Airports association calls for action for fair prices

Airports association calls for Commerce Commission action to ensure fair prices on ‘monopoly routes’

New Zealand Airports Association (NZ Airports) has welcomed Air New Zealand’s commercial success, but says regions are right to question whether provincial routes are generating excessive profits.

Association chief executive Kevin Ward said the situation could be resolved by the Commerce Commission introducing an information disclosure regime for regional airlines with monopolies on routes.

“News of a third consecutive rise in Air New Zealand profits shows our national airline is consistently successful, which is good for New Zealand,” said Mr Ward.

“Making a profit is a good thing for the airline’s ongoing investment, innovation, reliability, and promotion of New Zealand, but very high airfares have a choking effect on regional economies, business connections, tourism and social links.

“There are big question marks around Air New Zealand’s monopoly domestic routes where there is potential for excessive profits, and no transparency or monitoring.”

Mr Ward said there is currently a lack of good information and analysis which would enable people to see for themselves if airfares to the regions are reasonable or not.

“It would be in the national interest to have transparency and disclosure on those domestic routes where there is no choice for air passengers,” he said.

“The Commerce Commission could be directed by the Government to include monopoly regional airlines in an information disclosure regime. That would be the best way to assure New Zealanders that Air New Zealand’s prices are fair.

“Quality standards and schedules could also be included to ensure the reasonable needs of each region are met.”

ENDS

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