01/07/09, 22:11:03 UTC

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Domestic airline in NZ still on agenda

stuff.co.nz

Jetstar Airways remains committed to starting a New Zealand domestic airline despite being beaten to the punch by Sir Richard Branson's Pacific Blue.

Jetstar chief executive Alan Joyce said the entry into New Zealand's domestic passenger market by Pacific Blue had always been factored into Jetstar's plans.

Christchurch remained the centre for Jetstar's New Zealand and trans-Tasman operations, though that could potentially change as the airline developed.

"We see the domestic New Zealand market as an opportunity for us as well. It is something that we continue to monitor," Joyce said.

"Nothing has changed with Pacific Blue's entry. That was something that we were expecting. It has been on our radar scheme for some time, we still think there may be an opportunity for us in the future."

Last month Pacific Blue said it would increase Christchurch staffing to back a plan to launch a Christchurch-Wellington-Auckland domestic route in November.

Then Air New Zealand said it would ground its budget airline, Freedom Air, which was seen as an advantage to Jetstar, Joyce said.

"With Virgin (Pacific Blue) going into their space as a new world carrier, and Freedom obviously disappearing, it means Jetstar is really the only low-fares airline flying into New Zealand now which leaves us in a unique position – we know people are very keen on low airfares. From our perspective that gives us a marketing opportunity and position to grow our presence in New Zealand," he said.

However in the short term Jetstar had a lot of long-haul commitments. It was awaiting the delivery of the new generation Boeing 787 aircraft from August 2008 to release Airbus aircraft, and that long-haul fleet could eventually key directly into New Zealand, Joyce said. "We're doing that long-haul, we (believe) that could work in a number of different markets, and I wouldn't rule that out for New Zealand as well." Joyce was speaking from Kuala Lumpur at the launch of services between Sydney and Kuala Lumpur, Malaysia three times weekly.

Jetstar remained pleased with the airline's performance out of Christchurch. "We wouldn't rule out other potential bases in New Zealand, but it makes life easier because we've got two aircraft already in Christchurch, we've got the infrastructure in place and cabin crew, pilots and our own engineers there in Christchurch.

"It makes logical sense for us to expand the base there first."

Pacific Blue's entry had not necessarily put back the timing any potential plans by Jetstar.

"Obviously we'd use every piece of information you have to make your judgment call on it and you'd see how the market was performing, and what the dynamics were when you make your entry but certainly I think it's too early to say whether it would have any impact."

Jetstar says the view held by some in the sector that its parent Qantas would exit the New Zealand market upon its entry could well be misheld.

Jetstar, Qantas and Virgin were operating profitably in the Australian market.

 Printable Version  | published Sep 10, 2007