What others think of the airline deal

Virgin Blue:


Budget carrier Virgin Blue has moved its sights away from New Zealand as its likely first overseas destination.

Head of commercial operations David Huttner said Virgin Blue would "vigorously" oppose an alliance between Air NZ and Qantas when the New Zealand Commerce Commission and the Australian Competition and Consumer Commission called for submissions.

Virgin Blue, which entered the Australian market two years ago, is looking to expand into the Asia-Pacific region, with the first service expected to start about the middle of next year.

"New Zealand was likely to be our first international destination," Mr Huttner said. "In the present environment, we are reconsidering that view."

He added: "We plan on opposing this deal as it is clearly selling out tourist and consumers' interests in New Zealand. It is creating a behemoth out of Air NZ's dominance coupled with Qantas' ability to spend lots of money to block out competition."

He said a Virgin Blue team was in New Zealand last week, meeting representatives from five airports, both major and regional, and received a positive response.

"There's clearly a will and enthusiasm to get us in there, but we are not going to go in blindly and throw our money down the hole."

Mr Huttner said the New Zealand public could expect higher prices and fewer services under the Air NZ-Qantas agreement.

"Qantas is running a loss-making operation domestically in New Zealand to bring Air NZ to the table and they've done that now.

"Ten years from now, New Zealanders will be changing planes in Sydney to get to destinations around the world, and they will wonder why."

Exporters:


Exporters fear the Qantas-Air NZ deal will increase the cost of trade with Australia, New Zealand's largest export market.

Export NZ said it was concerned that the Qantas shareholding in Air NZ would reduce competition in the domestic and transtasman market for freight and passenger air fares.

Increasing costs would cut exporters' competitiveness.

The organisation, anxious that Australian business already had the ability to "tilt the playing field" in its favour, urged the Government to first finish the review of the CER agreement before accepting the Qantas investment.

Travel agents:

The Travel Agents' Association says it has concerns about a lack of competition that would result from the deal.

President James Langton said the association was worried about the implications of Air NZ managing the two airlines' operations to, from and within New Zealand.

"The tails of the aircraft might be red, but Air New Zealand is calling the shots in marketing, pricing, scheduling, you name it."

It was also a concern that Virgin Blue had said it would not come to New Zealand if a Qantas-Air NZ deal happened.

Tourism Industry Association chief executive John Moriarty said it was vital to retain Air NZ's national identity.

"The tourism industry and the public will expect Qantas and Air NZ to demonstrate - frequently - that their efficiency and pricing is world class, otherwise we put our domestic air services network at risk."