Australia's Qantas, Air NZ plan code share agreement on Tasman route

SYDNEY (XFNews) - Australia's flag carrier Qantas Airways Ltd and Air New Zealand announced they have signed a code share agreement for their Tasman routes between the two countries.

The airlines said they will shortly file applications to the Australian Competition and Consumer Commission (ACCC) and to the New Zealand Minister of Transport for regulatory approval which is expected to take six months.

They said the proposed plan will benefit consumers through better loyalty program advantages, an improved spread of flight schedules and connections to onward flights, as well as the retention of low fares.

Air New Zealand chief executive Rob Fyfe said the Tasman route is a fiercely contested market, noting the number of seats on sale is greater than the number of passengers carried.

"In fact the equivalent of 11 empty A320 aircraft make two return trips per day. To continue such over capacity in the present environment of high fuel prices would not only be uneconomic, it would be financially and environmentally irresponsible," he said.

"The reality is that both Air New Zealand and Qantas continue to compete against a significant number of other airlines on the Tasman. Both airlines would also remain vigorous competitors in marketing and distribution."

The proposed codeshare will be supported by revenue, pricing and scheduling arrangements, with revenue allocated on an agreed basis while each carrier will benefit from its own cost reduction programs and continue to maintain independent and competitive relationships with travel agents.

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