Latest / Best of Business / Cath O'Brien: Board of Airline Representatives NZ executive director on the growing concerns around the fuel shortage

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Cath O'Brien: Board of Airline Representatives NZ executive director on the growing concerns around the fuel shortage · Best of Business

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  Speaker 2: Airlines have apparently changed now how they're viewing the fuel crisis.
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  Speaker 2: It's no longer a short term problem as far as
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  Speaker 2: they're concerned. It is now long term. Gather run from
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  Speaker 2: the Board of Airline Representatives is with us, Hikath, you're ahead.
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  Speaker 2: So what does that mean in practice?
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  Speaker 3: Like I think in practice, you know, airlines have to
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  Speaker 3: plan for the future, and an airlines plan actually in
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  Speaker 3: two seasons of the year, and at the moment we're
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  Speaker 3: planning for the season that runs October to March, and
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  Speaker 3: so as we plan ahead for that season, we have
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  Speaker 3: to plan networks on a totally changed basis of cost.
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  Speaker 3: And I think that's the real challenge, which means.
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  Speaker 2: That once the flight schedules come out for that period
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  Speaker 2: from October onwards, we should see what reduced flights higher prices.
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  Speaker 3: Well, yeah, I mean is a mix of those things probably,
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  Speaker 3: I think, you know, airlines have to think about the
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  Speaker 3: cost to operate the route, which is now different. We
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  Speaker 3: have to think about whether people are going to want
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  Speaker 3: to travel and from where to where they might want
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  Speaker 3: to travel, We're going to have to think about how
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  Speaker 3: we can best utilize aircraft in that scenario, So how
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  Speaker 3: we can keep the aircraft essentially flying as much as
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  Speaker 3: possible because that makes the best return. And you know,
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  Speaker 3: it is difficult with a huge volatility that we're seeing
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  Speaker 3: in the world, which is resulting in sort of you know,
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  Speaker 3: physical changes to fuel provision, to different geopolitics, to various
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  Speaker 3: restrictions potentially. You know, it's a very volatile environment in
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  Speaker 3: which to make those very careful plans.
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  Speaker 2: Okay, so do you think that there will be international
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  Speaker 2: flights that will be cut to or from New Zealand?
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  Speaker 3: I don't know, And I think that when I look
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  Speaker 3: at when I look at New Zealand, we are a
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  Speaker 3: small market in the world, and we have a lot
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  Speaker 3: of long haul connectivity that connects us up. A lot
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  Speaker 3: of it is connecting us. All of that is connecting
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  Speaker 3: us from our small market to the larger markets offshore.
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  Speaker 3: So we operate these long skinny roots, and long skinny
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  Speaker 3: roots just are already the most expensive routes to operate anyway,
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  Speaker 3: and so now they are even more so because of
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  Speaker 3: course that feel that you need to fly that very
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  Speaker 3: long way now costs you a lot more, and so
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  Speaker 3: those passengers on that aircraft have to make that work,
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  Speaker 3: and they'll come a point that it may not. And
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  Speaker 3: so I think long, skinny roots connecting small markets to
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  Speaker 3: large markets are sort of logically the most at risk
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  Speaker 3: in a high cost environment.
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  Speaker 2: Not sounding good, Okay, Thank you very much appreciated, Catho,
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  Speaker 2: Brian Border Airlines representatives.
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