyone's guess now!

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  9. Do agree with a lot of ^ the above. But don’t buy that there is info that they don’t give to staff, but do pass onto someone to publish on the third level website. If it was that common knowledge the staff would know. Or maybe this is the official word........

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    1. No, Air NZ certainly wouldn't do any of that.

      But very regular customers, businesses, local business groups, communities in smaller regions. Do discuss issues that they are aware have potential of occurring.

      A good airline service to any region, is incredibly valuable. So people want to do what they can to keep it.

      There are 2 sides to the equation. The Airline and its Customers. The comments come from the customer side of the equation.

      Pre COVID, I suspect any airline is assessing their routes nearly every day (more so now). Talking with key customers about their needs, issues they may face with potential changes ... word gets around.

      Obviously, just because things are talked about among people, doesn't make it official ... only variations of the truth. Either relatively close to it, or way out of the ball park.

      This is a fantastic website which allows people to observe and comment on NZ Aviation. Be it from direct involvement, or involvement from another perspective. Nothing is official, unless it comes direct from the source.

      People observe things, share their ideas or experiences, or share things they may have heard. Purely for the joy of discussing the aviation scene. No matter how correct or incorrect they may be.

      Regarding an official stance, only Air NZ would know. And if one was going to be made, or had been made. Then I am sure staff would know about it.

      Unfortunately for everyone. The whole scene has changed, so it all is irrelevant anyway. Hopefully, all operators and their staff can find a way through this, and rebuild.

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