Boeing delays push Air New Zealand B787 deliveries back

By Andrew Curran.

Manufacturing delays at Boeing have pushed the delivery of the first of ten B787 aircraft due to Air New Zealand into the next financial year. The Kiwi carrier confirmed the delay during a June 30 analyst briefing.

“Due to manufacturing delays, our first two new B787-9 deliveries have been pushed further into the first half of FY27,” said CFO Richard Thomson.

Air New Zealand had expected the first B787-9s to arrive before the end of the current financial year, which ends today (June 30).

However, neither Thomson nor CEO Nikhil Ravishankar appeared unduly concerned by the delay.

“Air New Zealand has been through a period of significant operational and financial pressure,” Ravishankar told analysts and media during the briefing.

Multiple factors have weighed on the airline in recent years, including having a large proportion of its existing A321neo and B787-9 fleet out of service for extended periods because of engine manufacturing issues.

Engine issues resolving

At the peak of the problem, five of Air New Zealand’s B787-9s and six of its A321neos were grounded simultaneously.

Now, all the B787-9s and all but two A321neos have received replacement engines, allowing the aircraft to return to service. That is helping resolve long-running capacity constraints and enabling Air New Zealand to better match aircraft types to individual markets.

“Our teams have worked tirelessly and have been instrumental in working with Rolls-Royce and Pratt & Whitney on the early return of engines,” said Ravishankar. “Returning aircraft will help restore scale and improve unit economics as the grounded aircraft return to service.”

Thomson said not being able to deploy the airline’s fleet as planned had been a challenge for the past three years.

“When an airline can't fly the aircraft it owns, the economics deteriorate quickly,” he said. “Aircraft, people, facilities and systems all carry a large fixed-cost element, and if we can't deploy the fleet as planned, we lose utilisation, revenue opportunities and schedule resilience, while disruption and recovery costs rise.”

The CFO said the delayed delivery of the new B787-9s would have a “concertina effect” on the airline’s capital expenditure profile during the new financial year.

“We're working actively with Boeing to re-phase the delivery stream,” Thomson said, adding that the revised fleet delivery plan had yet to be finalised.

Air New Zealand has five B787-9s and five B787-10s on order, with deliveries scheduled through to 2030.

“The big improvement in the aircraft-on-ground position offers some more flexibility to think carefully about the timing of future deliveries and the shape of the capacity growth profile,” Thomson added.

Air New Zealand's strategic reset

The pair used the briefing to launch Air New Zealand’s new strategic reset, Te Pae Hou – Our Future.

“While we cannot control fuel markets, engine supply chains or the broader economy, we can control how we build a more reliable and punctual airline, which customer segments and markets we prioritise, how we allocate capacity and capital, and how disciplined we are on cost,” said Ravishankar.

The reset is built around three priorities: putting the customer first, pursuing targeted growth rather than growth for growth’s sake, and transforming the cost base to create a resilient and future-fit airline.

“We are focused on unwinding inefficiencies and exiting the temporary costs over the next two years,” said the CEO.

“We're looking forward to our new aircraft deliveries, including 787s on long-haul routes and A321s on short-haul and domestic services, which will further improve our operating economics.”

Photo: AI-Generated.

Contact the writer: andrew@aerosouthpacific.com