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Air NZ and Qantas Try Again |
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Written by Air NZ
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Wednesday, 12 April 2006 |
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Air New Zealand
And Qantas Apply To Co-operate On The
Tasman
Air
New Zealand and Qantas today announced they have signed a codeshare
agreement for their Tasman routes. The airlines will shortly file
applications seeking authorisation from the New Zealand Minister of
Transport and the Australian Competition and Consumer Commission.
The agreement, which is subject to an independent audit review, will be
specifically limited to the Tasman only.
 Benefits to the consumer would include better loyalty programme
advantages, a better spread of schedules, better connections to onward
flights and the retention of low fares.
Air New Zealand customers currently have the choice of 134 Tasman
departures per week. Under the proposed codeshare with Qantas this
would increase by 63% to 218 departures.
The codeshare will also have significant benefits for the environment.
Air New Zealand currently uses 1.78 million barrels of fuel a year on
the Tasman. This will be reduced by around 100,000 barrels annually
under the proposed codeshare.
"The Tasman is a fiercely contested market," said Rob Fyfe, Chief
Executive Officer of Air New Zealand. "The number of seats on sale is
greater than the number of passengers carried; in fact the equivalent
of 11 empty A320 aircraft make two return trips per day. To continue
such over capacity in the present environment of high fuel prices would
not only be uneconomic, it would be financially and environmentally
irresponsible."
A codeshare agreement will allow the airlines to reduce cost by
removing some surplus capacity and utilising aircraft more efficiently,
while increasing the number of flights available to each airline's
customers.
Mr Fyfe said that while the proposed codeshare arrangements with Qantas
and recent initiatives designed to remove costs from Tasman operations
would be positive for Air New Zealand, the company would still be well
short of achieving adequate returns on its substantial fleet
investment. Air New Zealand currently has almost a billion dollars
invested in aircraft on the Tasman.
"Once the proposed codeshare arrangements with Qantas become effective,
the market will continue to be highly competitive," said Mr Fyfe.
"The reality is that both Air New Zealand and Qantas continue to
compete against a significant number of other airlines on the Tasman.
Both airlines would also remain vigorous competitors in marketing and
distribution."
The proposed codeshare will be supported by revenue, pricing and
scheduling arrangements. Once it becomes effective, all revenue earned
by Air New Zealand and Qantas on Tasman routes will be allocated on an
agreed basis. Each carrier will benefit from its own cost reduction
programmes and continue to maintain independent and competitive
relationships with travel agents.
Mr Fyfe said it was expected that the applications could take around
six months to be assessed by regulators on both sides of the Tasman.
The value of the benefit of the codeshare cannot be released for commercial reasons. |
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Last Updated ( Wednesday, 12 April 2006 )
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