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Post by Ykato on Aug 16, 2010 12:21:25 GMT 12
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Post by Peter Lewis on Aug 16, 2010 18:39:18 GMT 12
As has so often been shown in the past, no airline operating in New Zealand can compete with Air Kiwitaxpayer.
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Post by kiwithrottlejockey on Aug 16, 2010 18:48:57 GMT 12
As has so often been shown in the past, no airline operating in New Zealand can compete with Air Kiwitaxpayer. More like....no airline operating in New Zealand can compete unless they operate to Kaitaia, Kerikeri, Whangarei, Auckland, Hamilton, Rotorua, Tauranga, Whakatane, Gisborne, Napier, Taupo, New Plymouth, Whanganui, Palmerston North, Masterton, Wellington, Blenheim, Nelson, Westport, Hokitika, Christchurch, Timaru, Dunedin, Queenstown and Invercargill. Take Jetstar as an example. They don't fly to the places I fly to in provincial areas, so I will never fly with them on trunk routes. If however, they started flying to all those provincial towns & cities, then I would probably fly with them including on the trunk routes. I have always lived in provincial centres, so airlines like Jetstar who just cherry-pick the trunk routes and ignore us provincial folk are never going to receive our support. And the same applied to Pacific Blue. |
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Post by Peter Lewis on Aug 16, 2010 19:18:06 GMT 12
As per Origin Pacific?
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Post by corsair67 on Aug 16, 2010 19:18:44 GMT 12
This is wonderful news for Kiwis - another company out of the competition. Now all that remains is for Jetstar to be driven out too, and then good ol' Air New Zealand can start charging whatever they like on the main trunk, just like they did before competition was allowed. I can't wait to start paying $400 to fly from Christchurch to Auckland again.  You really don't get it, do you?  |
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Post by kiwithrottlejockey on Aug 16, 2010 19:44:42 GMT 12
Origin Pacific didn't fly to the places I lived at such as Gisborne. So didn't use them. Air NZ Link however did operate out of Gisborne when I was living there, so I made use of them. Same with Masterton where I'm living now. If Jetstar wants my business, then they'll fly out of Masterton like Air NZ Link does so I can use them when I fly to Auckland. |
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Post by thomarse on Aug 16, 2010 22:18:52 GMT 12
I travel mainly for business.
If I've got to be in Auckland at 10.00, I've got to be there at 10.00, not 11.00 or 12.30 or tomorrow.
I'll be on Air NZ. Sure it'll cost, but I'll be there and guess what? The fare I pay might be a fairer indication of the true cost of operating the service.
They cram 180 bums into an aircraft at those fares (complete with every second passenger dragging a near full-size suitcase aboard to save a lousy ten bucks) and it still doesn't pay?
Apparently not.
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Post by haughtney1 on Aug 16, 2010 22:59:45 GMT 12
Hardly a surprise I'd venture to say, and I agree with you flyer, Air NZ as well as its Link network, certainly benefit from being effectively a Government entity..and are run as such with matching attitudes to competition.
Pac Blue, just like Jetstar are in business to make a profit, if you can't do that, you can't stay in business...simple really.
Air NZ (or link for that matter) have no REAL need to be profitable, and can therefore compete on the basis of frequency and quality of service..rather than having to make more than a token return on investment (for domestic ops)
I'm not saying that this is the case for Pac Blue pulling out, nor is it more than a simplistic view of Air NZ's business model...but I am saying that as long as the current state of affairs exists, there will only ever be 2 viable carriers on the main trunk routes.
Lets face it, NZ needs a population of about 10 million before it can enjoy the benefits of economy of scale in comparison to Australia. (and I bet you wouldn't even notice the increase in smiling faces!)
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Post by corsair67 on Aug 16, 2010 23:08:07 GMT 12
Airlines like Jetstar are never going to fly to anywhere other than the main trunk routes or the major tourist destinations like Queenstown & Rotorua. Their business models rely on high-volume and low costs to survive. Many of the smaller regional places in New Zealand (and Australia too) can barely support the services they have already, so it's not like any other player is going to add those routes to their schedule. You may also find that in many cases, local councils are subsidising these operations to an extent to keep the airline servicing them in the game.
It's the same on this side of the Tasman: the foreign owned budget airline, Tiger Airways, is never going to fly to small regional towns like Wagga Wagga, Mount Isa, Mildura or Geraldton.
Obviously, the budget airlines aren't really a viable alternative for most business travellers - and for most of them - that is not a market they actively seek anyway. Most budget airline customers are leisure travellers seeking the best deal between major centres and who aren't running to a strict timetable.
Mind you, I can think of a number of occasions when I have been stuck at various locations in NZ or Australia because either Air New Zealand or QANTAS didn't have it together for various reasons - and not all of those reasons were because of factors beyong the airline's control e.g. weather or mechanical faults.
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Post by ErrolC on Aug 16, 2010 23:11:31 GMT 12
They cram 180 bums into an aircraft at those fares (complete with every second passenger dragging a near full-size suitcase aboard to save a lousy ten bucks) and it still doesn't pay? Apparently not. They think they can make better use of their assets elsewhere. I'm not surprised when there is another low-frequency low-cost carrier in the market, and they don't get good synergy from the operation. |
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Post by corsair67 on Aug 16, 2010 23:28:13 GMT 12
Well Jetstar is looking to add to it's NZ operations. Jetstar boosts NZ services after Virgin departureFrom: AAP August 16, 2010 4:11PM LOW-cost carrier Jetstar plans to increase its fledgling New Zealand operations, taking advantage of Virgin Blue's departure from the market. The airline, owned by Qantas, says it will add two extra A320 aircraft to its eight strong NZ fleet to support more domestic and trans-Tasman routes. This includes the launch of Melbourne to Queenstown, Gold Coast to Queenstown and Auckland to Cairns services. Jetstar chief Bruce Buchanan said the airline would increase flights from Auckland, Christchurch and Wellington in advance of the 2011 Rugby World Cup. "We plan to further grow our existing domestic NZ routes and will investigate new destinations in line with our strong and expanding market presence since commencing domestic flying in June 2009," he said. The Virgin Blue airlines group said on Monday it was pulling out of an underperforming New Zealand domestic market, to strengthen its trans-Tasman, Pacific and Asian networks. Jetstar is the second airline to benefit from the move, after Air New Zealand said it would pick up thousands of Virgin Blue's disrupted passengers. "We have confirmed that we're able to re-accommodate their customers and understand Pacific Blue will soon contact passengers to discuss their options," Air New Zealand Group General Manager Australasia Bruce Parton said in a statement. He said passengers would be rebooked onto Air New Zealand services as close to their currently booked departure time as possible. In addition, Pacific Blue passengers would be offered free membership to Air New Zealand's Airpoints program. Virgin said following the first phase of a network review, its Pacific Blue operation would expand as a medium-haul international airline, while its long-haul V Australia aircraft would be available to strengthen the US route. "By year-end, V Australia will be fully devoted to international long haul business more suited to the B777 fleet, with Fiji serviced by Pacific Blue," Virgin Blue chief executive John Borghetti said in a statement. "We are delivering what our guests tell us they need - more capacity and frequency on eastern seaboard capital city routes, and to key tourist destinations such as the Gold Coast and Uluru." The company said "recent changes to our domestic flight patterns and frequencies now provide more than 490,000 additional seats across the Virgin Blue domestic network". "As we enter a new era for Virgin Blue, it is vital that we have the right aircraft on the right routes if we are to fully exploit our competitive advantages in the context of the group's three core business: domestic short haul, international medium haul and international long haul," Mr Borghetti said. "We are adding capacity to routes with strong revenue potential and, accordingly, removing capacity from services which are underperforming." Key schedule changes would include more flights across the Tasman and to Bali and Thailand, rescheduling V Australia's Sydney-Los Angeles service, daily services on that route from December 10, and extra services between Melbourne and Johannesburg, Los Angeles and Thailand. Mr Borghetti said more developments were "in the pipeline" and further announcements would be made in due course. www.theaustralian.com.au/business/news/jetstar-boosts-nz-services-after-virgin-departure/story-e6frg90f-1225905978921 |
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Post by kiwithrottlejockey on Aug 16, 2010 23:36:05 GMT 12
Still no good to me.
Over the past twelve months (to give an example) I have flown domestic services into and/or out of Auckland, Gisborne, Napier, Masterton, Wellington, Christchurch, Hokitika and Queenstown.
Jetstar only fly to half of those destinations, and then only between them, so due to the fact many of those flights that were into or out of the places Jetstar flies to were between those places and the places Jetstar don't fly to, then Jetstar are useless to me. The same applied to Pacific Blue.
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Post by ErrolC on Aug 17, 2010 8:49:03 GMT 12
Still no good to me. Over the past twelve months (to give an example) I have flown domestic services into and/or out of Auckland, Gisborne, Napier, Masterton, Wellington, Christchurch, Hokitika and Queenstown. Jetstar only fly to half of those destinations, and then only between them, so due to the fact many of those flights that were into or out of the places Jetstar flies to were between those places and the places Jetstar don't fly to, then Jetstar are useless to me. The same applied to Pacific Blue. But you started out by saying: don't fly to the places I fly to in provincial areas, so I will never fly with them on trunk routes. If however, they started flying to all those provincial towns & cities, then I would probably fly with them including on the trunk routes. I have always lived in provincial centres, so airlines like Jetstar who just cherry-pick the trunk routes and ignore us provincial folk are never going to receive our support. There is a big difference between saying 'they don't serve all my needs' (not that anyone was saying that they did or would) and 'they don't serve all of my needs so I will never use them for anything'. |
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Post by skywagon180 on Aug 17, 2010 10:37:07 GMT 12
I always fail to understand why people think that they can get AKL-CHC for less than the cost of the taxi to the airport, less than the cost of leaving the car at the airport carpark for the weekend. There is a rourt going on here but it is not the airlines, it is the places where aeroplane hang around when not flying!
Last month I travelled from CHC CBD to the airport and the cost was $42.00 why is that. Would it be that the Taxi is charging the real cost with a rate of return to the owner? Why are airlines expected to not return anything on investment?
Air NZ may be 78% owned by the taxpayer but the taxpayer has not put in any cash to keep the operation running, in fact Air NZ has paid the government a return on its investment! The cash stays in NZ so it is also helping the balance of accounts, as opposed to were the money goes with the Aussie banks and Airlines!
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Post by corsair67 on Aug 17, 2010 14:59:20 GMT 12
Yes, but if you travelled in the taxi with another person to the same destination, then it would have only cost you $21.
Much like discount airfares, the airlines are hoping to get 130-180 on a 737 or A320 @ $40-200/person.
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Post by westland831 on Aug 17, 2010 18:03:45 GMT 12
I'm also on Air NZ's side with this... Coming from Hokitika originally I'll all for provincial air services that Ansett, Qantas, Pacific Blue and Jetstar have never serviced... and what is more they have actually harmed. I know of lots of people that will drive to Christchurch from the Coast to catch a cheap seat on the main trunk highly with the highly competitive fares thus weakening the provincial services.
The other thing in AIr NZ's favour is many of the provincial centres have got far better schedules now than they did when Air NZ had no competition. Hokitika used to get two Friendships leaving within an hour of each other in the middle of the afternoon... it now has four to five flights a day including peak time flights.
And since the recession fares to the provinces have been dropped as Air NZ tries to stimulate business. For all Air NZ's faults we are I think they have done well to make flying more afforadable and still keep it available to all NZ
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Post by madaero on Aug 17, 2010 19:57:09 GMT 12
having been a loyal supporter of pacific blue over the last few years, weather it be internationally or domestically, having travelled both with them, i must admit that i am sad they will be leaving us domestically. i have had many a memorable trip between akl and chc with them and would happily admit that for what it cost me, they walked all over air new zealand as far as customer service is concerned. you want to travel from a to b as quick as you can, for as cheap as you can? go pacific blue. im guna miss you . in saying that, jetstar comes a close second for me. air new zealand has never had anything to offer me as far as competitive prices between hamilton and christchurch,hense, the support i give to these other competitve airlines,all be it travelling to auckland to enjoy there service. air new zealand, you can happily have your outdated old cookies and yucky coffee thats free,give me something half descent to have even if it costs me!! again, only my 2 cents worth.
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Post by Bruce on Aug 17, 2010 21:49:06 GMT 12
Having worked in the "inner sanctum" of a "REALLY" Budget airline, I think that by nature startups will tend to be very short lived - the model they use makes them very vulnerable when they take on an established player. Much as low airfares are nice for the travelling public, you simply cannot operate at prices that low.
In a budget startup you do not have the capital to sustain the losses made, nor the luxury of a large number of routes to cross - subsidise the low fares. The profit (or break even!) margin is so slim, operational expenses such as maintenance, spare parts and servicing downtime get squeezed. Having been in the middle of such a scenario, I know it can happen with all the best intentions in the world. And after all that, all it takes is for Air NZ (or anyone else) to drop their prices - the startup will ALWAYS break first as they dont have the mass to absorb it.
NZ airline history suggests that the only real way to get big enough to dictate prices is to start small on regional routes without competition - as Eagle and Air Nelson did - and work your way up.
Credit to Pac Blue, but the model is flawed, and they were always going to blink first.
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Post by madaero on Aug 17, 2010 21:57:23 GMT 12
i guess my opinion is slightly biased as i do work alongside and rely on pac blue along with others to keep my job open?
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Post by kiwithrottlejockey on Aug 17, 2010 22:56:26 GMT 12
The crux of the matter is that Pacific Blue took in tens of millions of dollars less revenue than what it cost to operate their domestic services. And that is what has killed off all of the other airlines that have tried to break into the NZ domestic market by operating soley on the trunk routes and doing it on the cheap.
Cheap airfares are "nice to have" but if the airline is charging fares that are too cheap to cover costs, then they are going to go under eventually.
Just look at the experience of the others that have come and gone.
Plus, I reckon only operating trunk services has a lot to do with it. If you don't fly to where people want to go, then those people are hardly likely to use your trunk services. I am a classic example of that.
Even using Air NZ to fly the provincial routes and a cheap airline on the trunk routes doesn't necessarily work. Take last December as an example. I attended the 75th Airline Anniversary celebrations at Haast. I flew to Hokitika and hired a rental car, then flew from Hokitika to Gisborne on the Monday morning to meet up with some friends (from overseas) for a pre-xmas dinner party. I wanted to get from Hokitika to Gisborne reasonably quickly without having to take all day to do so, taking into account that you have to go via Christchurch and Wellington. Air NZ was able to offer me relatively seamless travel flying Eagle Air from Hokitika to Christchurch, then onto an Air NZ National service that was scheduled to depart Christchurch 15 minutes after the flight from Hokitika was scheduled to arrive. At Wellington, it was 30 minutes between the flights. I checked in at Hokitika and received a boarding pass for all three sectors. As it happened, the flight from Hokitika to Christchurch was running late and it landed at about the scheduled departure time of the second sector. If I had booked Pacific Blue or Jetstar for that middle sector, they would have simply regarded me as being a "no-show" and buggered off. However, Air NZ got me (and three other people making the same connection) onto the Air NZ flight to Wellington. We were met as we alighted from the Eagle Air flight and accompanied by security, we were walked across the tarmac to the Air NZ 737 (with our bags also being whisked across the tarmac). An aviation security guard put us through the security proceedures on the tarmac (with one of those hand metal detector wands) while the Air NZ employee who met us raced up into the departure lounge with our boarding passes to scan them. The 737 had been pushed back from the gate, but they had then opened the door again and pulled out the inbuilt stairs. We got our boarding passes back and boarded (while our bags were stowed in the hold), the pushback was then completed and we were on our way. If I had been booked on one of those discount airlines for that middle sector, I would have been left behind at Christchurch. The only way around that would have been to have taken most of the day to get to Gisborne by leaving big gaps between the sectors. So because Air NZ could get me relatively seamlessly all the way from Hokitika to Gisborne, they got my business.
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