Shares in Air New Zealand took a hit yesterday after Jetstar announced the launch of an operation to take on the NZ carrier in its home market.
The Qantas budget offshoot will begin flying to four New Zealand regional centres using a fleet of five 50-seat Bombardier Q300 turboprop aircraft. Air New Zealand has had monopolies on the routes for years.
Speaking in Auckland, Qantas chief executive Alan Joyce said Qantas considered airfares in the New Zealand market were “significantly high”.
Joyce said that when Jetstar first launched trans-Tasman services in 2005 and domestic services in 2009, prices fell by an average of about 40%.
“Now we’ll do the same for regional New Zealand,” Joyce proclaimed. The remarks sent Air New Zealand share prices into a nosedive by as much as 12%, the Sydney Morning Herald reported.
The new Jetstar operation is set to start by the end of this year, with regional fares on sale in September for the first flights in early December.
Hamilton, Rotorua, Napier, New Plymouth, Palmerston North, Nelson and Invercargill are all being considered as options, reprotedly.
To get the strongly patriotic New Zealand public onside, Jetstar has launched a social media campaign asking customers which regions they most want the airline to serve.
Plans for a two month roadshow to promote the new operation are under way.
Air New Zealand plans to add 650,000 seats to its domestic network next year, with larger planes and more frequent services .
Aspiring newcomer airline, Kiwi Regional Airlines, is planning to launch domestic services from Nelson by early next year. Whether its plans will be affected by what promises to be a domestic war between Jetstar and Air New Zealand remains to be seen.
Written by Peter Needham