New Zealand's small regional airlines say business is booming despite challenges in the sector. 

Air New Zealand has recently scrapped a number of smaller regional flights. 

But Barrier Air has been adding routes, saying they're observing strong patronage. 

Chief Executive Grant Bacon told Mike Hosking the industry is in poor condition, but they're happy with their performance. 

He says their flights are on average 70% full, with services paying their way for the carrier. 

LISTEN ABOVE