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Air NZ: Origin Pacific Update

11 August 2006

Origin Pacific Update

Statement From Air New Zealand Chief Executive Officer Rob Fyfe

Air New Zealand has been in discussions with Origin Pacific from time-to-time in recent weeks on several proposals the regional carrier has put to us to try to assist it to address recent financial difficulties.

Air New Zealand has been unable to accept those proposals for a range of reasons, including our belief that without Commerce Commission authorisation they would have been anti-competitive and unlawful, or they were not in the best interests of Origin's customers.

There was never any arrangement agreed between Origin and Air New Zealand. Origin founder Robert Inglis media statement earlier today claiming Air New Zealand has "gone back on discussions" is a deliberate attempt to mislead the public and yet again pass the buck for the predicament of his business.

The quoted statement from Air New Zealand executive Norm Thompson was rejecting a proposal that would have seen Origin pocket some of its customers' money while Air New Zealand provided the services.

In our view the actions of Mr Inglis, who has been vocally supported by Nelson MP Nick Smith, have not been in the best interests of Origin Pacific's customers.

Air New Zealand yesterday sought via a media release to reassure Origin's customers that we would carry them if we could come to a satisfactory arrangement with the regional carrier.

We understand from Origin that it has collected around $1.5 million from 14,000 customers who have not yet travelled on the tickets they have purchased.

Air New Zealand has been trying to establish from Origin what has happened to those funds and why it will not transfer them to us so that we can carry the passengers it has abandoned in such a reckless and cavalier fashion.

I am deeply concerned that Origin chose to put a statement on its website at 8pm yesterday advising its customers arrangements had been made for their carriage with Air New Zealand with the full knowledge this was false and misleading.

Mr Inglis contacted Air New Zealand less than half an hour after the statement had been published on Origin's website asking how we could help his customers.

Then on Radio New Zealand this morning Mr Inglis again highlighted the fact that he had misled his customers when he made the following statement:

"Yesterday afternoon Air New Zealand issued a press statement saying that they would carry Origin passengers dependent on the deal that could be arranged and we attempted to negotiate with Air New Zealand last night and that has not been successful at this stage."

The actions of Mr Inglis have been reckless and we are at a loss to understand why a supposedly solvent company has not confirmed to its customers their position on funds allegedly held in trust. That would at least enable them to make informed decisions on other arrangements.

Mr Inglis comments today that Origin will "do its best to honour" its passengers' fares and that "this may take some time" are cause for concern.

Nor will Mr Inglis clarify whether Origin is in a position to pay its customers' funds to us so that we can fulfil the travel obligations Origin committed to.

In our discussions with Mr Inglis today, we have been left with the clear impression that he expects Air New Zealand to carry his customers at a significant discount so that his firm can pocket some of the customers' money.

Nevertheless, Air New Zealand remains committed to supporting the nation's travellers and the reputation of New Zealand aviation and has made a series of arrangements to assist Origin's customers with special fares. We have also addressed compassionate circumstances where necessary but remain appalled at Origin's disregard for both their obligations to their customers and the availability of the funds they have paid.


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