Australia-NZ travel rebounds as borders reopen
New Zealand's main gateway at Auckland Airport is seeing a strong rebound in traffic from Australia following the New Zealand government's latest border reopening step, and airlines are preparing to add more routes when travel resumes from other overseas markets.
Australian residents were allowed to enter New Zealand quarantine-free from 12-Apr-2022, which has furthered two-way travel flows between the two countries. Quarantine and isolation requirements for returning New Zealanders had already been dropped in Mar-2022, and Australia has been allowing New Zealanders to enter since Nov-2021.
This is a very important traffic corridor for both countries, so the return of more flights is a massive step for the Australasian travel and airline industries.
Of course, flight numbers and traveller volume are still way down on pre-pandemic levels, but the restoration of trans-Tasman routes presages what will likely be a continued upward trajectory as customer confidence and demand improve.
- Auckland Airport is experiencing a strong rebound in traffic from Australia following the New Zealand government's border reopening step.
- Flight numbers and traveler volume are still below pre-pandemic levels, but the restoration of trans-Tasman routes indicates a positive trajectory for the travel industry.
- Qantas and its subsidiary Jetstar have significantly increased their flights to New Zealand, bringing them closer to Air New Zealand, the market leader.
- Auckland Airport expects more international flights as the next phase of border reopening approaches.
- The increase in flights between Australia and New Zealand enhances competition and consumer choice in the market.
- The New Zealand tourist industry may rely heavily on Australian visitors in the immediate future, although the return of visitors from other international markets will be helpful.
Summary:
- New Zealand allowed Australians to enter from 12-Apr-2022, as part of a phased reopening.
- Auckland Airport sets post-COVID traveller record due to holiday period.
- Qantas Group has bumped up its trans-Tasman flights, but Air NZ is still market leader.
- Auckland Airport is due to regain more international flights as next reopening phase looms.
Peak travel days are timely following NZ's reopening step
New Zealand's reopening to Australian travellers occurred on 12-Apr-2022, but the biggest travel day in the wake of this move was on 15-Apr-2022, with Easter weekend coinciding with the start of a school holiday period.
More than 10,000 international passengers either departed from or arrived at Auckland Airport on that day, said Scott Tasker, the airport's aeronautical commercial general manager. Another big day was expected on 1-May-2022 at the end of the school holiday period.
On the 15-Apr-2022 international passenger total was the highest since the beginning of the COVID-19 pandemic, reaching about 30% of pre-pandemic levels, Mr Tasker said.
Capacity changes in the Australia-Auckland market illustrate the increase in flights during Apr-2022. For the week of 25-Apr-2022, two-way departures reached 35% of 2019 levels.
While passenger numbers may have hit a two-year high on 12-Apr-2022 - which was a peak travel day due to holidays - flight numbers have not quite reached the levels of mid-2021. Last year's brief mini-recovery was spurred by a travel bubble that was established between the two countries, when both countries were almost COVID-free - although it was shelved due to the onset of the Delta variant.
Australia to Auckland, weekly two-way departures, 2020 to 2022 (YTD)
Qantas Group airlines move back into trans-Tasman market
Qantas and its Jetstar subsidiary have significantly boosted their flights to New Zealand due to the latest reopening measure.
They scheduled 23 one-way Australia-New Zealand departures for the week of 11-Apr-2022, up from just two per week in mid-Mar-2022. By the week of 25-Apr-2022 they had 35 combined one-way departures. These were predominantly from Australia's east coast capitals to Auckland, although those airlines also operated flights to Christchurch.
This brought the Qantas Group closer to Air New Zealand, which had already increased its trans-Tasman services.
Air New Zealand is the market leader, with a 62.2% share of capacity between the two countries, illustrating the importance of the market to the airline and to New Zealand. Virgin Australia is yet to resume its New Zealand flights and has indicated that it will start with flights to Queenstown in Nov-2022.
Australia-New Zealand weekly one-way departures, by airline (only Australian and NZ airlines shown), 2020 to 2022 (YTD)
The increase in flights by Qantas and its Jetstar subsidiary is an "important dynamic" as it means airlines from both countries are now regularly flying the main city pair routes, Mr Tasker said. This increases competition and consumer choice, which is particularly vital in a high-traffic market such as Australia-New Zealand, he said.
Passenger demand already appears stronger than during a short-lived travel bubble that was established between Australia and New Zealand in 2021. There was an imbalance in demand during the travel bubble period, with bookings originating from New Zealand much lower than those from Australia. Some of this reluctance to travel was due to the potential for short-notice flight suspensions.
Mr Tasker said there is no such imbalance evident this time, and New Zealanders are already proving they are eager to book flights to Australia.
"It is a very different situation than last year", he said. "Everyone has more confidence that the border settings are more stable."
Auckland's international traffic will grow as more reopening moves occur
Despite the growth in Australian travel, Auckland Airport's overall international volume is still down significantly. The airport had 15 airlines serving 25 international destinations as of mid-Apr-2022, versus nearly 30 serving 43 destinations before the pandemic.
International services are set to increase in the coming months, said Mr Tasker. Some overseas airlines are planning to resume their routes to New Zealand, while others are adding flights or frequencies.
"We're seeing some really positive signals and confidence on the airline side", said Mr Tasker. This will help spur "a recovery in capacity, competition and network".
The airline moves are partly prompted by the next phase of New Zealand's border reopening.
From 2-May-2022 vaccinated travellers from countries that have visa waiver agreements with New Zealand will be allowed to enter quarantine-free. This includes major markets for New Zealand such as the US, Canada, the UK, Singapore, Japan and South Korea.
Travellers from countries without visa waiver arrangements will have to wait longer. The New Zealand government has indicated that it will reopen to these countries from Oct-2022, although no exact date has been set. Some other important markets are in this category, such as China, India, and many other countries in the Asia-Pacific region.
Trans-Tasman travel should continue to pick up faster than long haul
The climb in flight numbers and passengers in the New Zealand-Australia market is set to continue, and frequencies will likely soon surpass the levels from last year's travel bubble. The travel environment has indeed changed significantly since then.
All signs are that the two governments do not expect to have to step back in and tighten flight restrictions again - which will make booking trans-Tasman travel less risky.
It also helps that both countries are increasingly treating COVID-19 as endemic, and there will be no return to an elimination strategy. Greatly reduced community restrictions make both markets more attractive for tourism.
Of course, the remaining testing requirements will deter some travellers. But travel between Australia and New Zealand will still have fewer complications than markets further afield, making trips across the Tasman more attractive.
So while the impending return of visitors from other international markets will be helpful, the New Zealand tourist industry may find itself highly reliant on Australians for the immediate future.