In a move that will surely disappoint Virgin frequent flyers, Virgin Australia has announced that Air New Zealand has given notice that it intends to end the seven-year Trans Tasman alliance that began between the two airlines in 2010.
Regulatory approval for the alliance expires at the end of October this year. Air New Zealand says the parties will not apply for renewal, officially separating itself from Virgin Australia following the sales of their 26% stake in the airline in 2016.
While John Borghetti said Virgin would maintain its presence above the Tasman and would consider also flying its budget arm Tigerair into New Zealand (which it couldn’t previously do under the alliance) this news doesn’t bode well for the Virgin Australia network. Not only will frequent flyers loose access to the lovely Air New Zealand lounge and key status earning, and points spending, on routes to the US and South America, Tiger is unlikely to woo consumers when compared to Air New Zealand’s fantastic Business Class Product.
Air New Zealand Chief Revenue Officer Cam Wallace says market dynamics on the Tasman route have changed.
“Australia is the largest source of inbound visitors to New Zealand and Air New Zealand has built up a significant presence in this market,” he says.
“This move will enable us to deliver a more consistent customer experience by using our own fleet and delivering an improved schedule, which we’ll provide more details about shortly.
“We remain fully committed to our other alliance relationships and our overall global airline alliance strategy as a critical success factor in other markets.”
Current trans-Tasman alliance arrangements will remain in place until October 27.
The airlines are working through arrangements for codeshare, scheduling, lounge access and frequent flyer programs.
Feature Image: Seth Jaworski