Dunedin city leaders have criticised Air New Zealand following the latest reductions in transtasman flights from Dunedin.

But Air New Zealand says, like many airlines around the world, it is in a position of unprecedented slow-down in the demand for travel and the number of flights out of Dunedin was unsustainable.

The Dunedin City Council, the University of Otago and the Chamber of Commerce yesterday expressed dismay on learning Air New Zealand would be reducing, by about a third, its transtasman flights to and from Dunedin International Airport to a schedule more accurately reflecting seasonal demand....