KEY POINTS:
Air New Zealand has given up on plans to pursue a code-share agreement with Qantas.
The proposal for the two airlines to share services on the Tasman route was knocked back by the Australian Competition and Consumer Commission (ACCC) in a draft decision this month. At the time Air New Zealand indicated it would attempt to appeal against the decision.
But chief executive Rob Fyfe said yesterday that after reviewing the decision the airline now had "little confidence it could get a positive final outcome".
"So we're better off withdrawing our application and redeploying our resources," Fyfe said.
The airline had previously indicated that it might be forced to reduce capacity on the Tasman if the code-share was not approved.
On the day of the ACCC draft decision, chief financial officer Rob McDonald said it was "potentially forcing Air New Zealand to make capacity and route decisions that will come at a significant cost to consumers".
Fyfe said yesterday there had been no decisions made on that issue.
However, it was clear something had to be done to address the profitability of the route - which accounted for about 20 per cent of Air NZ revenue.
"We haven't got a master plan that is about to be rolled out tomorrow," he said. "We still have a series of routes across the Tasman that are very poorly performing for us. We will now have to review how we address those issues."
Qantas also confirmed yesterday it would no longer pursue the proposal.
