Load Factors On Main Air Routes Defended

Press, Volume CV, Issue 31060, 16 May 1966, Page 12

Load Factors On Main Air Routes Defended

Load factors on National Airways Corporation main trunk routes ranging from 74 per cent to 80 per cent from December to April are given by the airline’s general manager (Mr D. A. Patterson) in comment on a letter to the editor of “The Press.” Mr Patterson says that air service to many parts of New Zealand is provided at a loss, and is accordingly supported by the profitable trunk services. which must have a comparatively high load factor consistent with meeting passenger demand.

The correspondent “Frustrated,” writes:—

“There have been arguments in the press as to what type of plane N.A.C. should purchase. I suggest any plane, as long as it flies. It would be interesting to know how much business N.A.C. is losing at the present time through its utter inability to cater for the traffic. Proof. Would N.A.C. be prepared to publish their loading for their main line Christchurch, Wellington, Auckland, since last December? Overseas, 60 per cent loading is considered profitable. Over 60 per cent it is considered service is not being given to the public.” Reply

Mr Patterson says:— I am pleased to give your correspondent the passenger load factors in N.A.C. main trunk routes covering the period December, 1965, through to April this year. They are-Christchurch-Auckland, 80 per cent; Christchurch - Wellington, .76 per cent; AucklandWellington, 74 per cent. “Load factors are not an indicator of profitability, in certain types of airline operation, and on international services in particular, where high aircraft utilisation can be obtained, profitability can be achieved at comparatively low load factors. It is, however, a very different picture on ultra short-haul services where aircraft utilisation is much lower because of frequent .stops such as NAC operates.

In considering the domestic airline operation in New Zealand, ‘Frustrated* should the N.Z.N.A.C. Act, 1945, which prescribes that ser‘"“ducted to the needs of the people ealand Proper regard to over-all economic ?. pe " tK>n : NA.C. administers the Act by providing service to most parts of New Zealand and many of these are sus-

tained at substantial economic penalty. They are accordingly supported by the profitable trunk services. “In this environment the load factor on trunk routes must be contained at a comparatively high figure consistent with meeting the passenger demand. The load factors during the peak season mentioned above are reasonable in these circumstances, and indicate that the over-all demand is being met by the capacity provided. Australian Figures “As a matter of interest, both Australian airlines are currently experiencing load factors approaching 80 per cent on the Sydney-Melbourne service. “It is recognised that the public have preferred times of the day for travel and that these flights are generally heavily booked. These prefer ences present a world-wide problem affecting domestic carriers. As aeroplanes involve a heavy capital cost, no airline can afford to set apart spare capacity purely to meet intermittent peak traffic d< mand. Airlines meet the position by the frequency of services provided in relation to the seat capacity of the aircraft.

i “N.A.C. is planning for the introduction of jet aircraft in 1968 as part of a programme to meet forward capacity demand at the appropriate point of time. “N.A.C. currently otters nine daily outlets horn Christchurch - three Christchurch-Au^ with additional scheduled services on Monday and r nd y-