Air Chathams has welcomed Friday’s announcement of a $17.2 million loan from the Government to refinance debt.

Minister for Regional Development Shane Jones and Associate Minister of Transport James Meager announced almost $22 million in loans to three regional airlines.

The other two airlines to benefit are Blenheim-based Sounds Air, which will receive $4.5 million to upgrade its fleet, and Island Air, connecting Tauranga and Motiti Island, which will receive $252,000 for fleet maintenance.

Mr Meager said regional connectivity was vital to New Zealand’s economic and social wellbeing but the industry was under pressure with some crucial routes at risk.

For Air Chathams, the funding comes at a critical time as the airline continues to navigate operational pressures while maintaining essential air services to the communities it serves.

“The loan will play an important role in supporting the continuation and resilience of these services,” said chief executive Duane Emeny.

“Air Chathams’ leadership team will now work through the detail of the loan and carefully consider how best to allocate the funding to maximise its impact.

“The focus will remain firmly on delivering long-term benefits for the regions, ensuring communities stay connected for travel, business, healthcare, and essential services,” he said.

He said this greatly appreciated support acknowledged the long-standing challenges all airlines faced in connecting the regions.

“The current unprecedented high cost of fuel may or may not continue, but even at 2025 levels – when this support was agreed on – regional airlines face systemic issues that we look forward to working on with central and regional government.”

He said further updates would be provided as planning and allocation decisions progressed.