'Devastated' Sounds Air to axe two routes, sell some aircraft

Regional airline Sounds Air will sell five aircraft and cut two routes from September, blaming rising costs and a "deadlock" over provincial air services.

The carrier confirmed it would axe its Blenheim to Christchurch and Christchurch to Wānaka services from September 28, reverting to what it calls a "back to the future" model squarely focused on Cook Strait crossings.

The airline will expand its Cessna Caravan fleet for shorter sectors while seeking buyers for five larger Pilatus aircraft, in order to help "rebuild the viability of the business".

Sounds Air managing director Andrew Crawford said the airline's hand had been forced.

"We are truly devastated that we have been forced into this position after five years of fighting for a solution," he said in a statement.

"It will mean the loss of a number our dedicated and skilled staff, but we are also hugely disappointed for our incredibly loyal customer base who rely on us to get around New Zealand - not only for tourism and leisure purposes but also for regional access to critical healthcare, higher education, and to do business that contributes to regional economies."

Sounds Air and other carriers, including Air Chathams, wanted the Government to step in and called for a concessionary loan scheme, 1News reported last month. The firm had already withdrawn Wellington to Taupō and Wellington to Westport routes in December.

Crawford said the company had been fighting rising costs that threatened regional aviation, and that it faced a "deadlock" between government and private capital markets.

"We are not alone in this, Air New Zealand and other regional carriers in New Zealand, and worldwide, have been hit by the same cost increases, and the irony is that our passenger demand has never been stronger," he said in a statement.

"Government appears to believe that private capital markets will step in to sort this out, while on the other hand, private capital markets believe that government should step in to level the playing field like they do in other parts of the world, in order to maintain essential regional air services."

Sounds Air will continue operating its core Cook Strait routes including Wellington to Blenheim, Wellington to Nelson, Wellington to Picton, Blenheim to Paraparaumu and Nelson to Paraparaumu.

Associate Transport Minister James Meager has been approached for comment.