'l2p.c. fare rise in air’

Press, 16 August 1978, Page 6

'l2p.c. fare rise in air’

PA Wellington Domestic air fare increases averaging 12 per cent are expected to be sought by Air New Zealand within a week, according to aviation industry sources. Since the last fare rise of 8 6 per cent "tn July last year, the airline has faced increased costs of about SIOM, mainly from wage and salary increases. Air New Zealand management officials would not comment on the size of the increase they will seek. But airline sources say it will be an average of 12 per cent, and the application will probably be filed within seven days.

It is not known what the; percentage range will be, but it is believed that the need; i for a range comes from a decision from the Air Services Licensing Authority at! the time of the last increase to N.A.C. The authority ruled then that the airline should adapt its calculations so that in-; creases on al! fares were consistent, rather than having anomalies created by varying cash increase based on a flat percentage. In recent years the former N.A.C. (now Air New Zea-' land's domestic division) has applied annually for both passenger and freight rate! increases—and several times has applied twice a year. The

i; last increase granted was .nearly 4 per cent less than I ’ sought and it was expected ijthat another application ■ would have been lodged late last year or early this year. However, the merger of N.A.C. and Air New Zealand from April 1 this year intervened and delayed this latest application. ; The domestic division of Air New Zealand is expected to announce a net profit in the last financial year as ■ much as 36 per cent up on 'the $3.2M the previous year. “However, the profit of the international division is expected to be down as much as 40 per cent on the $11.7M it made in 1976-77.