Fri "The Australian"
Kiwi fare game for our fliers
By Steve Creedy
August 15, 2003
AIR NEW Zealand's website is running hot as Australians looking to take advantage of trans-Tasman fare cuts of up to 36 per cent book flights at up to seven times previous record levels.
The Kiwi carrier this week unveiled everyday low-cost fares to New Zealand starting from $243 one-way as part of a pared back "Tasman Express" service.
It expects the move to boost its traffic across the Tasman by 10 per cent over the next year.
"Our internet bookings on the first day increased sixfold over the previous highest level, and on day two they climbed to a sevenfold increase, as passengers and travel agents embraced online bookings," said Air NZ vice-president Australia Paul Donovan.
"The Tasman is an extremely competitive market, and for Air New Zealand an extremely important market.
"We see the strong and very positive response to Tasman Express as an endorsement not only of our new fares policy but of our total product between Australia and New Zealand, and of our strategy for this market going forward."
Air NZ is not expected to have the market to itself for long, with both Virgin Blue and Qantas promising to remain competitive.
The cheap fares will be permanently available on a quarter of all the airline's trans-Tasman seats and up to a 40 per cent on some routes.
Business-class fares have been reduced by an average of 26 per cent.
Tasman Express begins on October 29 and retains two classes with inflight entertainment and a more basic food service.
Economy fares have been simplified to three tiers, but will now attract a $20 "user pays" booking fee per one-way sector if booked through Air NZ call or travel centres.
Booking via the Web is free, but travel agents will also have the option of applying the fee.
As well as the non-refundable Smart Saver fare, the airline is offering a mid-range economy fare with the flexibility to change flights for a fee of $100.
The new fares apply to routes between more than 20 New Zealand destinations and Sydney, Melbourne, Brisbane, Cairns and Perth.
Norm Thompson, Air NZ's senior vice-president sales and distribution, said the new fares were possible because of fundamental changes to the airline's trans-Tasman business model, including the introduction of more cost-efficient A320 aircraft.
Air New Zealand carried 11 per cent of all passengers into Australia in the year to March, 2003, and the new fares were welcomed as a win for tourism in both countries.
TTF Australia chairman Les Cassar said the move reduced trans-Tasman airfares by an average of 20 per cent when business fares were included.
===========================================