Flights in and out of the Bay of Plenty just got a whole lot cheaper, exciting business leaders, politicians and residents.

The airline has shrunk its lowest fares for 41 domestic routes around the country, as part of the biggest overhaul of its domestic pricing structure in more than a decade.

From today, fares between Rotorua and Auckland now start at $39, Rotorua and Wellington fares are available from $49 and it's now $59 one-way between Rotorua and Christchurch.

Fares between Tauranga and Auckland will now start at $39, and flights from Tauranga to Wellington at $49.

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Tauranga Airport. Photo / File
Tauranga Airport. Photo / File

The prices apply to trips from March 25 onwards.

Rotorua Airport chief executive Mark Gibb said the reductions were significant.

"Affordability of regional flights has been on the table for a good 1.5 years now with Air New Zealand. We have seen a growing gap between prices for the big cities as opposed to the regional airports, and that created all sorts of issues."

He said it was great news to see the problem addressed.

"It means we have a level playing field."

Air New Zealand staff wave goodbye to a flight. Photo / File
Air New Zealand staff wave goodbye to a flight. Photo / File

Gibb said some Rotorua residents drove to Auckland to fly because it was cheaper.

"For example, it was cheaper to drive to Auckland and fly from there to Queenstown than go Rotorua to Christchurch, then Queenstown. Hopefully, the dropped prices will remove people off the roads."

He said Air New Zealand head of tourism and regional affairs Reuben Levermore had visited Rotorua Airport two weeks ago, and the price gap problem was discussed, so today's announcements were not a huge surprise.

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He said the timing of the price drops would make the airport busier than normal during the winter period.

Destination Rotorua chief executive Michelle Templer. Photo / File
Destination Rotorua chief executive Michelle Templer. Photo / File

Michelle Templer, chief executive of economic development organisation Destination Rotorua, said the cost of flights was an important consideration for many domestic travellers.

"We welcome any initiative that strengthens links between Rotorua and our key domestic markets of Auckland, Wellington, and Christchurch."

Rotorua Mayor Steve Chadwick held a similar view.

Rotorua mayor Steve Chadwick. Photo / File
Rotorua mayor Steve Chadwick. Photo / File

"The lowest fares don't apply for all flights but I'm sure that many Rotorua residents, and visitors to Rotorua, will take advantage of the new prices on these key routes to and from our city."

Waiariki MP Tāmati Coffey congratulated Air New Zealand on making the "long overdue change".

"While Air New Zealand is an independent entity and this is an independent decision, this Government is committed to revitalising our regions and has previously made public statements advocating for changes to fares within Aotearoa. We needed to make it more affordable to connect whānau in this country."

Waiariki Labour Party MP Tamati Coffey. Photo / File
Waiariki Labour Party MP Tamati Coffey. Photo / File

He also hoped the increased access into the regions would mean "we can also relook at linking Whakatāne back into their network and re-explore the potential of the Rotorua to Queenstown link".

He said both were crucial to creating future jobs in the Waiariki electorate.

Rotorua MP Todd McClay agreed the lower prices would allow more residents and visitors to travel by air.

He hoped the price reductions would eventually be seen across the board.

"So instead of picking and choosing flights across the day, we need to see lower fares on every single flight."

National Party MP Todd McClay. Photo / File
National Party MP Todd McClay. Photo / File

McClay also hoped a business lounge, similar to one at Tauranga Airport, would be considered for Rotorua.

In his opinion, Rotorua also needed a jet service to Christchurch.

"Some international visitors don't like the smaller planes. Even just one jet flight a day would see international visitors jump."

Bay of Plenty Tourism chief executive Kristin Dunne said the organisation had been working with Air New Zealand to increase leisure travel into the Bay of Plenty for a while.

"That market is not business travellers. They could afford the fares as they were, but to increase leisure travel we needed more seats and to be more price-conscious."

Kristin Dunne, chief executive of Tourism Bay of Plenty. Photo / File
Kristin Dunne, chief executive of Tourism Bay of Plenty. Photo / File

She said the organisation had been campaigning to bring more visitors from Christchurch and was soon to do this with Wellington too.

Nigel Tutt, economic chief executive of development organisation Priority One, said connecting with other cities was important for the business community.

"Prices in the past have been a sore point so this will make it easier to get around. The business community has been pretty vocal about that so it's good to see they've been heard."

Priority One chief executive Nigel Tutt. Photo / File
Priority One chief executive Nigel Tutt. Photo / File

He said he hoped the prices would be sustainable in the long-term but "the proof will be in the pudding".

Tauranga Chamber Of Commerce chief executive Stan Gregec said the price changes were fantastic news.

"Combined with the extra services that were added into Tauranga by Air New Zealand recently, it should see a huge boost in domestic air travel in and out of Tauranga."

He added: "With the upgraded airport and other recent improvements to services, Tauranga will now be a much more attractive and affordable destination for many."