Air New Zealand has more than 12,500 employees. Some are being encouraged to take leave, a union says.
A hiring freeze has been applied to some parts of Air New Zealand as the airline grapples with challenges emerging from the coronavirus crisis, a union says.
The airline has also postponed its 80th anniversary celebration, scheduled to be held in Auckland on March 5, because managers are too busy dealing with fallout from the deadly virus, which the World Health Organisation says has killed nearly 3000 people and infected more than 80,000.
“We regret to advise that we have decided to postpone this event due to the current impact of the coronavirus on Air New Zealand,” Air New Zealand chairman Dame Therese Walsh said in an email to guests.
“As you can appreciate our senior leaders are keenly focused on navigating our way through this challenge facing the airline and the tourism industry as well as supporting our staff in the most impacted offshore regions.”
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E tū union’s aviation spokesman Savage said airlines were struggling with significantly reduced passenger numbers and cargo loads.
As a result airlines, including Air New Zealand, were having to think about how they managed staff that worked on services affected by coronavirus.
“Certainly there are parts of Air New Zealand where recruitment has been put on hold,” Savage said.
Airlines with New Zealand crew or ground crew had been redeploying staff to other areas of the business and encouraging staff to use up annual leave, he said.
So far there had been no job losses as a result of coronavirus scheduling changes, he said.
Air New Zealand has more than 12,500 staff worldwide.
An airline spokeswoman said it had not implemented a hiring freeze but had asked crew for expressions of interest in taking leave without pay for a short period.
On Monday, ahead of reporting its interim financial results on Thursday, Air New Zealand warned that its revenue outlook for the remainder of the 2020 financial year was expected to be adversely impacted as a result of softer demand for travel to and from Asian destinations as a result of coronavirus.
The airline expected a net negative impact to earnings in the range of $35 million to $75m as a result of coronavirus and downgraded its earnings forecast range from about $300m to $350m, down from its previous guidance of $350m to $450m set in August.
Air New Zealand had earlier announced it was reducing its capacity to Hong Kong and further reducing its Shanghai service due to the impact of coronavirus on customer demand.
The airline’s Seoul route would also be temporarily suspended from March 8 until June 30 and total Asia capacity would reduce by 17 per cent for February through to June.
Tasman capacity would reduce by 3 per cent from March through May and domestic capacity would reduce by 2 per cent across March and April, focused on Christchurch and Queenstown services to and from Auckland.
On Thursday Qantas said it would implement a hiring freeze as it looked to reduce capacity to Asia by 15 per cent until at least the end of May.
It was also reducing flights to New Zealand by 6 per cent with cancellations on three New Zealand routes while its subsidiary Jetstar will reduce trans-Tasman flights by 5 per cent.
Qantas chief executive Alan Joyce said the changes were in response to a drop in demand due to coronavirus.
“The capacity we’re taking out is the equivalent of grounding 18 aircraft across Qantas and Jetstar until the end of May, which in turn impacts about 700 full time roles,” Joyce said.
“To avoid job losses we’ll be using leave balances across our workforce of 30,000 and freezing recruitment to help ride this out.”
There would be cancellations on Qantas’ Sydney-Auckland, Melbourne-Auckland and Brisbane-Christchurch routes, it said.
The Australian flag carrier made the announcement as part of its half year financial results, where the impact of coronavirus was estimated at between A$100 million (NZ$105) to $150m profit before tax for the full 2020 financial year.