A Virgin Australia Boeing 737-800. Photo / Supplied
A Virgin Australia Boeing 737-800. Photo / Supplied
Virgin Australia will make more flights across the Tasman following its breakup with Air New Zealand, but says it will not need additional aircraft.
The airline says a fleet simplification programme that began two years ago was also aimed at more efficient use of its planes, including the 737-800s usedto fly across the Tasman.
When the seven-year partnership with Air New Zealand finishes at the end of October, the Australian airline will fly two new transtasman routes and increase the number of seats on existing ones, aiming specifically at the business market.
Air New Zealand is also stepping up its transtasman flights.
Virgin has more than 80 Boeing 737s. A small number of them need extra checks of their CFM engines following a global alert, but these will not affect schedules.
Virgin Airlines group executive Rob Sharp said the restructuring came as the mining boom ended. The airline's Embraer E-Jets have gone from the fleet.
''One of the core strategies is to use our 737-800s - the utilisation has historically been lower than what it could have been. We're not acquiring new aircraft but we're using capacity that we had within our fleet.''
The Australian airline says its transtasman capacity will increase by 13 per cent, with 43,000 extra seats from October 28.
Virgin Australia will start up to five flights per week between Sydney and Wellington, as well as up to four flights per week between Melbourne and Queenstown.
Auckland-Sydney flights will increase to three times a day during the week and twice daily on weekends, Auckland-Melbourne to twice every day and Auckland-Brisbane to two services, and up to three on peak days.
There will be a slight reduction on two other routes. Frequency between Christchurch and Melbourne will drop from 11 flights a week to a daily service, and Brisbane-Wellington from up to 14 services per week to nine.
Sharp said there would also be some reductions in flights to the Pacific Islands.
''We were very keen on Sydney-Auckland to hit the business market - that's a very time-sensitive market, likewise with Melbourne,'' he said.
''Given we're flying under our own brand, it made sense to have a full market view - we always felt Sydney-Wellington was a good business market.''
A Virgin Australia Boeing 737-800. Photo / Supplied
Air New Zealand is putting more flights into Brisbane, in what is a rebalancing move following the breakup.
Sharp said Virgin's capacity between Auckland and Sydney would increase by 50 per cent.
''Alliances generate some benefits but likewise this generates new opportunities for us. We're able to enter new routes which are beneficial for us - we're also able to get the frequency up, particularly for business traffic that's really important.''
Among reasons for Air New Zealand quitting the relationship was its own firmer foothold in Australia and its concerns about the consistency of products available across the joint venture.
Sharp said his airline would be announcing changes to what it offers on its aircraft from the end of October. The free food offer in economy is basic and this was under review.
''We're looking at upping the ante and we'll be announcing some products,'' Sharp said.
''It's an interesting market in that there's a very eclectic mix of offerings and my sense personally is that the market does find it a bit confusing - a buy-as-you-graze option is almost a low-cost carrier option.''
He said the airline would be assessing where it would position itself in the market. There is also logistical work to be done as part of the breakup. The airlines will negotiate which lounges eligible Virgin passengers can use in New Zealand (they have been using Air New Zealand lounges) and how frequent flyer schemes can be ended.
While Air New Zealand can use wide body Boeing 787s and 777s across the Tasman to complement its narrow body Airbus A320s, Virgin only has the single aisle 737s to use on the route. The aircraft have just eight business class seats but Sharp said it was an appropriate aircraft.
''It allows frequency in a market that is quite volatile. Being able to flex capacity really allows you to deliver a sustainable proposition. From a commercial perspective it's a good aircraft.''
He said the new wave of competition would keep pressure on prices and there would be some promotional deals.
However, he was not keen on ''low ball pricing'' to buy market share.
''We believe we've got a good product for a fair price - there's always a danger that you come in and reset all the pricing in the market and that's not the direction we're heading in.''
After the bust-up •Virgin Australia and Air NZ will fly more across the Tasman •Virgin will introduce new products, including food •New lounge and frequent flyer arrangements must be worked out •Virgin says its 737s are the right planes for the Tasman
