Air New Zealand’s Profit Forecast and Fleet Challenges for 2025
Air New Zealand has provided an updated profit forecast for the first half of the 2025 financial year, highlighting significant challenges due to ongoing engine issues with its aircraft. The Auckland-based airline anticipates a profit before taxation ranging from NZ$120 million to NZ$160 million, a decrease from the NZ$185 million reported in the same period of the previous year. Approximately 16% of the airline’s fleet, including six A320neo family aircraft and four Boeing 787 Dreamliners, is currently grounded. This significant portion of the fleet out of service has led to reduced operational capacity and affected the airline’s profitability.
The airline attributes these groundings to prolonged maintenance cycles and delays in engine repairs, primarily involving Pratt & Whitney geared-fan aero engines on the A320neo family and Rolls-Royce Trent 1000 engines on the Boeing 787s. The maintenance issues have been exacerbated by global supply chain disruptions, impacting the availability of spare parts and prolonging the duration aircraft spend out of service.
Impact on Travel Sectors and Future Outlook
Domestic travel within New Zealand, which constitutes about 65% of Air New Zealand’s total passenger volume, continues to experience soft demand. Despite this, there are signs of recovery in the corporate travel sector, which could bolster the airline’s performance in upcoming quarters. However, travel sponsored by the government remains subdued, adding another layer of complexity to the airline’s recovery efforts.
Air New Zealand is actively seeking solutions to mitigate these challenges, including the potential leasing of additional aircraft to boost capacity as the peak travel season in the southern hemisphere approaches. The airline’s management is in ongoing discussions with engine manufacturers and exploring all available options to expedite repairs and return aircraft to service. Nonetheless, they do not anticipate a resolution to these engine availability issues until early 2026.
Broader Industry Challenges
This situation is not unique to Air New Zealand. Other airlines globally are facing similar challenges with the Rolls-Royce Trent 1000 engines, affecting their operational capabilities. For instance, British Airways has had to adjust its 2025 flight schedule by reducing frequencies, cancelling some routes, and postponing the launch of new services. Similarly, Virgin Atlantic has delayed its planned services to Tel Aviv and Accra until late 2025 due to difficulties in obtaining spare parts for these engines.
These widespread issues highlight the broader challenges in the aviation industry, particularly in the post-pandemic era where supply chain disruptions continue to impact airline operations worldwide. The delays in engine maintenance and parts availability are creating significant operational hurdles and financial strains for carriers striving to recover and expand their services.