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Air NZ freezes executive pay as costs rise, demand ebbs

Thursday 10th July 2008

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Air New Zealand, the national airline, imposed a freeze on executive pay as part of efforts to curb costs amid soaring prices for jet fuel and waning demand for travel.

Chief executive Rob Fyfe announced the move in a message to staff. The airline is facing one of its most-challenging periods as weakening economic growth saps consumer demand worldwide, he said. The freeze on senior management salaries was confirmed by a spokeswoman for the airline.

The price of jet fuel has soared more than 80% in the past year as crude oil rose to a record.

Air New Zealand stock last traded unchanged at NZ$1.10, having declined from more than NZ$2.60 in the past 12 months.

Air New Zealand raised airfares for the fourth time this year last week. In May, it said full-year profit may fall, reflecting increased costs.

By Jonathan Underhill

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