Cheaper Flights Across The Ditch

4 September 2003

CHEAPER FLIGHTS ACROSS THE DITCH TO SAVE NEW ZEALAND SMALL BUSINESSES MILLIONS

New Zealand's small and medium sized companies will save an estimated $3 million annually on their trans-Tasman flight costs once Tasman Express flights commence on October 29 - that's the equivalent of an extra 5,500 return flights to Sydney for their same current spend.*

An Air New Zealand study of the trans-Tasman travelling patterns of SME customers and their spending levels in the past year has shown this important sector of the New Zealand economy is projected to save an average of 24% on their $12 million-plus flight spend if booking the same level of travel on the new Tasman Express fares.

As an example of how Air New Zealand's new one-way fares translate into savings for business, in the 10 months since domestic Express Class began service, the SME market has saved 20% or just over $8 million on expected flight spend within New Zealand, compared to flight costs for identical travel during the comparable 10 month period in 2002.

The new Tasman Express savings have been modelled on SME businesses continuing to book through their normal personal channels. Air New Zealand estimates that an additional $500,000 per year could be saved if SME's made their own trans-Tasman flight bookings online.

As well as lower fares, one of the biggest advantages to the business market - especially for smaller companies on tighter budgets - is that Tasman Express fares are not conditional on a compulsory Saturday night stay. This requirement used to accompany almost all of the historic cheaper fares and remains a firm condition for a number of other airlines flying across the Tasman. This means that all business travellers now have access to the entire range of Tasman Express fares and can choose any airfare dependent only on their personal need for flexibility.

Software specialist Exor Corporation, the Asia Pacific wing of a UK-based company, is typical of the small businesses that will benefit from Tasman Express.

General Manager Asia Pacific Philip Caunter described the new fares as "tremendously positive."

"We only have five specialists working for our company - based in Christchurch, Wellington, Sydney and Perth," he said.

"Our English head office regularly queries why our trans-Tasman travel costs so much, when from their base they fly to the US all the time at a fraction of the cost. They've even asked us to stay overnight on Saturdays to keep the travel costs down, which so far we've resisted doing.

"Tasman Express with its axing of the Saturday stay condition, now means we're free to travel when we want to rather than jumping through hoops to get cheaper fares."

Caunter expects his travel bill will stay the same, but that he and his team will increase their numbers of journeys.

He explained: "We can now send the best person for the job - if that's our Perth expert who's needed in Wellington, then we'll send him whereas at the moment we'd hesitate due to cost- these new fares will give us that financial freedom to deliver the best customer service where it's needed."

Additionally, the flexibility of using one-way pricing means travellers can take a cheaper, more rigid fare for their outbound journey to Australia when they are certain of their meeting start-time, but buy a more flexible ticket for their return enabling changes to their homeward flight if their meeting runs late.

ends

*Based on a mid-range Tasman Express Flexi Saver lead-in fare (Auckland-Sydney) of $269 one-way, excluding taxes, levies and airport charges.

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