Jetstar swoops on Air New Zealand’s regional monopoly

Jetstar has announced that it plans to start regional services in New Zealand using 50-seat Bombardier Q300 aircraft, previously used in Australia by QantasLink.

Air New Zealand shares plunged ten percent before the announcement, although have since staged something of a recovery. At present Air New Zealand essentially has a monopoly on regional commercial flights in New Zealand.

Picture courtesy Jetstar

Jetstar branded Q300 (picture courtesy Jetstar)

Jetstar will announce its network of at least four initial regional destinations in September, when it opens them for booking, and plans to start regional flights in December 2015.

Qantas Group CEO Alan Joyce was joined New Zealand’s Prime Minister John Key to make the announcement in Auckland, perhaps reflecting the political realities. The New Zealand Government is the majority shareholder in Air New Zealand.

Jetstar claim that six years ago when they “first started operations in New Zealand, domestic fares across the country dropped by around 40 per cent, and we expect fares will drop considerably on the regional routes where we’ll operate”. Jetstar currently operate a New Zealand fleet of nine Airbus A320 aircraft.

Interestingly, while the Jetstar-branded regional services will be marketed and managed by Jetstar, they will be operated Eastern Australia Airlines for QantasLink.

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