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Code-Share Deal Could Be Bad For Wellington

19 April 2006

Code-Share Deal Could Be Bad For Wellington

News that Qantas and Air New Zealand are proposing a code share deal on trans-Tasman flights could be bad news for Wellington. The Wellington Regional Chamber of Commerce will be writing to the Minister of Transport requesting that he decline any request from Air New Zealand or Qantas for such an exemption.

Instead the Chamber will be requesting that this proposed arrangement be given full scrutiny by the Commerce Commission.

“Any lessening of competition on the trans-Tasman air route is a concern for New Zealand. But it is particularly worrying for Wellington, where there is virtually no competition to Air New Zealand and Qantas on these routes. Our concern relates to both passenger traffic and airfreight.

A code-share deal which included Wellington would risk higher fares, fewer flights and lower airfreight capacity for our regional economy. The Wellington business community will be concerned about such possibilities”, said Charles Finny, Chief Executive Officer of the Wellington Regional Chamber of Commerce.

“Because such an arrangement between Qantas and Air New Zealand is so obviously significant for New Zealand, we are confident that the Minister of Transport will reject any requests from Air New Zealand or Qantas for exemption from the Commerce Act.

Instead of agreeing to such an exemption, the Minister and the Government should be insisting that this proposed arrangement be given full scrutiny by the Commerce Commission. We believe that deals of this type by any large companies should be given such scrutiny. If the Commerce Commission was prepared to approve such an arrangement, the Chamber would be far more comfortable”, Charles Finny continued.

“Air New Zealand and Qantas have been strong supporters of the Wellington economy. The Chamber of Commerce has valued the contribution both airlines have made.

We want to see them continuing to play this role. We don’t want to see any arrangement agreed which would see fewer flights to Australia. Rather, our interests lie in continuing competition and – if anything - an expansion of services between Wellington and destinations in Australia,” Charles Finny concluded.

ENDS

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