News & Thinking
Air New Zealand’s new freight service – a solution?
New airfreight options
With Air New Zealand destined to be providing only domestic passenger services for some time to come (post lockdown), questions have arisen about airfreight since most is carried in the hold of international passenger aircraft. Only two airlines, Qantas and Singapore Airlines, operate dedicated cargo flights in and out of New Zealand.
Rosemarie Dawson, chief executive of the Customs Brokers and Freight Forwarders Federation of New Zealand (CBAFF) recently observed: “Currently air cargo capacity has plummeted and air cargo rates are soaring to unaffordable levels.”
In response, the Government has announced a support package to: “ensure New Zealand’s key air freight channels remain open for high priority goods”.
NZ$600 million has been set aside for the aviation sector, of which up to NZ$330 million will be allocated to:
- ensuring air freight capacity is available on key routes for at least the next six months; and
- dealing with immediate risks and opportunities as they arise in the aviation sector.
Under the air freight capacity support package, airlines and other air freight businesses are able to submit proposals for the Government to provide financial support for them to deliver freight capacity on key routes. The scheme is proposed to run for at least six months.
The Government has fast-tracked up to NZ$1 million to help Air New Zealand move urgent freight to and from New Zealand. Air NZ usually relies on a mix of passenger and air freight revenue to maintain its operations. Minister Twyford noted: “That’s why we agreed to provide variable top-up funding for international air freight movements to make sure the flights are financially viable.”
Air New Zealand has introduced “a range of aircraft charter services covering every port on the Air New Zealand network (excluding London)…[and]…customised options from North American markets through to Australia.” That includes a ‘Multi Party Charter Agreement’ which allows customers to purchase a single airfreight pallet position on a charter flight, or by working together with a Freight Forwarder, a coalition of exporters and importers can potentially combine and consolidate their shipments so that they are able to purchase a single unit on the aircraft.
We have first-hand experience of these new charter services having assisted a client with charter agreements and block space purchase agreements over the last week or so.
New Zealand Trade and Enterprise (NZTE) is working with Air New Zealand, freight forwarders, exporters and government agencies to support additional charter flights. See here for details of charter flight availability arranged by NZTE.
Be prepared for slower deliveries
While we acknowledge and complement Government efforts to buttress air freight availability, shippers should recognise the reality of a need to switch to sea, rather than air cargo, and factor the extra time required into their planning. We understand that international sea freight is operating (broadly) normally, albeit with some delays.