Air New Zealand's $340 million spend-up on up to 12 new aircraft should mean more cheap seats for travellers to regional centres, chief executive Rob Fyfe says.
The company yesterday announced it would buy seven of the new ATR72-600 planes, with an option for an additional five.
The new 68-seat planes would add about two million seats a year to the domestic market and would significantly boost regional connections, he said.
"As we deploy new aircraft and we grow the number of seats we expect to see that grow the number of cheap fares available into the provincial destinations and the growth of Grabaseat fares in particular."
It would also mean a big increase in the number of seats timed for business travellers, he said. Regional passenger numbers had increased by an average 5.6 per cent annually since 2003, resulting in Air NZ's regional airlines carrying 54 per cent more passengers to a total of 4.3 million in the year ended September, Fyfe said.
Air New Zealand currently owns 11 ATR72-500s.
The first of the new turbo-prop aircraft will be delivered in October next year followed by a second in December. Two will arrive in 2013 and another each year for three years.
Fyfe said the new-generation ATR 72-600 was the most efficient aircraft in its class and featured a new cabin layout with larger overhead bins, improved seating and advanced cockpit.
Air NZ's ability to maintain services during bad weather to and from destinations like Queenstown, Rotorua and Wellington will improve with the better navigation technology.
Air NZ's Australasia Airline general manager, Bruce Parton, said the new plane gave it the means to expand routes such as Nelson-Auckland and New Plymouth-Auckland, now serviced by smaller Q300 planes.
This in turn, would release Q300 aircraft to fly on some routes which now operate 19-seat Beech 1900D planes. That could mean more seats for destinations such as Taupo and Tauranga and could also enable the airline to look at new "start-up" routes.
"So there is benefit in bringing in the larger turbo-props and cascading growth down throughout our regional operation," he said.
Parton said it was likely the new fleet would be based in Auckland. "By making this an Auckland-based fleet what we believe is that this will tap in very well into the fast-growing Auckland customer base that is really starting to spread its wings across regional New Zealand.
"This is all growth, this is not replacing any of our aircraft ... so whether it's cabin crew, whether it's pilots, whether it's ground staff or whether it's maintenance staff, this is all positive news."
ATR 72 600
68-74 seats passenger capacity.
2750 horsepower per engine maximum power at take-off.
23,000kg maximum weight at take-off.
899 nautical miles (1665km) maximum range.
* Aircraft maker formed in 1981.
* Joint venture between Alenia Aeronautica and EADS.
* Headquarters in Toulouse, France.