A domestic air fare war is underway, after Qantas low-cost carrier announced it would launch new routes to regional New Zealand.

Jetstar is using $9 fares to promote the unveiling of Nelson, Napier, New Plymouth and Palmerston North to its regional network. Air NZ responded immediately, matching the $9 fares on its 'grabaseat' website.

It's expected that the new competition between the airlines - previously restricted to the destinations of Auckland, Wellington, Christchurch and Queenstown - will bring air fares down for a range of regional destinations.

Increased web traffic on the back of the airline's announcement of super cheap regional air fares caused the Jetstar website crashing this morning.


The system crashed for a period of time but came back online about 10.30am, a Jetstar spokesman said. "We did have our website crash this morning due to a server issue.

"We've seen really, really huge demand for the sale fares and all fares since it's come back online."

The sale has been extended to ensure customers can access the cheap fares for as long as originally planned, the Jetstar spokesman said.

Nelson-Auckland and Napier-Auckland flights would start the beginning of December, in time for the tourism season in both popular holiday destinations.

Jetstar boss - this is not about revenge
Jetstar readies for fare war

New Plymouth-Auckland, Palmerston North-Auckland and Nelson-Wellington flights will follow early next year, with services scheduled to begin from February 1 next year.

Jetstar's chief executive for Australia and New Zealand, David Hall, said the company was delivering on its commitment to bring low fares and increased competition to communities around the country, kicking off with a special $9 one-way launch fares.

"In the past several weeks our New Zealand management team has travelled to eight regional centres and received a warm welcome and very positive support in every city we've visited," Hall said in a statement.

The Qantas-owned low-cost airline said in June that it was going to expand into the regions. Cities being considered included Hamilton, Rotorua, New Plymouth, Napier, Palmerston North, Nelson and Invercargill.

After lobbying from regional mayors, airports and tourism promoters, the airline this morning announced the winners.

Economic potential and the ability to support two airlines are the main criteria for choosing the destinations, to be served by five 50-seater Bombardier Q300s, with the first flights planned for this year.

"For us to go into the regions, we have to know how we can bring growth. It's not about going in and taking a part of the pie that's already there," said Jetstar's New Zealand head Grant Kerr.

Tourism industry says Jetstar move good for regional 'dispersal'

Tourism Industry Association chief executive Chris Roberts said Jetstar's foray would undoubtedly directly stimulate travel to the four selected destinations.

"Competition is always good and it's welcome that there's now a significant regional network as [an] alternative to Air New Zealand.

"For the first time in some time we have a significant alternative choice for consumers."
The move would result in more tourists travelling to the regions "simply by the fact there'll be more seats available and more competition on prices," Roberts said.

"Tourism is on a high at the moment, it's growing very strongly and a key to future growth for New Zealand is regional dispersal - getting visitors all around the country - so any initiative that helps spread the visitors around is welcome news.

"This has significance for the international travellers as well, because for Qantas and its associated alliance airlines, they now have a regional network within New Zealand that can be included in itineraries, whereas previously they were restricted as to where they could take the visiting international traveller to - often it was only as far as Auckland and then the traveller had to switch to Air New Zealand or make other travel arrangements."

Jetstar move 'payback' says Air NZ

Air New Zealand chief executive Christopher Luxon said last week that Jetstar's entry into the regional market was partly payback for his airline's entry into Australia.

Luxon said the Jetstar regional move was more of a "macro-strategic" play.

"Qantas was quite bruised by Virgin Australia taking it on. It's a little bit of this is payback for challenging them in their home market."

Jetstar was able to access spare five Qantas group aircraft sitting on the ground and put them to use here.

The arrival of Jetstar's 50-seat Q300 aircraft in New Zealand wasn't "something we should get too freaked out about." Luxon said.

"Having said that great there is choice for customers across the country and it's great there is competition."

Other smaller airlines were also flying to towns Air New Zealand had pulled out of earlier this year (Kaitaia, Whakatane and Westport).

Luxon said Air NZ was spending $300 million upgrading its regional fleet over four years, upgrading to 68-seat ATR planes which would give it cost advantages over Jetstar.

"I feel really comfortable with our ability to compete there. We need to keep it (the Jetstar regional service) in perspective I think it's been a bit overblown to be honest with you."

Regional mayors welcome Jetstar's arrival

Hawke's Bay Tourism general manager Annie Dundas said the decision was "huge news" for the region.

"It's a complete game-changer for tourism growth opportunities. Competitive airfares are good for domestic tourism but this will also open up international connections to Australia too."

The mayors of Napier and Hastings said the result was the ultimate reward for the regional team behind the pitch.

"This is simply wonderful," said Napier Mayor Bill Dalton. "The team worked hard and showed Jetstar we are a region on the up with plenty of untapped potential."

Hastings Mayor Lawrence Yule said it was a long-awaited prize.

"The only way to substantially reduce the price of airfares for the people of Hawkes Bay is by competition. It is very exciting that we have landed a large player."

Business Hawke's Bay chief executive Susan White welcomed a second "sustainable carrier" servicing the region.

"We are convinced this will contribute to the growth of our regional economy and we look forward to the expansion of routes over time."

With expansion plans already underway, Hawke's Bay Airport chief executive Nick Story said the timing couldn't be better. "It's a very exciting day for the airport company and a great day for the Hawkes Bay region."

Hamilton 'disappointed' at Jetstar news

The Hamilton city council says it is "disappointed" at Jetstar's decision not to make the city one of its new destinations.

The airline today announced would add Nelson, Napier, New Plymouth and Palmerston North to its regional destination network, starting from December this year.

Hamilton mayor, Julie Hardaker, said it had come as a surprise that neither Hamilton, Tauranga nor Rotorua had made the cut.

"We put forward a very strong proposal and a compelling case but in the end they made a decision to go with four others.

"Between the Bay of Plenty and the Waikato, we are a very strong economic performer and contributor to New Zealand so we have lots of commercial and business travel.

"In addition to that, we are the gateway to some of New Zealand's most popular and largest tourist destinations like Hobbiton and the Waitomo caves and Rotorua itself is a tourist destination so I think there is a bit of a surprise there," Hardaker said.

"Collectively the Waikato and the Bay of Plenty make an enormous contribution to New Zealand, both from a visitor and tourism perspective but also from an economic perspective."

Hardacker said Jetstar had not given the council any indication of why their proposal had failed.

"Some of the things that I think about is the proximity to Auckland where people do have a choice to fly domestically in Auckland when the Air New Zealand flights in Hamilton don't suit," she said.

"I think the other thing that appears to have influenced their decision is the route network planning that has to be done. They only have five planes, they don't have a full fleet so the proximity of the totem four says there has been a lot of consideration of network planning and maximising that."

Despite the announcement, Hardaker said there was no expectation for tourism in Hamilton to be negatively affected.

"We have never had Jetstar flying into Hamilton or Rotorua so I don't expect that it will have any impact," she said.

"I think the value of having Jetstar is that it brings competition and that affects price and it affects flexibility and those things are very good for visitors and economic performance so I think for us, if Jetstar had announced that we were going to be one of the initial four, I think we would be in there looking for initiatives to wrap around that to grow our tourism and visitor market and also looking at how that links into continuing to grow our economic performance."

While some regions have been disappointed by this morning's announcement, other parts of the country have relished the news.

Nelson mayor Rachel Reese said the city would be celebrating today after it was announced as one of Jetstar's four regional destinations.

"Our city has an ever increasing demand for air travel, and a new airline will add that additional capacity so more people can come and experience what our city has to offer," Reese said.

"We saw our residents really get in behind the campaign to bring Jetstar to our city, and so there will be a lot of people celebrating this news today."

Reese said the move would boost Nelson's economic and tourism sectors.
"Enabling more domestic, business and tourism customers to fly into Nelson will have a significant economic benefit for the region, opening up new markets and increasing connectivity."


What are the new regional flights offered?

Nelson-Auckland, Napier-Auckland, New Plymouth-Auckland, Palmerston North-Auckland and Nelson-Wellington.

When do they start?
Nelson-Auckland and Napier-Auckland flights will start from December 1 and the New Plymouth-Auckland, Palmerston North-Auckland and Nelson-Wellington flights will start from February 1, 2016.

How often will they occur?
There will be four return flights a day to each new destination except Wellington-Nelson, which will have three return flights a day.

How much will they cost?
Yesterday they were launched at $9 each way as a promotion. The next stage of the sale will involve $25 tickets one way for selected periods in December, February and March (this sale finishes at midnight tonight). After that the average fare varies from destination to destination and time of the week. Looking online last night at April 2016, adult fares one way were:

Price range for Nelson-Auckland: $39-$59
Price range for Napier-Auckland: $49-$69
Price range for New Plymouth-Auckland: $39-$45
Price range for Palmerston North-Auckland: $39-$49

How many tickets sold yesterday?
At 4pm yesterday, Jetstar said more than 15,000 $9 fares had been sold across the five new flight options.

- Additional reporting: Regan Schoultz, Brendan Manning, Hawkes Bay Today