That international holiday just keeps getting further and further out of reach. Air New Zealand has announced plans to raise airfares again, because of the continued rise in the price of jet fuel, now over US$170 a barrel.
Air NZ's domestic and trans-Tasman fares will increase by around 3%, for tickets bought from July the 17th. International fares to the United States, Canada, United Kingdom, and Asia will increase by an average of 5%.
The company says it could no longer continue to absorb the higher cost of fuel. However the airline's rejected the idea of charging passengers for luggage, a proposal being introduced or considered by many international airlines.
The record-high oil prices are also putting the brakes on Air New Zealand's expansion plans. The company had previously planned to launch at least one new route every year, including flying into India, South America, and other destinations in North America.
CEO Rob Fyfe says the new Auckland to Beijing service will begin in August as scheduled, but further routes may have to wait until oil prices come down. Air New Zealand is basing its expansion plans on Boeing's next-generation 787 Dreamliner plane, which is 20% more fuel efficient than current aircraft.
Posted at 8:32 pm