New Zealand is in the throes of choosing a new flag – and just to liven things up further, a full-scale price war has erupted between Jetstar NZ and Air New Zealand on domestic routes.
No sooner had Jetstar announced four new domestic destinations – Napier, New Plymouth, Palmerston North and Nelson – and super-low inaugural fares, than Air New Zealand stepped in and matched the fares.
All the destinations will connect with Auckland, with one route between Nelson and Wellington. Centres which missed out were Hamilton, Tauranga, Rotorua and Invercargill.
Jetstar launched the flights, starting from December and February, with startlingly discounted fares of NZD 9 (AUD 8.14), which reportedly caused its website to crash under the heavy demand.
Air NZ leapt into the fray, launching NZD 9 domestic fares on its “grabaseat” online site.
As Air NZ chief executive Christopher Luxon put it last week: “We don’t lose to Australians at home.”
His words, with provocative sporting overtones, made it clear the NZ carrier would not be undercut in its home market.
Last Wednesday, Luxon said Air NZ would offer up to two million NZ domestic fares under NZD 100 and boost domestic capacity 8% this year. The airline is fully confident of stimulating the market and filling those seats.
Jetstar says its regional expansion will create 100 jobs for pilots, cabin crew and ground crew.
Any protracted domestic fare war in New Zealand will benefit consumers and tourism. The two rivals, Air New Zealand and the Qantas group, are both profitable.
Jetstar NZ holds 17% of the New Zealand domestic market, which is dominated by Air NZ. Kiwis are pretty patriotic, but as Jetstar’s launch of ultra-cheap seats shows, that doesn’t slow customers down when it comes to bookings.
Jetstar currently flies Airbus A320 jets to Auckland, Wellington, Christchurch, Dunedin and Queenstown. It will serve its four new routes with five 50-seat Bombardier Q300 turboprops, charging base fares of NZD 45 to NZD 49.
JETSTAR’S NEW ROUTES
From 1 December 2015:
From 1 February 2016:
- New Plymouth-Auckland
- Palmerston North-Auckland
Written by Peter Needham