June 4, 2018 / 2:53 AM / 6 months ago

Air NZ to lease two Boeing 777s to cover for 787s with Rolls-Royce engine problems

An Air New Zealand Boeing 777-300ER plane taxis after landing at Kingsford Smith International Airport in Sydney, Australia, February 22, 2018. REUTERS/Daniel Munoz

SYDNEY (Reuters) - Air New Zealand Ltd (AIR.NZ) will lease two Boeing Co (BA.N) 777s to cover for 787-9s with Rolls-Royce Holdings Plc (RR.L) engines that have maintenance issues, its chief executive said.

The compressor in the Trent 1000 package C engines is not lasting as long as expected, requiring inspections and forcing airlines to ground aircraft while the checks take place.

“Any one point in time we are planning to have between zero to two aircraft that will be cycling off to have aircraft inspections and/or maintenance,” CEO Christopher Luxon told Reuters on the sidelines of an airline industry conference.

“Therefore we will have two dry-lease aircraft we can operate so we can restore the schedule and keep our customers moving,” he said on Monday.

He said one dry lease, which does not include crew, has been signed and another should be agreed soon. Air New Zealand is also examining the purchase of future long-haul aircraft to replace its fleet of eight ageing Boeing 777-200s. A request for proposal should be issued in March-April next year, with deliveries expected from 2022, Luxon said. Air New Zealand is considering the Airbus SE (AIR.PA) A350 as well as the Boeing 777X and 787-10 models, he said, with the aim of launching longer routes like Auckland-New York and Auckland-Brazil. Luxon also said international yields, a proxy for airfares, were rising as the airline looks to recover increased fuel costs. The airline recently raised domestic ticket prices by 5 percent due to rising costs.

Reporting by Jamie Freed; Editing by Himani Sarkar

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