Wirraway
4th Mar 2004, 21:55
Fri "The Australian"
Air NZ to rival Virgin
By Steve Creedy
March 04, 2004
VIRGIN Blue has shrugged off suggestions that its international expansion plans are threatened by an Air New Zealand move to slash Pacific Island fares by an average 25 per cent.
Air NZ has expanded its domestic and trans-Tasman low-fare "Express" model to the Cook Islands, Fiji, Samoa and Tonga.
New one-way Pacific Express fares from Australia to the Pacific destinations range from $380 for Brisbane-Fiji to $748 for Perth-Samoa. The airline hopes to add New Caledonia.
It said more than a third of seats would be in the lowest of four fare categories and available year-round.
The move pre-empts the launch of Pacific Blue services to Fiji and Vanuatu later this year.
But Virgin Blue spokesman David Huttner said he doubted the economics would be as favourable on longer Pacific routes as it had been on short domestic routes.
Air NZ has also suggested it will upgrade the role of low-cost subsidiary Freedom Air in a bid to undercut Virgin in the Pacific.
Meanwhile, Deutsche Bank believes Air NZ remains the most speculative of the Australasian airlines, with risks including the threat of increased competition, stock overhang from the sell-down by Brierley and a possible need for capital for its long-haul products.
Deutsche said the future of the New Zealand Government's 82 per cent shareholding in Air New Zealand was also uncertain.
===========================================
Air NZ to rival Virgin
By Steve Creedy
March 04, 2004
VIRGIN Blue has shrugged off suggestions that its international expansion plans are threatened by an Air New Zealand move to slash Pacific Island fares by an average 25 per cent.
Air NZ has expanded its domestic and trans-Tasman low-fare "Express" model to the Cook Islands, Fiji, Samoa and Tonga.
New one-way Pacific Express fares from Australia to the Pacific destinations range from $380 for Brisbane-Fiji to $748 for Perth-Samoa. The airline hopes to add New Caledonia.
It said more than a third of seats would be in the lowest of four fare categories and available year-round.
The move pre-empts the launch of Pacific Blue services to Fiji and Vanuatu later this year.
But Virgin Blue spokesman David Huttner said he doubted the economics would be as favourable on longer Pacific routes as it had been on short domestic routes.
Air NZ has also suggested it will upgrade the role of low-cost subsidiary Freedom Air in a bid to undercut Virgin in the Pacific.
Meanwhile, Deutsche Bank believes Air NZ remains the most speculative of the Australasian airlines, with risks including the threat of increased competition, stock overhang from the sell-down by Brierley and a possible need for capital for its long-haul products.
Deutsche said the future of the New Zealand Government's 82 per cent shareholding in Air New Zealand was also uncertain.
===========================================