Return economy fares to Europe have dropped below $1000 in deals this weekend and the growing move by Kiwis to premium travel will be boosted by business-class fares for under $4000.

Limited Air China flights to Rome will sell for $999 at Flight Centre's Travel Expo for travel in the three months from March.

And China Southern Airlines is offering business class to popular European entry port, Amsterdam, for $3999 from May to mid-November. Business-class fares have often been double that, although have been falling during the last two years.

China Southern also has return flights to London, typically the most expensive place to fly into Europe because of government taxes, for $1249 return a person for travel in the same period.

Advertisement

Both Chinese airlines are large state-owned carriers, and mainly operate modern Boeing 777 and 787 Dreamliner aircraft on their long-haul routes.

Hot competition between airlines pushes down promotional air fares but fuel prices are looming as a threat to standard fares.

Flight Centre's general manager product Sean Berenson said there were signs of regular fares edging up, matching oil price rises over the last year.

At this weekend's Auckland expo the agent is also offering Hawaii return fares for $739 on Hawaiian Airlines and $799 on Air New Zealand as the two carriers scrap it out on what will be a battleground route this winter as both put on more flights.

Los Angeles on Air New Zealand for seven months from May is selling for $899 return.

China Southern is offering $3999 business-class fares to Amsterdam. Photo / Grant Bradley
China Southern is offering $3999 business-class fares to Amsterdam. Photo / Grant Bradley

Flights on China Southern to Vietnam start at $619 and Tokyo $749.

Berenson said with the marked increase in affordability and accessibility, and a rise in carriers flying to New Zealand that offer more premium services, travelling in premium cabins was no longer the "bucket list" style of travel it once was.

While Flight Centre doesn't disclose customer numbers, during the past three years the number of passengers booked on first class cabins by the agent was up eight times while last year the agent booked 15 per cent more into business class.

Expo deals: Travel for set periods and on selected dates
Europe
•Rome: $999 economy return on Air China
•London: $1249, economy on China Southern Airlines
•Amsterdam: $3999 business class on China Southern
North America
•Hawaii: $739 economy return on Hawaiian Airlines, $799 on Air NZ
•Los Angeles: $899 on Air NZ
South Pacific
•Fiji: $549 on Air NZ
•Rarotonga: $469 on Virgin Australia
Asia
•Vietnam: $619 on China Southern
•Phuket $625 on China Southern
Bali: $799 on Air NZ
Australia
Melbourne, Sydney or Brisbane $399 on Air NZ


Further back in the plane Flight Centre had seen a ''notable increase'' in upgrading, opting for deluxe economy fares.

Air New Zealand's efficient fleet helps it as fuel prices rise. Photo / Grant Bradley
Air New Zealand's efficient fleet helps it as fuel prices rise. Photo / Grant Bradley

Berenson said Kiwis were travelling further afield or looking for "off-the-beaten-path" destinations close to home. This was reflected in more travel to destinations such as Africa - up 10 per cent last year on 2016, the Middle East - up 29 per cent compared to 2016 and South America up 5 per cent.

The Flight Centre Europe fares are among the lowest offered.

While Philippine Airlines flights on sale last year dropped as low $979 these involved two stops and a $999 deal offered last month by another agent for travel on Air China to Zurich required passengers to buy accommodation or other travel.

The future for airfares

What's been pushing down prices?

While the number of new airlines hasn't increased at the same rate as a year ago, there remains a record number of international seats to fill so airlines and agents are in a cut-throat battle. Air New Zealand, which carries the most traffic to and from this country is boosting capacity to a number of Pacific Rim destinations so that hot competition will continue. A mainland Chinese carrier is investigating a route from another secondary city and Air Canada is understood to be scoping this market. Record airline capacity is driven mainly by inbound tourism and this shows no signs of dropping off. Airlines with new-generation aircraft that burn less fuel can tolerate current increases in fuel prices far easier than in the past. Airlines' adoption of booking and customer technology, mergers and reduced staff numbers mean they are more nimble and able to compete on price.

New trends for travellers

More are enjoying the good life at or near the front of the plane as business class and premium-economy options expand and promotional deals hit the market. Flight Centre also says more economy passengers are opting for the extras such as meals and bags.

Read more: Why business class is booming

What's the outlook?

Cloudy. If all the existing carriers keep flying here expect more great promotional deals. But airlines with less efficient aircraft or with options to fly more lucrative routes could review their operations. Macquarie research just out says Air New Zealand, which operates a more efficient fleet than most of its competitors, would have to lift long-haul fares by up to 5 per cent to cover increases in spot fuel prices. Emirates' withdrawal of flights across the Tasman from Auckland in March will mean fewer seats overall and could push up prices. And while this week's financial market gyrations have happened despite largely strong world economic performance, any deep and prolonged drop in confidence can affect discretionary spending on travel, especially by businesses.