Air New Zealand has refunded around 15,000 customers on compassionate grounds.
The company said they were paying out around $20 million per week on refundable airfares.
But the airline's chief revenue officer said it could not afford to refund all customers, including those who bought non-refundable tickets.
Cam Wallace told the AM Show this morning the airline was trying to balance saving the business with getting money back to customers.
He said the airline accepted that it had not got its communication right on its refunds.
It was beefing up its call centres to speak to more customers.