As airlines gear up for more one-way travel across the Tasman a new survey has good and bad news for the aviation sector which is burning through cash at $450,000 a minute.
From next week Qantas and Jetstar will start 13 flights a week from Auckland and Christchurch and the easing of restrictions means Air New Zealand will also add thousands more seats between now and January.
The removal of quarantine requirements in New South Wales and the Northern Territory from October 16 will dramatically open up options for travel to Australia, although New Zealand's 14-day isolation requirement keeps the brakes on overall travel.
Qantas chief executive Alan Joyce has said the easing
of restrictions was the best news for airlines for months. Qantas this week was reporting steady sales off a low base with most seats one-way to Australia while Flight Centre says website views of New Zealand to Australia flights doubled overnight following the announcement.
Later in October one-way fares from Auckland to Sydney on Qantas
range from $642 to $882 aboard Boeing 737-800s which will return to the route. Seat and bag fares on Air NZ range from $472 to $882 on board Airbus A320s or Boeing 787s.
In the month before travel restrictions were imposed - and as airlines saw the start of what was to be a plunge in demand - Air NZ was offering some promotional one-way fares for as low as $69.
Air New Zealand will increase capacity on its limited Tasman operations by 12,000 seats between now and January.
But another airline, Virgin Australia, says the one-way direction of traffic means it will wait on the sidelines.
''We are commercially reliant on two-way passenger traffic, therefore our approach to reintroducing services between Australia and New Zealand will ultimately be driven by customer demand, said a spokesman.
The airline had about 16 per cent of the market before the pandemic and says it will continue to review its network and reintroduce short-haul international services where demand and border restrictions allowed it to.
Flight Centre's general manager of product, Victoria Courtney, said the Australian announcement was a start.
''It's given the industry and our customers a bit of hope towards further travel bubbles, and it'll be a good test run for future border openings,'' she said.
For those eager to get to Australia, either for emergency situations (bereavement, sick relatives, major events like weddings or births) or even for Kiwis who are Australia-based but have been stuck in New Zealand an increase in flights will be a big help.
"We've seen a small increase in leisure bookings however the managed isolation fee and process on return to New Zealand is understandably a massive deterrent to customers,'' said Courtney.
Prime Minister Jacinda Ardern said this week work on a travel bubble with the Cook Islands was back on.
Courtney said that the desire to travel there is strong, but Kiwis are weary and looking for confirmation from the Government before diving in.
''We have seen some uptake in flexible booking options, as no doubt, when the time comes, the Cook Islands will be the place to be."
Auckland Airport has welcomed the return of Qantas and Jetstar.
''New Zealand and Australia have very strong connections between our people, families, businesses, economies, sporting and culture – any changes made to border restrictions that allow travel and for these broad and important connections to be safely re-established is great to see,'' said Scott Tasker, general manager aeronautical commercial.
He said the airport was also pleased to note that prime ministers of both countries were continuing to discuss and progress towards a future safe travel zone.
''Given the strong ties between our countries, it will be a welcome announcement when our governments determine the time is right.''
Australia is New Zealand's biggest outbound market and last year 1.3 million Kiwis visited the country, spending $2.6 billion. About 444,000 people from New Zealand visited New South Wales.
Willing to fly, but nervous
Aviation consultancy firm OAG today released the results of a global survey which showed 69 per cent of respondents intend flying internationally during te next six months while 79 per cent have plans for domestic air travel.
Globally overall capacity is now running at 46.3 per cent or 50 million seats below that of last year.
While many passengers remain wary of catching Covid-19 while travelling, the overall fear factor (as it relates to catching the virus while at the airport or flying) is with 52 per cent of respondents rating their fear level at five or below on a scale of one to 10.
Travellers are most afraid of catching coronavirus while on the plane (40 per cent), followed by airport terminals (17 per cent). Seventy-six per cent think that requiring all passengers and staff to wear masks is the most effective safety measure for both airlines and airports, followed by improved cleaning procedures.
Nearly a third of travellers have not adjusted their travel habits (and don't plan to) as a result of the virus.
The survey provides further insight into the mindset of those adjusting heir habits.
''There's a segment of the population that's still willing to fly, but taking a more conservative approach: 37 per cent will fly if it's critical 25 per cent will fly directly and avoid using connecting flights and airports and 10 per cent will fly during off-peak times.
More than half of travellers (53 per cent) said it would be valuable to see rates of Covid-19 transmissions at their intended destination when booking.
The survey found Millennials and Generation Z are less likely to adjust their travel plans and behaviour in light of the virus, 66 per cent versus 70 per cent overall).
Burning through the cash
Any further recovery can't come quick enough for airlines.
The International Air Transport Association has warned that the airline industry will burn through US$77 billion ($116b) in cash during the second half of 2020. This is equivalent to US$300,000 per minute, despite the restart of operations.
The slow recovery in air travel will see the airline industry continuing to burn through cash at an average rate of US$5 to $6b per month next year. (From April to June this year, Air New Zealand was burning through NZ$175m a month, due to refunds and redundancy payments, although the airline has forecast this will now halve.)
The association says that despite cutting costs just over 50 per cent during the second quarter, the industry went through US$51b in cash as revenues fell almost 80 per cent compared to the year-ago period.
To date, governments around the world have provided $160b in support, including direct aid, wage subsidies, corporate tax relief, and specific industry tax relief including fuel taxes.
"We are grateful for this support, which is aimed at ensuring that the air transport industry remains viable and ready to reconnect the economies and support millions of jobs in travel and tourism. But the crisis is deeper and longer than any of us could have imagined,''said Alexandre de Juniac, IATA's director general and chief executive.
Airlines in the United States have overnight been dealt a blow by President Donald Trump's announcement he had called off talks with Democrats for a national stimulus package until after the election.
This throws into uncertainty the jobs of tens of thousands of airline workers who have been supported by federal aid.