Air New Zealand is planning to increase the size of its domestic fleet by transferring Airbus A320s from its international operation, and is also considering ordering up to seven additional A321neos to use on domestic routes.

The carrier has revealed it will move three leased A320ceos currently used in the international fleet to domestic services by the end of this year. These aircraft are being replaced by A320neos that are scheduled to be delivered to the international short-haul fleet, Air New Zealand CFO Jeff McDowall said during a briefing for analysts and investors.

Adding the three A320ceos will increase the domestic jet fleet to 20 A320s. The last new domestic jet delivery was in October 2016, and since then the airline has been increasing capacity by improving utilization. The fleet is now stretched about as far as possible, “so to grow further we need more aircraft,” McDowall said.

However, the additional three A320s are aging, and the carrier will look to replace them in the domestic fleet relatively quickly, McDowall said.

Air New Zealand is evaluating whether it will order A321neos in domestic configuration to replace these aircraft by 2020. A321neos may also be used to replace four other domestic A320s when their leases expire in 2022-24.

Air New Zealand already has firm orders for seven A321neos and six A320neos, but these are destined for the international fleet. The carrier would have to place new orders if it decides to add A321neos in domestic configuration. It currently has five options for aircraft from the A320neo family.

The international A321neos will be configured with 214 seats in single-class layout, with the A320neos configured with 165 seats. The A320ceos currently used on international routes have 168 seats.

For the widebody fleet, Air New Zealand is considering what aircraft type it will order to replace its Boeing 777-200ERs. The airline has almost finished evaluating initial information from Airbus and Boeing, and plans to issue a request for proposals (RFP) in July. The RFP process is expected to be completed by April 2019, with the carrier targeting first delivery in late 2022. The options being considered by Air New Zealand include the Boeing 777X, 787 and Airbus A350 families, McDowall said.

In the longer-term, the airline is interested in the development of electric aircraft. These could be suitable for the domestic regional network, Air New Zealand chief strategy-networks and alliances officer Nick Judd said. Most of these routes are relatively short and are currently served by turboprops. Electric aircraft “could become a viable option for us within the next 10 years,” Judd said.

Adrian Schofield,