2025 Will Be Tough For Air New Zealand

After Air New Zealand’s most recent financial results were revealed, the next 12 months and thus into 2025 are expected to present challenges.

One of the standouts of the New Zealand flag carrier’s performance was the considerable drop in annual profit, which was 61% lower year over year.

Before-tax, earnings stood at USD 138.5 million, down hundreds of millions; this shouldn’t be a shock.

Air New Zealand has been cited several times, stating that it expects its results to be below what they should be for many reasons.

Most notably, the airline has looked towards the Pratt & Whitney engine saga, which doesn’t represent the first engine crisis to impact the company in the last ten years, the first being the Trent 1000s on the Boeing 787 Fleet.

As part of this, the airline has been negatively impacted by the requirement that engines be either inspected or shipped back to other countries for necessary repairs. Delays surrounding this have left aircraft grounded.

Air New Zealand says that this has had a massive effect on its overall ability to operate successfully in 2024 and will likely continue into the future.

Another avenue that has long been documented is the increasing levels of competition across the markets that the flag carrier serves.

Air New Zealand faces a lot of competition from the North American market, with the carrier stating that expansion from the likes of United Airlines, among others, has impacted its ability to see strong load factors and performance.

Inflation has also been another avenue of concern for Air New Zealand, as navigating the complexities related to this has proved to be a challenge at different times.

However, looking ahead into 2025, the challenges are very much expected to continue, especially considering Air New Zealand believes the first half of the most recent financial year was strong. However, performance collapsed across the second half.

Internally, and more focusing on the domestic network, Air New Zealand stated it has also experienced challenges in its ability to serve business travellers, with some weakened demand on this front.

While 2025 will have its challenges, Air New Zealand states it still has a robust balance sheet and believes it’ll be able to navigate the headwinds that have been threatening the company recently.

Decisions, for example, to lease aircraft such as the Boeing 777 are what it calls part of an intent to mitigate capacity loss and commit to its customers, showcasing a true intent to aid customers in their travels.

Despite this, the airline still believes 2025 will be tough, and it hopes that things will slowly but surely improve.