Airlines Of N.Z. Cuts Half Of Staff, Services

Press, Volume CI, Issue 29744, 10 February 1962, Page 12

Airlines Of N.Z. Cuts Half Of Staff, Services

(NX. Press Association) WELLINGTON, February 9. Drastic measures to curtail the current adverse financial position of South Pacific Airlines of New Zealand, Limited, were announced by the company’s chairman, Mr J. F. Johnston, after a board meeting this afternoon.

Mr Johnston said that the services of 50 per cent, of the company’s staff would be terminated and that air services to both Dunedin and Gisborne would cease almost immediately.

The company attributed its current position to its continued inability to achieve a reasonable economic route structure which would still preserve the National Airways Corporation's monopoly of the main trunk route and give South Pacific Airlines of New Zealand reasonable operations on other sectors, he said. The position had been greatly aggravated by the current fall in traffic that was common to the whole industry, Mr Johnston said. While his company appreciated the problems in current licensing situation, some tangible decision must be found immediately, otherwise even greater reductions in the company's air services would have to be made. These future cuts, he said, would probably apply to routes developed by his company and these included Matamata, Masterton. Alexandra, Taupo and Oamaru. Such further reductions could affect the vital Taupo link of the operation. Mr Johnston said that the airline had contributed 50 per cent, of the cost of de-

velopment of the Taupo airport. Having to put off 50 per cent, of his staff had undoubtedly been the saddest event in his life, he said. “When you think that the Air Service Licensing Act of 1951 was introduced to enable private enterprise to operate in aviation, I have no reason at all to see where this legislation has worked in anything but the reverse,” he added. Airlines of New Zealand was the only surviving scheduled airline operating in New Zealand which provided a very small measure of opposition to the State-owned National Airways Corporation. If any further reductions in services were forced upon the company, it would result in complete monopoly conditions existing in New Zealand aviation. In the vital interest of the public and his company's hundreds of New Zealand shareholders, he would seek further discussions with the Minister of Civil Aviation (Mr McAlpine) immediately. He would also place the company's position before the chairman of the Air Licensing Authority, said Mr Johnston.