Boosting trans-Tasman air travel and tourism, the Australian Competition and Consumer Commission (ACCC) has today approved unilateral code-sharing arrangements between Virgin Australia and Air New Zealand.
The new authorisation will see the carriers re-establish ties across the ditch, with Virgin able to sell and market Air NZ’s trans-Tasman flights and display its airline code on these routes – which are sold and originate in Australia.
Giving Virgin customers easier access to New Zealand destinations, the news comes one month after the ACCC gave tentative authorisation for the alliance.
The authorisation is subject to Air New Zealand setting the fares at which Virgin Australia can market and resell flights.
As the marketing carrier, Virgin Australia can sell unlimited seats on Air New Zealand’s services, provided there is available inventory.
“We are satisfied that the sharing of resources by these airlines will provide consumers with more ticketing and price options on trans-Tasman routes,” ACCC Deputy Chair Mick Keogh said.
“Virgin Australia and Air New Zealand will also be able to jointly offer discounts and a range of marketing options to businesses, and eligible Virgin Australia customers will have access to Velocity Frequent Flyer program benefits and international lounge access.”
The proposal won’t affect routes where Virgin currently flies its planes – between Queenstown and Melbourne, Sydney and Brisbane – or where VA starts flying in competition with Air New Zealand.
“We consider that these conditions significantly limit the potential for the code-sharing arrangements to lead to anti-competitive behaviour,” Mr Keogh said.
After tentative approval was granted in May, Keogh said the ACCC didn’t believe codesharing would make more people want to fly Air New Zealand, which might push prices up.
“We consider it unlikely that any significant increase in passenger demand for trans-Tasman services due to this code-sharing arrangement would raise airfares,” he stated.
“On current information, we also consider that the code-sharing arrangements do not materially reduce Virgin Australia’s incentive to operate its own services on other trans-Tasman routes.”
More details can be found at the ACCC’s public register here.
