Air NZ eyes route to China

China may be one of Air New Zealand's next destinations, an airline executive signalled yesterday.

Norm Thompson, Air New Zealand's head of sales and marketing, said China still figured heavily in the company's expansion plans.

"For Air New Zealand, China is definitely a strong contender to become a new route," Thompson told a large audience on the final day of a tourism industry conference in Auckland.

He acknowledged that the airline's expansion into the Chinese market had been the source of much speculation in the industry. Some expected the announcement to come as early as last year.

Passenger demand for the service existed, said Thompson. Last year, 84,000 Chinese tourists visited New Zealand, nearly a 28 per cent increase from the year before. About 45,000 Kiwis flew to China in 2004, making it the fifth most visited destination by New Zealanders.

And those numbers are set to increase at astounding rates. In the next six years, arrivals from China are forecast to leap 124 per cent, reaching 189,000 visitors by 2011.

Direct flights from a location such as Shanghai, China's commercial capital, to Auckland would be essential for the tourism industry to meet those projections.

Thompson did not say how soon the airline would decide on the destination. Adding flights to Britain and Singapore were also a possibility. He did remark that internal discussions about expansion plans and even the possibility of cutting some routes were underway. Thompson said any decision to enter the Chinese market would be weighed against failed endeavours to crack it by such rival carriers as Qantas Airlines.

A Qantas spokesman confirmed that the airline had withdrawn its services from China "on at least one occasion". Qantas flies from Australia to Shanghai and is planning to resume flights to Beijing by next year at the latest.

An expansion into the market would be limited to seven flights a week as a result of an agreement between the two governments reached in March last year.

Meanwhile, a strike by Boeing assembly staff in Seattle is causing ongoing headaches for Air New Zealand, which expected delivery of some of its new 777 aircraft early in October. There's no end in sight to the strike, which started this month.

Thompson called the delay "frustrating". He added that the airline was developing a contingency plan that would see scheduling changes starting at the end of next month. To date the changes would entail the cancellation of some of its Christchurch to Los Angeles flights.