First the Virgin Australia deal, next a new competitor from Hong Kong.

Hainan Airlines has suddenly moved squarely into Air New Zealand's sights from two directions - and neither move is welcome.

The surprise move by Hainan Airlines' owner HNA Aviation to buy 13 per cent of Virgin Australia complicates Air New Zealand's attempt to extricate itself from an increasingly complicated investment across the Tasman. The less surprising decision by Hainan subsidiary, Hong Kong Airlines, to fly to Auckland is a direct challenge.

On Tuesday morning Virgin Australia warned the market of a major announcement regarding Hainan Airlines. From the outside it looked as if this would be the sale of part or all of Air New Zealand's 26 per cent stake to Hainan.

Far from it.

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While Air New Zealand had wind of a buy-in, Virgin Australia announced Hainan was spending US$114 million buying into the heavily indebted Australian carrier. Air New Zealand, whose chief executive Christopher Luxon resigned abruptly from the Virgin board in March when his airline said it was looking to quit its 25.9 per cent stake, was in the dark.

Virgin chief executive John Borghetti has said that Air New Zealand did not need to be consulted.

"We didn't lock them out, Air New Zealand is not on the board ... they weren't privy to the decision," he said.

The effect of Hainan buying in has diluted Air New Zealand's stake to 22 per cent. Even worse, Hainan bought in at A30c a share, implying that is a ceiling price for Air New Zealand's stake, which it has spent more than $400 million buying and maintaining since 2011.

Across the Tasman, analysts including Capa Centre for Aviation say the deal done with Hainan is a "considerable blow" by Virgin to Air New Zealand. But in Virgin's view the New Zealand airline initiated the situation when Luxon unsuccessfully called on Borghetti to resign, a move rejected by Virgin's chair.

Borghetti, asked whether issuing new shares to Hainan cannibalised Air NZ's stake sale, told Bloomberg: "They are two different things. The Air New Zealand stake, and what happens to it, is entirely up to Air New Zealand. We don't have a say or control."

Air New Zealand's not saying anything about the spat although Luxon yesterday said at the International Air Transport Association gathering of airline executives in Dublin that he wanted finality around the Virgin deal by the end of the month.

Finding a buyer for the stake has got harder. There's speculation the presence of Hainan in Virgin Australia may rule out a Chinese airline buyer such as China Southern, which has been mentioned before.

Air New Zealand and Virgin formalised an alliance in 2010 with codesharing agreements on transtasman and connecting flights and reciprocal frequent flyer and access to each other's lounges.

The financial stake provided further glue and was built up when Air New Zealand was unsure about Singapore Airlines' intentions in this region (although in the way of the fast moving world of airline alliances, Singapore and Air New Zealand have since done a deal).

While there's clearly friction at the top, Virgin Australia and Air New Zealand continue to work together at an operational level and are now re-negotiating their alliance deal.

One big reason they got close in the first place - Qantas - hasn't gone away.

The loss on the Virgin stake could exceed $100 million if Air New Zealand sold at A30c, but the effect of shoring up the Australian partner in its battle with Qantas is harder to quantify. Virgin was able to engage Qantas in a capacity war and while both airlines were harmed, it was the Flying Kangaroo that felt the most heat.

HNA is a sprawling conglomerate whose interests include not only airlines but tourism and shipping. In turn, Hainan Airlines is the biggest single shareholder in Hong Kong Airlines, which is going to cause Air New Zealand some pain on its Auckland-HK route by competing with daily services from November.

Air New Zealand is getting used to new airlines piling capacity into this country, attracted by the travel boom and enabled by low oil prices and new planes, and that is largely why its share price has been under pressure this year.

At the IATA meeting at the Royal Dublin Society complex there's a fair bit of discussion about Virgin, its new shareholder and where it leaves Air New Zealand. These gatherings are good natured affairs - on the surface at least - with lots of back slapping and banter.

Luxon's in Dublin but Borghetti isn't. Probably a good thing in the interests of keeping the craic flowing.