Is freedom to be assimilated...?
 

Air NZ's low-cost riposte



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Might Air New Zealand's cheap-seats response to Pacific Blue knock its own Freedom Air from the skies?

The introduction of two levels of economy class seats on Air New Zealand's domestic and transtasman services means the airline will be uniquely combining in one plane conditions that are found separately on so-called "full service" and "low cost" (or "no frills") airlines.
Air NZ's new "domestic experience" - its response to the challenge of low-cost carriers Pacific Blue and, possibly later, Qantas' Jetstar - was spelt out by the CEO, Rob Fyfe, at the airline's announcement of its annual results this week. The changes will start to be introduced "by mid-next year".
Fyfe said the B737 aircraft operating on domestic services would be divided into two zones: one incorporating the current 86-89cm seat pitch, with complimentary snacks and beverages supplied on most flights, and catering specifically for frequent flyers and business travellers; the other with the seat pitch reduced to 76-79cm, similar to the airline's competitors, and with snacks and beverages to be paid for.

Fyfe said that these arrangements were to be adopted instead of creating a new airline to meet any domestic challenge, but the changes will also be partly reflected on Air NZ's transtasman services. While retaining their current business class, both the A320 aircraft and the bigger B767-300s, used mainly on the Auckland-Sydney route, will also have two economy zones.


This would appear to have implications for Air NZ's low-cost subsidiary, Freedom Air, especially if arrangements in the larger, lower-fare economy section on Air NZ's transtasman flights become comparable with those offered by Freedom. In those circumstances, it is possible that Freedom will not survive the changes.
According to its website, Freedom operates two or three flights a week from each of Hamilton, Palmerston North and Dunedin to Sydney and Brisbane, and six flights a week from Auckland, and two from each of Wellington, Christchurch and Hamilton to the Gold Coast.

The services from secondary airports Hamilton and Palmerston North, which are used mainly by New Zealand origin passengers and attract relatively few from Australia, would seem most at risk. Those routes are also less likely to attract competing airlines unless they could use aircraft smaller than Pacific Blue's B737-800s or Jetstar's A320s, both of which carry significantly more passengers than Freedom's B737-300s.
However, Dunedin, as a gateway to southern areas of the country, has more evenly balanced traffic and may therefore have a better chance of being served transtasman by the reconfigured A320s.
The future of Freedom Air was not mentioned by Air NZ this week, but with the announcement of the new arrangements to be introduced next year, it may not be long before Freedom's fate is made known.

Hmm, great reporting. Freedom haven't operated 737s since about two years ago. There is already little difference between Air NZ and Freedom in terms of fares, and they are effectively the same operation anyway.

Dunedin to SYD or BNE is usually a similar cost to AirNZ out of CHC. The cost is about $20 less because DUD passengers do not get a complimentary hot savory and drinks service. Three class A320s seem rather over the top if they are used on flights to the Gold Coast. Will AirNZ really sell premium economy seats to the Gold Coast, or will the seats be occupied by FF reward passengers?

Just been announced on TV News that Freedom Air has been Canned, all flights from Hamilton & Dunedin Airports to revert to Air NZ(zeal320) apart from palmy which has lost all trans tasman flights altogether.

Freedom Air killed off, Air NZ announces route changes

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11:38AM Thursday September 06, 2007


Air New Zealand is killing off Freedom Air and has announced changes to some of its international routes.
The airline says there is no point having a low-cost subsidiary anymore as airfares have fallen so much in the past 10 years that there is little difference in price.
Spokesman Norm Thompson said Freedom's services will be taken over by Air New Zealand flights from the end of March next year.
However direct services to Australia from Palmerston North are being scrapped, because of a lack of demand.
"We had been hoping to strengthen demand for Palmerston North services by combining Qantas and Air New Zealand demand with the proposed Tasman codeshare arrangement," he said.
"But when this proposal was discontinued, the future of such routes became far less certain."
Air New Zealand expects Wellington Airport to be the main beneficiary of the Palmerston North development as the national carrier will add nine new city pairs, including one new Australian port (Coolangatta) and two new New Zealand ports (Dunedin and Hamilton) to its international network.
Mr Thompson says no redundancies are likely and affected staff are being consulted and would be offered jobs within the company.
Air New Zealand has also announced plans to upgrade its trans-Tasman and Pacific services.
It is promising more spacious economy seats, better inflight entertainment and an improved food and drinks selection.

Really, the only surprise in this news is that it didn't happen as soon as Freedom had effectively taken KiwiJet/Ewen Wilson out of the equation. That was after all, basically the only reason Freedom was established!


Just another example of AirNZ's anti-competitive, biggest-bully-on-the-block business mentality. We've seen it before, we'll see it again. I reckon it'll be interesting to see what happens if/when they try this stunt or similar on Richard Branson! His cheque-book has got to be damn near as deep as the NZ Govt's!!! Whilst I would hate to see the National carrier gone or irrepairably damaged, I would dearly love to see them dealt a dose of their own!

+1 kiwiblue

For all the sh*t kicking they dished out to poor old ansett NZ over the years.

F**ken spot on Kiwiblue!!
Air NZ has never had a domestic competitor with bigger pockets before!
You can already see them sweating.

um. Qantas?