The market fortunes of New Zealand's two biggest transport companies took dramatically divergent paths yesterday.
Air New Zealand A shares plummeted to a two-year low while Tranz Rail powered ahead.
But while Air NZ was being battered, Tranz Rail's shares benefited from analysts' predictions of cost savings and revenuegains from changes to its Cook Strait ferry service and the demise of a competitor.
Tranz Rail shares closed at 365c, up 14c for the day, after rising 11c the day before.
This followed news of plans to replace an older, conventional freight ferry with a fast ferry able to carry commercial vehicles. The new ferry will operate year round, although on a reduced daily schedule because of speed restrictions.
Tranz Rail will capture at least $12 million a year from rival TopCat and will regain "pricing power" as the need to discount prices to win business diminishes, said brokerage firm Salomon Smith Barney.
Replacing the older ferry would save the cost of improving it, and the reduced schedule would cut costs.
