Why Air New Zealand dropped business class from its A321neo jets

By David Flynn, May 22 2017

Despite early speculation that Air New Zealand might add business class to its forthcoming Airbus A321neo jets, the Kiwi carrier opted to fit economy seats from tip to tail.

The Kiwi carrier had previously flirted with fitting a small business class cabin to the pointy end of the new single-aisle jets to help it better compete against Qantas, which offers business class on all trans-Tasman flights.

According to Air New Zealand CEO Christopher Luxon, the move was driven entirely by economics on the toughly-contested trans-Tasman route which the A320neo and A321neo jets will mostly fly.

"We have 1.3 million Kiwis going to Australia and we have 1.2 million Australians coming to New Zealand," said Luxon, speaking to Australian Business Traveller on the sidelines of an international Star Alliance media briefing in Frankfurt.

"A lot of that is leisure-based travel, it's visiting friends and relatives, and when you do the maths on putting a business class in place it's really a very poor return... you've got to make the real estate on those aircraft work really well."

The A320neo and A321neo fleet will take on daytime duties across the pond while the Boeing 777-300ER and Boeing 787 Dreamliners, with their lie-flat business class seats and premium economy recliners, fill the morning and evening slots desired by business travellers.

"It really becomes a frequency game, " Luxon explains. "We want high-quality product for corporate customers, which we get in the wide-boy Boeings, and we want massive frequency from the narrow-body A320neos and A321neos."

Luxon says the final configuration for the Airbus neo jets hasn't been locked down yet but will include the popular extra-legroom rows at the front of the aircraft.

"We're working through the configuration – the segmented product architecture of our Seats-to-Suit model works very well but we may fiddle around with that a little bit more on the Neos."

Luxon also hinted that Air New Zealand might shuffle its order for the aircraft, which currently sits at 9 of the A320neo planes and 4 of the larger A321neo jets, following the delay on the A321neo from late 2017 to 2018.

"It's a bit of a wait and see... the A320neo is linked a little bit into which order we take them in and the mix of it might change, we’re working through that now."

David Flynn travelled to Frankfurt as a guest of Star Alliance.


David Flynn is the Editor-in-Chief of Executive Traveller and a bit of a travel tragic with a weakness for good coffee, shopping and lychee martinis.

Air New Zealand - Airpoints

21 Jan 2016

Total posts 160

As mentioned previously, they are sticking to the seating arrangement as per existing A320 fleet of '3 aisle 3' configuration for the A321neo's.

Judging from Christopher Luxton comments, that Air NZ is going for the 220 seat configuration for the A321neo's with 76 to 86cm pitch using the new seats. There were discussions of 214 seats with only 9 rows of seats in Zone 1 (between doors 1 and 2) but it seems they going for 10 rows in Zone 1.

It looks like the Zone 1 will have a mixture of 83-86cm pitch, Zone 2 will have a mixture of 76-83cm pitch and Zone 3 will have 76cm pitch seats.

Zone 1 will cater for Works and Works Deluxe passengers and Air NZ FF/Full Economy fares and Air NZ's partners premium customers.

It seems that Zone 2 will cater for Works and Seat Only passengers and Zone 3 will be Seat Only passengers.

The A321neo's are ear marked for services between AKL and SYD, BNE, MEL, ADL, RAR and NAN and seasonal AKL/OOL/CNS with possible services between CHC and MEL and SYD. The A320neo's will operate the remaining international short haul services.

Qantas - Qantas Frequent Flyer

19 Aug 2011

Total posts 155

More fundamentally, most NZ businesses wont pay for TT business class, whereas Australian ones are more likely to do so.  So outbound demand in business class from NZ TT is low, esp outside AKL (although there is a bit from WLG QF takes that quite easily).  Bear in mind that QF does use TT to feed long haul international, so has business class traffic from NZ feeding that (much like EK), whereas the NZ feed to longhaul is all to Auckland on routes all served by widebodies.

Air New Zealand - Airpoints

21 Jan 2016

Total posts 160

Yes, you are correct.

Air New Zealand - Airpoints

24 Jan 2013

Total posts 30

my former employer pays for PE and what choice do I have from wlg?? most of us in that boat would be happy to stump the diff ..just a thought 
As someone that used the A320 business class many times back in the day to see friends and family in Wellington from my base in Sydney, this is disappointing. It was nice to have a premium option to WLG on the VA/NZ alliance, but alas we're stuck with QF now.

Air New Zealand - Airpoints

24 Jan 2013

Total posts 30

are we also not going to discuss the Pax who fly biz etc to nz and use other exit points such as wlg or chc or zqn and are denied having the seating paid on there all inclusive fare. Thats wrong as i see it. As a wlg pax it is  extremely limited.Lastly why not a biz lite, create the zone from a hard point of view and sell it as such but keeps a lot of people happy,as a pax who rightly or wrongly asbought works deluxe for the workspace the VFM is WOEFUL and io have shelled out numerous times for the privilege . 

I am sorry but i cannot agree that this is the right choice , i get bums on seats on a very competitve market and perhaps i see this through wlg glasses 

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