AIR NEW ZEALAND: Overcomes slot challenges to return daily to London Gatwick from mid 2025

The New Zealand airline abandoned its slots at London Heathrow in 2020, early in the pandemic, by selling them and taking the cash to fix its bottom line. Now that travel is going gangbusters, Air New Zealand wants to return flying to the Old Dart, but the Heathrow slot cupboard is bare. Fortunately, they have secured a daily slot at London’s Gatwick Airport.

Striving for a Heathrow slot

Air New Zealand is determined to reestablish direct service from Auckland to London. Unfortunately, Heathrow is Europe’s busiest airport, with many airlines vying for its limited slots. Despite Air New Zealand’s request for daily slots, the airline has not yet been successful in acquiring them.

Considerations for return to London

The potential reinstatement of the Auckland-London route, spanning approximately 11,405 miles, would be amongst the world’s longest flights. However, Air New Zealand lacks the ultra-long-haul aircraft necessary for the nonstop journey. To achieve the distance nonstop, an aircraft running at less than full capacity would almost certainly make the route uneconomic. The re-introduced service would need an intermediary stop somewhere.

Historically, the airline has operated via Los Angeles and Hong Kong, offering unique fifth-freedom flight experiences. Speculation toys with a possible new stopover in Canada or even Hawaii. Some commentators have suggested mirroring the Qantas via Perth to London route but commencing in Auckland.

Air NZ already runs daily flights between Auckland and Perth using a Boeing 777. Australia and New Zealand have an ‘open skies‘ agreement, although I am not sure that it would extend to a fifth freedom right from Perth.

The Slot Dilemma

The challenge of obtaining Heathrow slots is not new. In 2020, Air New Zealand sold its Heathrow slots for $27 million, a testament to their high value. A few years ago, Oman Air paid $75 million for similar slots, illustrating the fierce competition at Heathrow. Fortunately, Air New Zealand has secured slots at Gatwick.

Should Air NZ return to London?

Returning to the London market would return a European destination to Air New Zealand. The airline must compete with numerous carriers offering direct (but not nonstop) services between New Zealand and the UK, such as Emirates, Qatar Airways, and Singapore Airlines.

It will also be challenging, given Air New Zealand’s aircraft shortage and the operational complexities of a fifth-freedom service. All of that adds layers of complexity to this endeavour.

The profitability and strategic advantage of such a move remains in question.

2PAXfly Takeout

New Zealand settlers from Britain and their descendants (Pākehā) have a natural affinity for England and Scotland. New Zealand is full of British-derived names for towns and regions. Examples are Queen Charlotte Sound, Coromandel Peninsula, Stwart Island, Invercargill, Gisborne, Blenheim, Marlborough, Palmerston, Cromwell and Queenstown.

Back in the 1980s, nearly every 20-something I knew in Australia was either on their way to or just returning from Britain.

I don’t think there is a question about the demand for a route to Britain, and it seems natural for New Zealand’s ‘national’ carrier. The question is whether they can make it economically viable against formidable competition from Asian and Middle Eastern carriers. The route chosen is going to be important in answering that.

Finally, the question of aircraft type and availability will be crucial for a daily route. Air NZ has a fleet of 777-300s and Boeing 787 Dreamliners to service long-haul routes. Fortunately, it is expecting a bunch to arrive in 2025, which might give it the capacity to open this route.

I wonder if this threat to competition on the ‘Kangaroo Route’ is the reason that Qantas has introduced its most recent Frequent Flyer Status Match targetted at Air New Zealand flyers amongst others?