New Air New Zealand CEO Nikhil Ravishankar has made it clear that travelers shouldn’t expect lower airfares in the near future, as the airline faces rising operational costs and industry-wide financial pressures. Barely a week into his new role, Ravishankar emphasized that while Air NZ remains committed to connecting regional communities, maintaining affordability will be a challenge due to increasing expenses across the aviation sector.
Rising Aviation Costs Pose Major Challenge
According to Nikhil Ravishankar, aviation system costs — including airport landing fees, Civil Aviation Authority levies, and Aviation Security Services — have surged by an astonishing 76%. These rising costs have placed immense pressure on the airline’s ability to maintain competitive pricing, particularly for domestic and regional routes.
He explained that Air NZ’s competitors often avoid less profitable regional destinations, but the company remains dedicated to keeping those communities connected. “Our relationship with the regions isn’t transactional,” Ravishankar said, underscoring Air NZ’s commitment to accessibility and service sustainability.
However, he admitted that the airline must explore new ways to make these routes financially viable. “Subsidies are just one lever to pull,” he said, noting that ongoing discussions about how to sustain regional operations would continue in the coming months.
Fare Prices and the Supply-Demand Equation
When questioned about high airfares — particularly last-minute bookings — Ravishankar described it as a supply-demand management issue. He revealed that Air NZ already implements price caps on certain routes to ensure last-minute tickets remain affordable.
“In a lot of situations, we price cap to make sure that, even for those last-minute seats, they remain affordable,” he said. “But if costs grow faster than we can recover, then we’ll have a longer-term challenge that we’ll have to manage.”
This statement signals that while Air NZ is trying to cushion the impact on consumers, the company cannot absorb escalating costs indefinitely without affecting profitability.
Focus on Sustainability and Future Strategy
Ravishankar’s comments also indicate a broader focus on sustainability and long-term operational balance. The new CEO suggested that the airline’s regional routes would require creative solutions — beyond government subsidies — to ensure their continuity and affordability.
He emphasized that maintaining strong regional links remains a top priority for Air NZ, both economically and socially, as these routes play a vital role in the country’s connectivity and tourism sectors.
A New Era for Air New Zealand
Ravishankar’s appointment follows the tenure of Greg Foran, who led the airline through the challenging post-pandemic years. As Air NZ navigates recovery and restructuring, Ravishankar’s leadership marks a new phase centered on modernization, sustainability, and customer trust.
The CEO’s early communication reflects transparency and realism — acknowledging the financial headwinds while reassuring passengers that Air NZ remains committed to serving New Zealand communities with reliability and integrity.
What It Means for Travelers
For now, passengers planning domestic or regional trips should brace for continued high ticket prices, especially during peak travel periods or short-notice bookings. However, Ravishankar’s assurance that Air NZ will maintain affordability caps provides some relief to frequent flyers.
Air NZ’s future pricing and sustainability strategies are expected to evolve as the airline adapts to cost pressures, changing demand, and government policy discussions around regional connectivity and carbon neutrality.
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