Aviation Financial Mngmt Course Work

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  LONDON METROPOLITAN UNIVERSITY  CA2010C Aviation Financial Management  Page 1 COURSEWORK (REPORT)   By  Nikola Georgiev Student ID: 07059973Email: nik_singerstr@yahoo.com O P E R A T I O N S  LONDON METROPOLITAN UNIVERSITY  CA2010C Aviation Financial Management  Page 2 Introduction  The following report evaluates the operational activities of Air New Zealand. Air NewZealand is the national carrier of New Zealand and is part of the Star Alliance Group.Detailed examination of the company financial position have been reviewed, as well as keyoperational activities examined, such as routes evaluation, passenger load factors,employees productivity, operational statistics, operating fleet, company strategy, etc.Competitor performance analyzes has been compared, followed by conclusion. Route Structure  Air New Zealand has its route structure divided into domestic and international flights(http://www.airnewzealand.co.nz/).There are over 550 flights per day to 27 domestic destinations  – more than any other airline.The routes include the following cities:Kaitaia, Kerikeri, Whangarei, Auckland, Tauranga, Whakatane, Rotorua, Hamilton, Gisborne,Taupo, Napier, New Plymouth, Wanganui, Palmerston North, Masterton, Wellington, Nelson,Blenheim, Westport, Hokitika, Christchurch, Timaru, Oamaru, Wanaka, Queenstown,Dunedin, Invercargill;The international flights of the airline are divided into three geographical parts  – Europe, Asia& Australasia and the Americas.Air New Zealand operates direct flight on its own to London, but uses code shareflights with its partners to other European destinations (mainly UK, Ireland and Germany),such as Manchester, Edinburgh, Glasgow, Dublin, Belfast, Amsterdam, Brussels, Vienna,Munich, Frankfurt, Dusseldorf, Berlin, Hamburg;Australasia part of the world is again served directly by Air New Zealand and its codeshare partners. Destinations include Sydney, Brisbane, Gold Coast, Melbourne, Adelaide,Perth, Cairns in Australia, Tokyo, Osaka, Shanghai, and the new route - Beijing in Japan(including other internal locations served by partners of the airline), Tonga, Norfolk Islandand others.North American region is served by Air New Zealand with direct flights to LosAngeles and San Francisco, USA and the new route - Vancouver, Canada, although manymore cities including New York, Washington, Chicago and Mexico are served by the airlinecode share partners.  LONDON METROPOLITAN UNIVERSITY  CA2010C Aviation Financial Management  Page 3 The performance on the routes is divided into domestic, long haul and Tasman &Pacific Island flights and is observed as follows:Long haul flights load factor has increased over 80%, with passenger numbers up by12.3%. Air New Zealand route performance has shown great results, which enabled thecompany to launch new direct services to Vancouver, Canada and Beijing, China. BusinessPremier and Pacific Premium Economy sub classes show good performance. The newservices provided by the airline include gate-to-gate in-flight entertainment and concierge.The company continues the optimisation of its long haul network.Domestic flights capacity has increased by 7.5% compared with the preceding year,although the load factor decreased by 0.7%. The airline operates more domestic routes thanany other airline, which leaded to increase of passenger numbers by 6.1%. Five more Q300turbo props have been added to the fleet. Air New Zealand has introduced to its domesticpassengers Koru Hour and Space + seats.Tasman and Pacific Island flights capacity have been decreased by 1.9%, but loadfactor have been increased by 2.7%. Air New Zealand has started a huge investment intoupgrading of the inflight entertainment system. The airline merged with Freedom Air.In general for all routes of the airline, the capacity have increased by 5.4%, while thepassenger load factor have increased by 2.8%, with hugely increased competition on thedomestic market. Flights Performance   The following table shows 20 of the most active routes for the airline based on thenumber of observations made in the time period June 2007  – June 2008. Departure Arrival # Flights On-time Delay Cancelled DivertedCode City Code City Rating Operated Codeshare % Avg Max Flights Flights AKL AucklandWLG Wellington (3,8)975 0 85% 12 178 4 0% 0 0%WLG WellingtonAKL Auckland (4,2)903 0 88% 11 174 6 0% 0 0%CHC ChristchurchAKL Auckland (4,3)826 0 88% 11 147 5 0% 0 0%  LONDON METROPOLITAN UNIVERSITY  CA2010C Aviation Financial Management  Page 4 AKL AucklandCHC Christchurch (3,8)805 0 86% 12 198 8 0% 0 0%SYD SydneyAKL Auckland (2,5)226 0 76% 18 195 8 3% 0 0%AKL AucklandSYD Sydney (2,4)223 0 71% 16 140 6 2% 0 0%AKL AucklandZQN Queenstown (4,5)153 0 93% 11 162 0 0% 0 0%ZQN QueenstownAKL Auckland (3,8)152 0 85% 14 235 1 0% 0 0%BNE BrisbaneAKL Auckland (3,7)144 0 94% 25 179 0 0% 0 0%AKL AucklandBNE Brisbane (3,1)138 0 81% 17 170 0 0% 0 0%AKL AucklandMEL Melbourne (1,6)108 0 56% 19 129 0 0% 0 0%MEL MelbourneAKL Auckland (2,7)107 0 82% 17 113 0 0% 0 0%AKL AucklandLAX Los Angeles (3,0)103 0 80% 15 74 0 0% 0 0%SYD SydneyCHC Christchurch (1,9)92 0 83% 34 279 1 1% 0 0%DUD DunedinAKL Auckland (3,3)88 0 79% 15 159 0 0% 0 0%AKL AucklandDUD Dunedin (3,6)86 0 93% 18 93 0 0% 0 0%CHC ChristchurchSYD Sydney (4,2)81 0 91% 15 115 1 1% 0 0%NAN NadiAKL Auckland (1,8)67 0 76% 23 94 0 0% 0 0%AKL AucklandNAN Nadi (2,1)67 0 77% 24 101 0 0% 0 0%
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