Air New Zealand expects to boost long-haul seat capacity by 9 per cent in the 2007 financial year as part of network rationalisation that will see it pull out of Singapore in favour of a bigger emphasis on north Asia.

The airline announced yesterday that it would suspend its daily Boeing 777-200ER flights between Auckland and Singapore from October 2 as part of a strategy aimed at replacing unprofitable routes with more lucrative destinations.

Air New Zealand has sustained significant losses on the Singapore route in recent years and said most passengers were connecting to another service, primarily in the northern hemisphere.

It believes most of those destinations can be serviced just as effectively through Hong Kong and the 5 per cent of its passengers travelling to Singapore can be accommodated through code-share deals with its Star Alliance partners.

The Kiwis will start a second daily service to London via Hong Kong in October and says bookings for its new non-stop Shanghai service, due to start November 6, are also strong.

Chief executive Rob Fyfe said north Asian routes were much stronger growth prospects than well-serviced routes in southeast Asia. "The moves we are announcing today are the beginning of a carefully thought-out repositioning process to continue profitably growing Air New Zealand," Mr Fyfe said.

"I am committed to seeing Air New Zealand grow. Air New Zealand will continue to increase its long-haul seat capacity by 9percent in the 2007 financial year and by 6percent in total for the Air New Zealand group."

The route review will also see Air New Zealand's new Boeing 777 aircraft deployed on flights from Auckland to London via Los Angeles, which are now served by Boeing 747-400s.

However, the airline will axe summer season flights from Christchurch to Los Angeles, and Mr Fyfe said it was reviewing the frequency of operations to Tahiti.

The decision to shut down Singapore affects 22 staff based in the city state. The airline said it was investigating alternative employment for them.