Air New Zealand cuts Hong Kong capacity, will only return to Shanghai when ban lifted

Air New Zealand used Boeing 787-9 Dreamliner on its Shanghai flights. Photo / Dean Purcell

Air New Zealand will return to Shanghai only if travel restrictions are relaxed next month and is pulling capacity from Hong Kong because the coronavirus, which has pushed aviation in China into a tailspin.

The plunge in air travel in China is described as the most devastating blow to capacity ever seen in aviation.

Air New Zealand earlier this month pulled out of its daily Shanghai service but will return every second day, subject to the current travel restrictions being lifted and the appropriate medical advice from the New Zealand Ministry of Health and the airline's medical staff.

Capacity will be reduced on the Hong Kong route throughout April and May as a result of the impact of coronavirus (COVID-19) on customer demand.

Hong Kong services, currently operated by Cathay Pacific, will resume on Air New Zealand aircraft from March 29 and will be adjusted from seven return services a week to four return services a week from April 21 to May 31. Demand on that route had fallen before coronavirus hit due to civil unrest in Hong Kong.

The airline's chief revenue officer, Cam Wallace, says the airline remains committed to its Shanghai and Hong Kong services despite the impact of the coronavirus.

Shanghai services are currently suspended until March 29 as a consequence of international travel bans affecting crew logistics and customer bookings.

The health and safety of the airline's crew and customers was ''paramount".

The airline had this week conveyed to officials in China its intention to resume services from April.

''We are grateful for officials' understanding of our temporary suspension of Shanghai services," Wallace said.

Chinese mainland carriers have slashed capacity into Auckland with arrivals falling from 2000 passengers a day to 500 per day. China Southern has suspended its services to Christchurch until the end of March.

Wallace said the coronavirus has had an impact on bookings into Shanghai and Hong Kong, and the schedule for April and May would reflect this with a lower flight frequency.

Air New Zealand will directly contact customers affected by these changes in the coming week. Customers booked via a travel agent (including online travel agents) will be contacted by their booking agent.

Cathay Pacific Airways planes at Hong Kong International Airport. Photo / AP

China has plunged from having the third largest aviation market in the world to being ranked 25th in the space of five weeks, data from OAG shows.

The schedules analyst says it is now behind Portugal in available seats and only slightly ahead of Vietnam as Chinese carriers have slashed capacity.

Most airlines from other countries that used to fly there - including Air New Zealand - have also suspended services as the coronavirus worsens.

Singapore-based OAG says the latest data for the week February 17 shows a further reduction in international capacity from China of 270,000 seats a week bringing the overall capacity reduction since January 20 to some 1.7 million international seats, a near 80 per cent reduction.

The Chinese market will see some 10.4 million fewer seats operated this week than five weeks ago. For every one international seat lost some six domestic seats have been removed from the market.

''No event that we remember has had such a devastating effect on capacity as coronavirus. In many ways it highlights the importance of the Chinese market to aviation and the rapid globalisation of air services. Ultimately the market will recover we know that, but in the short term the damage to some airlines and the long term impact on their growth may linger beyond the virus.''

FlightRadar 24 data shows traffic dropping markedly - the maps below showing the difference between February 12 and January 28.

Traffic plunged on flightradar24 between January 28 and February 12. Images / Supplied

OAG says the ultimate revenue damage to the airlines affected is clearly significant, especially at a time of year when revenue generation is for many at one of its lowest points.

Capacity also failed to recognise the impact on load-factors and anecdotal evidence suggest that those flights that are operating have much reduced load factors compared with five weeks earlier.

''It's not very often when travelling that you are asked what row you would like rather than a window or aisle.''

Hundreds of pilots have been told not to turn up to work in China.

Fallout has already hit Cathay Pacific which says it will contract its network by 30 per cent and has asked staff to take three weeks' unpaid leave. The airline was also suffering from months of reduced traffic due to the pro-democracy riots in Hong Kong.

Like other airlines it is taking hygiene measures, closing three lounges at its Hong Kong hub and doing away with buffet style food in favour of individually boxed meals.

Other airlines including Thai and China Southern have taken to Instagram to promote extra cleaning of aircraft interiors. Air New Zealand swapped out the filter on the aircraft it used to fly evacuees from Wuhan to Auckland nearly two weeks ago.