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Chinese airline growth in direct services will reduce New Zealand dependency on Australian transfers

Analysis

China Southern Airlines is on track to achieve its target of having 55 weekly flights to Australia/New Zealand by the end of 2015, with peak southern summer flights to reach 52 weekly. China Southern's presence in Australia has been highly visible, but its growth in New Zealand has been quieter. After entering New Zealand just three years ago, China Southern in 2015 will have more peak capacity there than Cathay Pacific. China Eastern will also enter the market, although only for the peak season, while Air China has flagged entry into New Zealand as part of a proposed joint venture with Air New Zealand. Chinese visitor numbers to New Zealand have doubled in four years.

This additional capacity should help New Zealand receive more direct Chinese visitors. This will help reduce its reliance on passengers arriving from Australia, which in 2013 accounted for half of the Chinese visitors to New Zealand. Air China's proposed joint venture with Air New Zealand will help Air New Zealand's prospects in mainland China. The two have been distant, causing Air New Zealand to withdraw from Beijing. Still, Air China may not be enough for Air New Zealand, which may need to consider another Chinese partner.

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