Virgin Blue says it could win one third of NZ aviation market

By NZPA

Friday 7th February 2003

Australian airline Virgin Blue contends it could capture a third of the trans-Tasman and domestic New Zealand aviation markets if it is given a "fair" chance to compete against Qantas and Air New Zealand, the Australian Financial Review reports today.

The company is expected to strongly oppose the planned Qantas-Air NZ tie-up in submissions to be lodged with the Australian and New Zealand competition regulators next week.

However, it will argue that if the plan is to proceed, the deal should be conditional on much more generous guarantees on airport access in New Zealand for new entrants and that Air NZ should be forced to divest its no-frills subsidiary, Freedom Air, AFR reported.

In what could be seen as a positive sign for the alliance plan, Virgin's head of commercial operations, David Huttner said Virgin saw significant potential in New Zealand if it could negotiate enough incentives.

"We think we will hit a third of the (Australian) market next year and we see no reason why we can't achieve a similar share in New Zealand if given a fair opportunity," he told the paper.

Virgin will argue for "structural guarantees" to ensure competition. rather than behavioural undertakings that could not be policed, particularly in the "opaque" area of airline pricing.

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