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The Air New Zealand CEO says New Zealand might need to get used to living with Covid-19 if its current elimination strategy doesn’t work, and predicts that the airline industry will not recover from the pandemic for several years.
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Air NZ CEO Greg Foran told Q + A that Covid-19 is a difficult virus to control and that in the future NZ will have to see how to live with it. Source: Q + A
Greg Foran told TVNZ1’s question and answer session this morning that the national airline supports the Government’s phase-out strategy and is doing “everything we can” to help.
“In my opinion, it is clearly a very, very difficult virus to control,” he says.
“Whether or not you are talking about the situation that we find ourselves in with emerging clusters or when we are heading down the road where we start to see infected people again, we may end up in a situation here to try. removing it completely actually becomes nearly impossible. “
If the latter were to happen, Foran says the country may need to learn “very, very carefully” how to handle and live with the virus.
He also predicts that it would take years for the airline industry to return “to some degree of normal flight activity.”
However, he cautions that due to the characteristics of the virus, it was difficult to predict how things would turn out.
Just a few weeks ago, Foran was “reasonably optimistic” about traveling to the Cook Islands and Australia.
“At some point, I’m sure we will get solutions for this, you know, vaccines will be developed. But of course it has not yet been resolved if everyone takes them and how effective they are and the ability to distribute them, ”he says.
But until then, Foran says companies, including Air New Zealand, needed to maintain a high degree of flexibility.
It comes after the airline announced a loss of $ 87 million for fiscal 2020, its first loss in 18 years.
The loss is a stark contrast to the previous year, when the national airline posted profits of $ 387 million and highlights the severe impact of the Covid-19 pandemic on its operations.
Covid-related travel restrictions resulted in a 74 percent drop in passenger revenue from April to the end of June compared to the previous year, leading to operating losses for the airline.
The results come despite Air New Zealand posting a strong interim profit of $ 198 million during the first six months of the financial year.
MANDATORY FACIAL COATINGS IN DRAWINGS
According to the Government’s announcement last week, as of tomorrow, facial coverings will be mandatory in some means of public transport for those over 12 years old, including airplanes.
Foran says he is “absolutely” certain the airline was ready for changes to keep passengers, staff and crew safe, adding that crews had been wearing PPE since March.
“We are well rehearsed in what we have to do.”
He says other safety precautions were also taken, such as social distancing on airplanes.
Earlier this month, Health Minister Chris Hipkins met with the airline to discuss growing concerns about Covid-19 deals for airline crews.
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The minister says he is not 100% convinced that the protocols are as strict as they could be. Source: 1 NEWS
According to Mr. Hipkins, flight crews visiting another country must self-isolate for 48 hours upon return to New Zealand.
The crew is then tested for Covid-19 at the end of the two-day period before they are allowed to return to the community, he said.
He said he would issue an order as health minister that would specify to the public what protocols aircrews must follow.
“The rules are very clear to those who are following them at the moment, but to avoid any public confusion about it, I will issue another [order]. “
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Breakfast host John Campbell challenged Greg Foran on why workers didn’t have to self-quarantine when arriving in New Zealand in some cases. Source: Breakfast
Foran told TVNZ1’s breakfast earlier this month: “No system is completely airtight, but certainly many extenuating circumstances can be implemented that can reduce risk.
“And I think the results that we are seeing from Air New Zealand in recent months (we have not had a Covid case since April) indicate that things are going well.
NO MORE JOB CUTS AT AIR NEW ZEALAND IN THE IMMEDIATE FUTURE
When asked if the 4,000 job loss figure at Air New Zealand could grow, Mr. Foran said there would be no further job cuts in the near future.
However, due to the unpredictability of Covid-19, the company needed to deal with what was immediately in front of it, he says.
He couldn’t rule out job cuts in the distant future, “but right now, there are no immediate plans for anything else.”
‘DEEP’ DISCUSSIONS WITH THE GOVERNMENT ON FINANCING
In March, the Government announced a loan agreement of up to $ 900 million for the next 24 months with Air New Zealand. The loan would be repaid at a commercial rate of seven to nine percent.
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1 NEWS report Katie Bradford explains the 24-month loan of up to $ 900 million. Source: Breakfast
Foran says Air New Zealand is starting to use some of that money, planning to borrow in installments to keep interest payments low.
He says there are ongoing discussions with the government about the airline’s capital structure, which is how a company finances its operations and growth through a combination of debt and equity.
For Air New Zealand, going forward, it was important to determine a capital structure that worked, he says.
Foran also noted that he wanted to increase the company’s investment in digital initiatives to improve business efficiency and the customer experience.
Future decisions on how much more of the loan to get would depend on Air New Zealand’s long-term capital structure, Foran said.
“[There are] there are no decisions at this time, “he said, and the” deep “discussions continued.
He said the government wanted to maintain its position as the majority shareholder of the company. He currently owns 52 percent.
“In terms of how that plays out, that will be part of the discussions that we are having right now. So we just have to wait and see. “
