Small airlines dotted around the country are confident they can succeed where the national carrier couldn't - making money out of serving small-town New Zealand.
The second-tier carriers have spent millions of dollars on planes ranging from those used in the Australian outback by the Flying Doctor Service to 1950s era classic aircraft to serve Kaitaia, Whakatane and Westport.
Councils in those areas have chipped in with loans and tens of thousands of dollars to upgrade facilities and they too are optimistic, even though Air New Zealand was losing $1 million a month serving those towns.
The airline's regional carrier Eagle Air is not only pulling out of those towns, it will scale back on serving other towns over the next year and will cease as an airline after nearly 50 years of flying.
Air NZ says the numbers just aren't stacking up. Although it suffered a backlash at the time of the announcement last November, and there's still lingering anger, it is adamant it had no choice.
Air NZ chief operations officer Bruce Parton says the review of Eagle started two years ago as it started to lose considerable sums and a call needed to be made on its entire future as its 19-seater Beechcraft aircraft were coming to the end of their useful life in 2018. By then the average age of the plane would have been close to 18.
"We had a crunch point in 2018 and we had to look at what to do. Nobody makes viable 19-seaters in the market and it's a pretty simple reason - nobody makes any money out of them and nobody wants to do research and development."
Like cars, aircraft have a finite life span and the Beechcraft had suffered reliability issues. And it is cheaper cars and an improving highway network that is making life tough for big regional network carriers as travellers opt to spend more time in a car than more money on a flight.
Parton said a team of executives spent six months working on Eagle's fate. Options included putting on bigger planes but the demand wasn't there. Fuel costs weren't the issue - even if virtually free it wouldn't have made a difference, he says.
Not even close
"It wasn't even remotely close but we wanted to chase down every option for the regions themselves [and] for Eagle - these are our people."
Twin-engine, two-pilot planes are expensive per seat and Air New Zealand wasn't going to use single-engine, one-pilot aircraft.
"We have a firm view that we only have twin-engine planes and two pilots. We're a network carrier with a strong brand - it's not to say that anyone doing that [single-engine one-pilot flying] is unsafe - it's just a call we make on our brand."
The closure of Eagle comes a year after Air NZ celebrates its 75th anniversary this year and it is a company that partly trades on being deeply embedded in the heartland.
"Ideally we like to keep these ventures," Parton says. "History is important to us but not to a point where you put your larger business at risk by carrying loss-making parts of it."
Parton says business people in the regions are well aware of how tough it is in business outside the main centres.
"People get it. Regional New Zealand is aware of how business works. People understand the rationale. But then there's the sad part - staff."
Hamilton-based Eagle employs around 230 staff .
Most operational staff including engineers, who are being offered new roles in a new operation in Nelson or staying put to do work on bigger turbo prop planes, and pilots will go on to other roles with the airline. Around 20 to 30 management and administration staff would be harder to redeploy, Parton says.
Enter the winners
But just as there have been losers in the cutbacks there are also winners.
Great Barrier Airlines, Chathams Air and Sounds Air took just days to formulate plans to fill the gaps which were then approved by local authorities.
Great Barrier is flying from Auckland to Kaitaia and its chief executive Mark Roberts says its fixed pricing - $180 one-way for adults and $108 for children will be welcomed by the market. By comparison, during Eagle's last full week of flying, fares ranged between $199 to $339.
The airline was buying a $1 million plus Cessna Caravan for the new service.
"We're confident we can make it viable because it's a very economical aircraft to run - we don't have the same sort of infrastructure costs that Air New Zealand have."
Great Barrier already flew in the north on contract to fly medical staff to Kaitaia from Whangarei.
When Air NZ chief executive Christopher Luxon announced it was quitting the three towns he promised his airline would make usually tightly held commercial information on passenger numbers and yields available to second-tier carriers.
"We found it useful, we would be very happy if we get the same loads that they did and our analysis shows that we can make a profit on half the loads they got," Roberts says.
But that's where the help ran out.
Roberts says the extra capacity into Kerikeri on larger Air NZ planes will provide very strong competition and the lack of an interline agreement - where passengers and their bags can be booked and travel as seamlessly as possible between different airlines - is irritating.
Air Chathams is running the Whakatane to Auckland service and managing director Craig Emeny said the company viewed it as a great opportunity to expand upon its current scheduled services between the Chatham Islands and Auckland, Wellington and Christchurch.
He says Air New Zealand answered all the questions about the commercial viability of the service.
"This route has enjoyed solid loadings for many years and, for the most part, the services which have been timed to meet business travellers' needs have been close to full."
The smaller Metro aircraft would be used if the numbers didn't eventuate. "We're going into it with our eyes open. We think we can provide a better personalised service into Whakatane."
Whakatane mayor Tony Bonne is still steamed up about Air New Zealand.
"They bought out all the second-tier airlines years ago and got the monopoly but now they're pulling back. I think people are still going to vote with their feet, they are still angry about what Air NZ has done."
"We know our place"
Sounds Air will fly between Westport and Wellington and is getting help from Development West Coast to pay for one of its two Pilatus 12-seater aircraft. The Swiss-made single-engine aircraft is very fast and has been used by the Australian Royal Flying Doctor service. Each will cost $2.5 million and will have new engines fitted.
Managing director Andrew Crawford says he's confident of the long-term future of the service based on the numbers Air NZ had provided.
Booking momentum was building although around 21 per cent of passengers booked within 24 hours of flying.
The figures provided by Air NZ proved the market was there.
"We know the numbers, we know the route because our base is Wellington. It's not a huge punt," Crawford says.
Expansion is not stopping at Westport. Yesterday it announced it is introducing daily flights between Wellington to Taupo.
With existing routes to Wanganui, Blenheim, Nelson, Picton and Paraparaumu the airline will deliver 100,000 seats a year of regional air capacity.
Sounds Air is also scoping linking the wine-growing regions Blenheim and Hawkes Bay.
"We're seeing the possibilities. We're not there trying to compete with Air New Zealand - we know our place in life."
Crawford says his airline has lived without an interline agreement with Air New Zealand for years, but still wants one.
Parton is not offering encouragement on prospects of interline agreements.
"They can't give guarantees around two pilots two engines - we say, 'We wish you well but we don't want people who are flying on your aircraft to think they are flying on Air New Zealand aircraft', they are not."
Coming full circle
The flip side for closing Eagle is more capacity on Air NZ's remaining provincial routes and a pledge to reduce fares by an average of 15 per cent.
Twelve centres: Kerikeri, Whangarei, Tauranga, Hamilton, Rotorua, Gisborne, Taupo, Wanganui, Palmerston North, Blenheim, Hokitika and Timaru. Each will progressively move to 50-seat Q300 aircraft and with more larger ATR planes entering the fleet regional capacity in the coming financial year would increase by around 30 per cent.
Gisborne mayor Meng Foon said extra capacity was welcome but his city would like to retain the frequency provided by the Beechcraft.
Steve Lowe runs a website which covers in detail second-tier airlines. He says their rise to fill the Eagle routes is part of the natural cycle of aviation.
"They've come full circle. Air New Zealand doesn't want to be doing the rats and mice provincial stuff - small operators can do it better with the right equipment," Lowe says.
"I think it's the best option for these towns and I think it's just the beginning of it - there'll be other centres that will follow."
But Parton says Air NZ is committed to the centres where it is putting in bigger planes. "We make those investment decisions with caution."
And of the future of those filling the gap?
"If they're still there in two or three years doing a good service then good on them for doing that. That part of the market is tough but we wish them well."