“Clearly this is a setback for the team at such an important time of the campaign,” Team NZ chief executive Grant Dalton said.
“These are the moments that can define an America’s Cup campaign, and we have an amazing group of dedicated and talented people who will be working around the clock on getting the boat repaired.
“We will not be sailing tomorrow at least, and will provide further updates on the outlook in due course.”
It was an unfortunate end to a day that went well for the defender on the water, beating Luna Rossa Prada Pirelli in their match race by 12 seconds.
Team NZ were scheduled to compete in two races on the second day of the Louis Vuitton Cup, against Ineos Britannia and Orient Express Racing Team - two teams who claimed wins on day one of the competition.
French entry Orient Express were the first team on the board when they beat Switzerland’s Alinghi Red Bull Racing, capitalising on a great start and sailing well to claim a 24sec win. British challenger Ineos Britannia was rather gifted a win when American Magic made a mistake and came off their foils in the tricky conditions in the starting box.
That gave Ineos Britannia a free run to the starting line and set them up for a 14sec win.
Luna Rossa also got on the board, beating Orient Express by 1min24sec in the final race of the day.
Christopher Reive joined the Herald sports team in 2017, bringing the same versatility to his coverage as he does to his sports viewing habits.