In a move to redefine the travel experience between Australia and New Zealand, the Australian Competition and Consumer Commission (ACCC) recently announced a groundbreaking draft determination.
This proposal entails authorizing industry giants Virgin Australia (VA) and Air New Zealand (NZ) for unilateral code-sharing arrangements on trans-Tasman routes.
ACCC on Virgin Australia and Air NZ Codeshare
Virgin Australia (VA) and Air New Zealand (NZ) are seeking authorization for Virgin Australia to display its airline code on trans-Tasman routes operated by Air New Zealand (NZ), specifically targeting routes sold in Australia and originating from Australia (VA-coded trans-Tasman services).
Under this arrangement, Air New Zealand (NZ) will stipulate the fares at which Virgin Australia (VA) may market and resupply these itineraries.
“This proposed code-sharing arrangement has the potential to increase ticketing choices for Australians traveling to New Zealand and provide Velocity frequent flyer program benefits and international lounge access for eligible Virgin Australia customers,” stated ACCC Deputy Chair Mick Keogh, emphasizing the customer-centric advantages of the collaboration.
A Win-Win Situation
ACCC Deputy Chair Mick Keogh further added that,
Beyond enhancing ticketing options, the partnership between Virgin Australia (VA) and Air New Zealand (NZ) promises many benefits for businesses and travelers. Jointly, they can offer discounts and marketing incentives for VA-coded trans-Tasman services, further enriching the travel experience.
It’s important to note that the proposed arrangements exclude routes where Virgin Australia (VA) currently operates its own services, such as those between Queenstown and Melbourne, Sydney, and Brisbane.
Additionally, the ACCC acknowledges concerns regarding potential upward pressure on airfares due to increased demand for Air New Zealand’s (NZ) trans-Tasman services. However, ACCC Deputy Chair Mick Keogh assures that such concerns are being actively addressed and mitigated.
In a proactive move, the ACCC has granted interim authorization to allow Virgin Australia (VA) and Air New Zealand (NZ) to commence commercial planning for marketing and selling fares for VA-coded trans-Tasman services. However, direct or indirect marketing, provision of offers, and fare sales to all customers remain restricted pending the ACCC’s final determination.
As the proposal enters the public domain, stakeholders and interested parties are invited to submit their feedback and insights by 8 May 2024. The ACCC will carefully consider all submissions before making its final decision.
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