Air NZ airs no-frills Tasman plan

[Wirraway]

Thurs "Sydney Morning Herald"

Air NZ airs no-frills Tasman plan
July 31 2003
By Scott Rochfort Sydney

Air New Zealand's plans to introduce a no-frills Tasman Express service are well advanced as the airline attempts to head off fresh rivals eyeing the already busy Tasman route.

As Qantas accelerates plans for the launch of its own low-cost Tasman carrier Jet Connect, Air New Zealand chief executive Ralph Norris said yesterday: "In a very short amount of time you will hear an announcement in regard to what Tasman Express will be and what the pricing structure and framework will be."

Pointing to Air New Zealand's recently launched low-cost domestic Express Class service as being "transferable onto our Tasman service", Mr Norris said the airline expected to slash its trans-Tasman costs by double-digit figures.

Mr Norris credited Express Class for the 20 per cent reduction in domestic air fares in New Zealand since last November, which was allied with a 23 per cent pick-up in demand.

With Emirates and possibly Virgin Blue expected to commence flights to New Zealand within the next three months, analysts expect Tasman Express services to start as early as next month, when the first of Air New Zealand's new fleet of Airbus 320s is due for delivery. Air New Zealand said the Airbus would be 15 per cent cheaper to operate than the mix of 767s and 737s it was now using over the Tasman.

It is believed Tasman Express will service all major ports that Air New Zealand now services on both sides of the Tasman.

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[Rich-Fine-Green]

This might be the end of AUD$1900 return tickets to NZ unless you book 2 weeks in advance (or fly Freedom Air).

[Kaptin M]

$1900??

In which class, R-F-G?
The usual EY with QF/ANZ is around $600 AUD, although earlier this year I picked them up for $539.

[Wirraway]

Thurs "Australian Financial Review"

More flights to NZ mean cheap fares
Jul 31
Jane Boyle

Air travellers can look forward to discount fares on trans-Tasman routes towards the end of the year as newcomers, including Virgin Blue and Emirates, prepare to add up to 40 per cent capacity to the market and Air New Zealand launches a Tasman Express service.

Air NZ yesterday warned the extra competition would put fresh pressure on its profits and that should help its bid to convince regulators to drop their veto of its proposed alliance with Qantas.

Virgin Blue this week applied for slots to fly two daily services between Sydney and Auckland and daily services from Brisbane and Melbourne to Auckland during the northern winter. It is also seeking slots to fly daily between Sydney and Wellington and from Brisbane, Sydney and Melbourne to Christchurch.

The low-cost carrier also received official designation this week as an Australian carrier, giving it access to Australia's bilateral rights with other countries.

Air NZ chief executive Ralph Norris said that while fare discounting would stimulate demand, the new services from Virgin Blue, Emirates and others were likely to result in overcapacity on trans-Tasman routes.

"We will obviously see an increase in the number of people flying, but there will be a situation where some carriers are going to lose share," he said.

Mr Norris said that in the past year, Air NZ made its first profit on the Tasman in five years because it cut capacity by 12 per cent. But that profitability was likely to be eroded by the extra competition, which comes as Qantas is expanding its NZ subsidiary Jet Connect to the Tasman to cut costs.

Air NZ will respond later this year with the launch of Tasman Express, which Mr Norris said would use new A320 jets and result in a double digit reduction in operating costs on trans-Tasman routes.

He said Tasman Express would adopt some of the features of the airline's one-class, cut-price domestic service, Air NZ Express, but it would retain two classes on the Tasman.

Mr Norris said the airline had also requested proposals from Airbus and Boeing on replacement aircraft for its eight B747s and 12 B767s, as part of a sweeping review of its long-haul international operations. But he reiterated that the airline's long-haul international services could be in jeopardy if regulators rejected its proposed alliance with Qantas.

Mr Norris said the airline still hoped to convince the Australian Competition and Consumer Commission and New Zealand Commerce Commission that their veto of the deal was based on flawed assumptions.

He ruled out pursuing an alternative deal with Singapore, which holds about 5 per cent of Air NZ, if the Qantas deal was rejected. Asked what plan B was if plan A - the Qantas alliance - failed, Mr Norris said: "Go back to plan A".

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[Tuner 2]

Rich-Fine-Green,

I just searched the QF website and you can do SYD-WLG departing tomorrow and returning Sunday for $491.76.

There are also heaps of SYD-AKL return flights next week for the same price. A far cry from the "$1900" you're whinging about.

As for Freedom, SYD to Palmerston North departing 31 July returning 06 August is over $200 more expensive than QF at $715.30.

:}

[Wirraway]

Thurs "Dominion Post"

Virgin plans NZ subsidiary
31 July 2003
By ROELAND van den BERGH

Virgin Blue could start a stand-alone company for its proposed New Zealand operations and fly here under a different name, head of operations David Huttner says.

Virgin Blue plans to enter the New Zealand aviation market by the end of the year.

Setting up a New Zealand subsidiary would allow it to take advantage of cheaper operating costs, including civil aviation rules allowing one less cabin crew on Boeing 737 jets.

The New Zealand company would operate independently, but overall group strategy would still come out of Virgin Blue, Mr Huttner said.

Virgin Blue would be based in the main centres to fly early morning flights to Australia.

Qantas operates a similar lower-cost model with JetConnect, which employs New Zealanders for its domestic operation.

The planes carry the Qantas name and livery.

It will expand the model on to trans-Tasman routes from September, except for services to and from Auckland, which would continue under Qantas's own banner.

Mr Huttner said Virgin Blue would do what was required to remain competitive.

"We would not want to let them (JetConnect and Freedom Air) get the jump over us in any way."

The airline would probably not fly under the Virgin Blue brand across the Tasman or domestically in New Zealand because of rights over the Virgin name, he said.

Singapore Airlines, as 49 per cent owner of Virgin Atlantic, is understood to have refused Virgin Blue permission the right to use the Virgin brand outside of Australia.

British tycoon Sir Richard Branson owns the remainder of Virgin Atlantic and also half of Virgin Blue.

Mr Huttner said that while the name on the planes would be different, the product would be similar.

Potential names were being kept secret.

Virgin Blue was already in preliminary discussions with Wellington and Christchurch airports to set up a New Zealand base.

Auckland was not in the running at this stage because its airport lacked sufficient check-in counter space and aircraft gates.

However, if Virgin Blue's demand for unrestricted space was granted, Auckland would also be considered for the operations base, Mr Huttner said.

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[Keg]

Now this is getting REAL interesting. A VB NZ start up would presumablly be cheaper than VB Aus. With a new bill before parliament that could seem VB NZ free to operate on Australian domestic air routes under their NZ AOC, QF drivers may no longer be the ones upder pressure for their pay and conditions.

Not revelling in this at all. Just stating that those elsewhere who may have looked at QFs pay and conditions and seen them as 'over priced', etc, and therefore deserving of being undercut may well be looking down the barrel of the same make of gun- albeit wielded by a different person.

This industry is going down hill in a rapid way.

[permFO]

In fact the blokes at Jetconnect would love to be on VB pay. Their wages are pegged to Freedom and I would imagine that any Virgin operation out of NZ would be much the same. I can't imagine there is a lot of yield crossing the Tasman so someone is going to get burnt. Surely the ACCC should finally see the big picture and see that a QF-ANZ tie up is not going to stifle competition. As the Chinese funny man said "May you live in interesting times!".

[Maisk Rotum]

As I said on the 27th watch this space;



VIRIGIN NZ

Rumour has it that the Scarlet Lady/Blue Bombshell will be plying the NZ skies pretty soon. Discussions underway for a startup pre years-end. Can't say too much yet but watch this space.

What's got me wondering though is where are all those blonde hosties are going to come from. Not too many blondes in NZ.




Rumour has it there will be a tie up with a certain 'national' operator.

[HGW]

You have to be kidding about not many blondes.
I know of 70 odd million. Alternatively, buy shares in a Peroxide company.

[Flyer 682]

Will the unveiling of Tasman Express mean the final curtain for Freedom Air? :confused:

[Vmo248]

Bongos are that someone has bought some ex 'OZ B737-300's for NZ internal service.

A particular Dk Blue/ Grey coloured NZ carrier already has slots into/out of major cities, and has a bit of biffo with the "National" carrier...

[No worries mate]

VMO,

Richard has said it before, he prefers to start an operation from scratch rather than purchase/use another business, he learnt his lesson when he purchased a small airline in Europe (which is now Virgin Express).

Maisk,

Yes there will be red aircraft is the NZ skies by years end, but it won't be Virgin NZ. It will Virgin Blue aircraft and crew. Tech crew's from Virgin Blue have been doing sim checks out of NZ airports for the last 6 months.

[no_HANDLE]

A/C with red on them.....YEP!

That would be UAE who started flights into NZAA ex Sydney on Friday the 1st of August.

Adverts for $399.00 return.

Let the games begin:O

[stillalbatross]

3 different 737 operators plying between AKL-WLG-CHC? Has someone forgotten there's only 4 million people in the place. Yes, it's good that there's jobs but you gotta wonder.