Almost 1700 jobs in Air New Zealand's airport services division could be up for the chop unless it becomes more competitive.
The airline said tonight that unless it could improve the competitiveness of the business it would be forced to look to a third party airport services provider to deliverthis service.
Airport services is the part of Air New Zealand that manages processes ranging from check-in to tarmac operations and loading luggage for Air New Zealand and many other airlines in New Zealand.
It employs 1675 full and part-time staff based at Auckland, Wellington and Christchurch airports.
Group general manager people Vanessa Stoddart said the airport services business was currently facing severe challenges.
"We have been working with staff representatives for many months to explore ways of improving the competitiveness of airport services and to reduce the loss of third party work as other airlines operating in New Zealand move to other suppliers. To date the speed of progress made has not been sufficient," Ms Stoddart said.
She said in the past two weeks, Air New Zealand's second largest airline customer in New Zealand had terminated their contract.
They had done this "because they perceive that Air New Zealand can no longer provide a competitive service."
Ms Stoddart said the loss of that contract could jeopardise approximately 160 jobs.
The airline said it had been advised by unions that they wanted to enter a 58-day consultation process over the future direction of airport services.
Air New Zealand said it had meetings with unions last week to outline the scale and urgency of the problem.
A key issue for the airline was "its (airport services) current lack of flexibility to meet customer needs due to restrictive work practices," Ms Stoddart said.
The airline would tell staff of the next steps by the end of the week.
Air New Zealand said if it did outsource airport services, it would expect the new provider to employ most of the existing staff.
