Budgeted loss of $14M

Press, 20 November 1981, Page 2

Budgeted loss of $14M

PA Wellington Air New Zealand is expecting a loss on 34 of its’39 domestic air services this financial year. According to a Wellington report the airline is budgeting for a total loss of SIO.BM on its domestic passenger services, and expects to lose $3.4M on its freight services. Only four of the company’s seven main trunk services and one provincial service are expected to make a profit. According to airline budgets, the AucklandChristchurch,’ Auckland-Well-

ington. Christchurch-Inver-cargill, Dunedin-Wellington, and Christchurch-Palmerston North services are profitable. They are expected to make a profit of $9.5M. However, this is heavily offset by lossds on all-other routes. According to the airline, the biggest losses are expected on the services: Nel-son-Wellington, a loss of SI.BM; Christchurch-Dunedin, SI.7M; Dunedin-Invercargill, SI.IM; Blenheim-Wellington, SI.IM; and Auckland-Tau-ranga, SI.IM. According to sources

within the airline, Air New Zealand domestic services would make a profit if the domestic air travel tax of 5 per cent and the domestic aviation fuel tax of 5c a litre were removed. ? The fuel tax aldnd cost the airline $11.7M in .the 1980-81 financial year.. The taxes made up 9 per cent of the cost of the average domestic fare. ~ If removed, fares could be cut 9 per cent or the airline could take 9 per cent more revenue at existing fare levels, the sources 1 asserted.