Some Air NZ domestic flights cost hundreds of dollars more than competition as holidays loom

Last-minute flights are more expensive than ever with some costing more than $1000 return. Photo / Brett Phibbs

Some domestic flights on national carrier Air New Zealand have surpassed $1000 return in the lead-up to Christmas - up to twice the competition.

Refundable tickets for certain flights from Auckland to Dunedin this week were up to $510 one-way compared to similar flights on Australian-owned Jetstar that were hundreds of dollars cheaper.

The price dropped dramatically if booking ahead to February or March, with Air NZ flights down to $181.

At the time of publication, Jetstar had some pre-Christmas one-way tickets from Auckland to Dunedin for $199. The cheapest Air NZ seat-only flight was $272.

A return flight to Queenstown from Auckland left a little more money in the bank, with Jetstar priced at $344 return and Air NZ at $513.

Seat and bag travel between Auckland and Wellington was the only flight found where Air NZ had a cheaper option, with $361 return compared to $370 for Jetstar.

Prices for domestic flights jumped in November, climbing to three times what they were in July. As the summer holidays approach, they have risen further still.

The high cost of domestic travel could mean passengers look to go overseas instead.

Flights around New Zealand in the lead-up to Christmas are comparable to international flights to Honolulu, Rarotonga and Australia if taken in early 2023.

This week, Air NZ had Grabaseat fares to Hawaii for $1000.

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Hawaiian Airlines offered the same direct flight around the same timeframe for $1241. There were cheaper ways of getting to Hawaii but it would take almost three times as long to get there.

Flying Auckland to Honolulu with Fijian Airlines would cost a bargain $955 return, but the flight (usually just over eight hours direct) would take 31 hours with two stops along the route.

Air NZ wouldn’t comment on the price difference between its flights and Jetstar’s, saying it wasn’t in the position to “talk about the pricing strategy of another carrier”.

Consumer NZ said the price hikes were staggering and served as a big warning to travellers to shop around, be flexible with dates and book early.

The cost for a family to fly to see relatives for the holidays can easily add thousands to the budget at a time the cost of living is hurting households.

Prices were so high some people would either not travel or look for alternative transport such as trains and buses.

The great Kiwi road trip may also be staging a comeback, with the relative affordability meaning people reach for their car keys instead.

Packing the family into the car and driving the length of New Zealand is a cheaper alternative for those on a budget. Photo / 123rf

“With the cost of last-minute airfares likely to be a barrier for many New Zealanders, we could see more people opting for road trips instead,” said Jessica Walker from Consumer NZ.

“Unfortunately, for people who need to travel over the holiday season, the flight prices are staggering.”

Consumer NZ recommended people be flexible with their time and date of travel and to book as far ahead in advance as possible.

Using a price comparison site was also a useful tool in comparing dares.

“However, anyone booking this close to the holiday period is going to be paying top dollar for their seat.”

Consumer NZ research revealed with the cost of living increasing on every front, people were finding it difficult to save.

Despite this, around 37 per cent were prioritising saving for travel and holidays.

“The number of people regularly saving is on the decline, but our research shows people saving are prioritising funds for a well-earned break rather than things such as TVs, electronics or vehicles.”

Air NZ chief executive Greg Foran said in an earlier interview the reduced fleet was to blame for the higher prices.

The national carrier was hoping to reduce the cost of fares with more planes on the way.

Two new domestic A321neos arrived in November and a third was expected in early 2023.

With more planes, prices would start to moderate, he said.

Iain Walker, the airline’s general manager domestic, said booking early ensured a better fare price.

Last week he laid out for the Herald exactly how prices were set.

On domestic travel there was a range of 15 price points. For example, a year out from travel between Auckland and Napier, flight prices range from $59 to $356. There might be five seats at $59, five at $69 all the way up to $356 for the last three seats.

As the plane was booked, the cheapest seats sold first and so the price of seats went up over time.

Walker said the $356 seats were often not sold but this year was different and demand was higher.

One to two months ago, the average fare to travel around Christmas was around $150 but customers had been getting the message to book early and the fights had been filling up.

The number of seats this month is on the same level as before Covid hit - but there is higher demand.

Consumer NZ said despite the current high prices for travel, its research revealed the majority of people trusted airlines.

“We found 47 per cent of people we surveyed said they trusted the airlines, and 23 per cent don’t trust the airlines,” Walker said.

“While these figures indicate trust is high – this could be reflective of people feeling airlines are safe and reliable, not necessarily providing a fairly-priced service.”