Air New Zealand has revised its profit forecast for the first half of the 2025 financial year. The airline faces engine issues that have grounded a significant portion of its fleet, impacting its financial outlook. The airline identified these obstacles in its 2024 financial results in August but now downgraded its expectations for 2024.
Air New Zealand has battled engine problems with its Boeing 787 Dreamliners powered by Rolls-Royce Trent 1000 engines. The airline has faced these issues since 2015, now grounding up to four of its 14 Dreamliners. The airline’s Airbus A321neo fleet also suffers from Pratt & Whitney GTF engine issues. These problems led to six of its 12 A321neos being grounded, disrupting operations.
Up to 10 grounded aircraft, nearly 16% of Air New Zealand’s entire fleet, reveal the scale of the problem. The airline doesn’t expect relief until early 2026, despite leasing additional aircraft. The airline also faces delays with new aircraft deliveries, complicating its efforts to meet demand.
Despite setbacks, Air New Zealand focuses on long-term growth. The airline invests NZ$500 million to retrofit its 787-9 Dreamliners. It also plans NZ$3.2 billion in new aircraft by 2029. Air New Zealand aims to enhance domestic and international services while growing its loyalty program.
Air New Zealand’s first-half earnings forecast for 2024 is now NZ$120 million to NZ$160 million, down from NZ$185 million last year. The airline remains focused on its competitive strengths and digital transformation to unlock future growth.
Despite challenges, Air New Zealand’s ability to navigate these issues is critical to its success. The airline plans to leverage its strong balance sheet and strategic initiatives to grow shareholder returns.
Related stories:
Catch up on the top stories and travel deals by subscribing to our newsletter!
Leave a Reply