Form today's press
Australia's Virgin Blue says it will spend up to $A20 million ($NZ23.3m) expanding its network, including New Zealand domestic flights, this year.
The airline's offshoot, Pacific Blue, began flying on the New Zealand main trunk route in November with two Boeing 737-800 jets. It has been flying on the Tasman since 2004.
In November, the airline said it would add a third Boeing to the domestic fleet in April when more planes were delivered.
"The continued investment in new initiatives including further expansion in the New Zealand domestic market is likely to incur a further $A20m in one-off development costs in this financial year," the airline said yesterday, in releasing its interim result.
Australia's No. 2 airline said its net profit fell 8.8 per cent to $A113.3m, from the 2006 December half. Record fuel costs and aggressive competition hit earnings. It predicted a tough year lay ahead.
"There is not a lot of appetite out there for people to pay any more for tickets at the moment, because of the capacity that is there," chief executive Brett Godfrey said.
A detailed review had been started by the board to consider options to enhance shareholder value, Virgin Blue said. It was also "assessing a number of expressions of interest".
Godfrey would not specify if this involved Virgin Blue selling some assets or airlines, or a potential bid for the group.
Majority owner Toll Holdings was seeking a buyer for its stake and is due to report its results today.
Virgin Blue said it had ordered four more Embraer 190 E-Jets and converted another three purchase rights to options for the same model.
The order takes the total number of Embraer regional jets to 24, including 18 of the 104-seat E-190s and six of the smaller E-170 model, three of which are already in service in Australia.
At the time of the launching the New Zealand domestic service Godfrey suggested the Embraers could also be used on regional routes here.
Could virgin be sending Emb-190s our way? If so I think it highly likely that Air NZ will give the Emb-190 the nod over the Q400.