Australian airline Ozjet has proposed initially operating four days a week from Brisbane and Sydney to Palmerston North.
It has applied to move into the trans-Tasman vacuum created by the departure of Air New Zealand subsidiary Freedom Air from the end of March, The Australian newspaper reported today.
Ozjet wanted unlimited capacity to operate a two-class Boeing 737-300 service on the route for three years.
The airline said more than a quarter of the New Zealand population lived within 200km of Palmerston North.
"The wider community of the region centred on Palmerston North has experienced the convenience of services for 12 years and places considerable value on the availability of international links," it said.
"The Australian community has progressively increased its use of the services as a convenient and easy link into central New Zealand and for the first six months of 2007 the number of Australian passengers on the Sydney-Palmerston North sector exceeded the number of New Zealand passengers."