Covid 19 coronavirus: Small NZ airlines hanging by a thread

Air Chathams general manager Duane Emeny. Photo / Jason Oxenham

Small airlines warn they are on the brink of failure and without a relatively small cash injection smaller communities could be left without air links permanently.

The largest of the second and third tier operators, Air Chathams, says the sector needs as little as $10 million in direct government support to tide it over, which it says is a fraction of what has been allowed for Air New Zealand.

And the body representing all airlines operating here says most of the regional domestic carriers are ''hanging by a thread'' and direct financial support is needed.

''A modest injection of funding from government will secure the critical air links they provide to the regions,'' said the Board of Airline Representatives executive director Justin Tighe-Umbers.

This would save not only the airline but jobs and businesses in the communities they serve and support needed to be more than just wage subsidy and tax relief.

The smaller airlines carry more than 300,000 passengers a year from places too small for Air New Zealand. In response to Herald inquiries Transport Minister Phil Twyford said an announcement on what further support to maintain essential aviation services would be made in the ''coming weeks''.

Air Chathams general manager Duane Emeny said his airline had been able to tap into some of the Government's $600m aviation fund for essential freight flights to the Chatham Islands but essentially the airline was in hibernation.

The airline was operating about 115 passenger flights a week before travel restrictions but was now doing just three mainly freight flights between the Chathams and Christchurch, Wellington and Auckland. More than 130 pilots, cabin crew and other staff had taken a pay cut and the family-owned company had also been able to access the wage subsidy.

Other smaller airlines include Sounds Air (which has so far been unable to access the essential freight package), Barrier Air, Fly My Sky, Stewart Island Flights, Air Napier and Golden Bay Air.

''I think the key message really is we're not talking about a lot of money comparatively when you think of Air New Zealand with loans for $900m and the majority of the support that has gone through the aviation package,'' said Emeny.

''When you think about all of the second and third-tier airlines you're probably looking at a figure of no more than $10m that would allow all of those airlines to collectively carry on what they're doing.''

Soft loans for the airlines could allow them to carry on.

Central and local government needed to focus on maintaining air links to smaller centres.

''If they don't do that the cost of re-establishing those links in the future will be significant and probably not even realistic. I would assume if second and third-tier airlines were unable or didn't have the financial confidence to go back to those towns they've flown to previously those areas would not be served, probably permanently,'' Emeny said.

• Covid19.govt.nz: The Government's official Covid-19 advisory website

''We're not Air New Zealand but we're all important - we deliver a service whether it's passengers or freight and I think it's important that the Government is aware of that.''

While not able to disclose the terms of the freight flight support, he said his aircraft were carrying food, medical supplies and Civil Defence to the islands. The crayfish season was just about to start and there were signs of a recovery in the export market to China.

Twyford said smaller airlines played an important role keeping remote communities connected and there was a place for them in New Zealand's future aviation sector.

''While keeping critical freight flowing has been the most urgent consideration through our aviation package, we are also looking at what support is needed to maintain essential aviation services.''