Air New Zealand is rewarding staff for helping get the airline through covid-19 with $1,000 worth of shares.

“The airline recognises this has been an extraordinarily difficult time for its people, who have worked tirelessly for the past 15 months to keep customers moving and connected to each other,” it said.

It will provide all eligible permanent staff employed by the company as at December 2020 with an award of $1,000 worth of Air New Zealand shares. The shares will be allocated in the fourth quarter of this calendar year.  Air NZ said around 8000 employees will be eligible.

Air NZ shares last traded at $1.62.

The airline is also looking to retain staff.

“Acknowledging that the airline must retain talented people to help the business progress to the thrive phase, the company will also end staff salary reductions from the start of the 2022 financial year.”

The 2022 financial year kicks off on July 1.

 E tū’s head of aviation, Savage, said the move was positive. 

“Air New Zealand’s offer along with other indications is a clear step forward in the airline’s recovery and rebuild. It is in no small way due to the hard work and sacrifices made by aviation workers, who have borne the brunt of much of the upheaval caused by the pandemic," he said.

He noted this has included massive job losses and around 35 aviation workers who contracted covid-19 themselves. 

He also said, however, while the offer is a good start "we need to remember that there are still hundreds of Air New Zealand workers who are only paid the minimum wage."

As a result, "we want to see the company rebuilding as an accredited Living Wage employer."

Domestic at 90% of pre-covid levels

Air NZ said its domestic capacity is now at approximately 90% of pre-covid levels and corporate demand continues to show strong signs of recovery, averaging around 80% of historical levels for the past three months.

Also, the Tasman market is building following the opening of the trans-Tasman bubble in late April 2021, with capacity currently at around 70% of pre-Covid levels.

However, long-haul international passenger travel remains highly restricted, with passenger volumes currently less than 5% of pre-covid levels while international borders remain effectively closed.

Chief executive Greg Foran noted that while demand on the airline’s domestic and short-haul networks is currently showing positive momentum, if there are further border restrictions or lockdowns, there is no certainty this momentum will continue.

Later delivery

Among other things, it recently renegotiated the delivery date of the first of eight new Boeing 787 Dreamliners, which were ordered in 2019 prior to the outbreak of covid-19.

They were due to enter the fleet in the 2023 financial year but will now be delivered in the 2024 financial year.

It reiterated it is targeting to undertake a capital raise before Sept 30, a portion of the proceeds from which will be used to repay any amounts drawn under credit line from the government.

The government’s $1.5 billion credit facility remains in place and Air NZ has still only drawn down $350 million.

The company still expects that losses before other significant items and taxation will not exceed $450m for the 2021 financial year.

Looking ahead, the airline is not expecting any meaningful recovery in long-haul demand in the 2022 financial year, notwithstanding the roll out of global vaccination programmes and the potential for long-haul borders to begin reopening progressively in the second half of the financial year.

The airline currently anticipates a loss before other significant items and taxation in the 2022 financial year comparable with that expected for the 2021 financial year.

However, given the current environment, the outlook for the 2022 financial year remains uncertain, it said.

(Updates to include comment from E tū’s head of aviation)