Air New Zealand (NZ, Auckland Int'l) has announced that it will ground its entire fleet of B777s - eight B777-200(ER)s and seven B777-300(ER)s - through at least the end of 2020.

The airline said in an investor updated that it planned to record a non-cash impairment charge related to permanent retirements of some of the B777s during the current financial year, ending in June 2020, amounting to NZD350-450 million New Zealand dollars (USD220-280 million), "which will be partially offset by a reduction in the airline's deferred tax liability". It said that it would provide further details at a later stage.

According to the ch-aviation fleets advanced module, the carrier's B777-200(ER)s are 14.1 years old on average, while the -300(ER)s are 8.1 years old on average. Air New Zealand owns four units of each type. The four remaining -200(ER)s are leased from AerCap, while the -300(ER)s are leased from Air Lease Corporation (two) and Nomura Babcock & Brown (one).

As the B777s remain grounded, Air New Zealand's sole active widebody type will be the B787-9s of which it has 14. The airline also has outstanding orders for eight B787-10s from Boeing.

In terms of other orders, the carrier said it will defer deliveries of some A321-200neo. Air New Zealand said that in total, it planned to reduce capital expenditure by NZD700 million (USD435 million) through the end of 2022.

Air New Zealand has seven A321neo on firm order from Airbus. It already operates seven of the type, using them predominantly on trans-Tasman services to Australia from Auckland Int'l and Christchurch, and on routes to South Pacific islands from Auckland, the ch-aviation schedules module shows.

In terms of its current operations, Air New Zealand said that while it would be restoring more domestic routes to respond to a gradual return in business and leisure demand within the country, it would also extend the temporary minimal international schedule through August 31, 2020.