Airline competition hotter than ever - veteran

DUBAI, DUBAI - NOVEMBER 09: Airbus A350 performs during is displayed during the Dubai Airshow on 9, 2015 in Dubai, United Arab Emirates. (Photo by Victor Fraile/Power Sport Images/Getty Images)

A veteran of the New Zealand long-haul airline market says he's never seen it so competitive and it is set to heat up as the government seeks new deals that could lead to more services.

Cathay Pacific country manager Mark Pirihi said there had never been so many options for travelers amid fierce competition.

"It's just getting stronger and that's reflected in the amount of capacity coming into New Zealand."

His own airline is introducing the world's newest widebody plane to this market later this year but now faces competition from another Middle Eastern carrier, Qatar Airways, which will begin direct services from Doha to Auckland in December.

Already this year Emirates has started daily direct flights between Dubai and Auckland, Malaysia's AirAsia X is weeks away from flying from Malaysia via the Gold Coast to this country, US carriers United and American Airlines will resume flying across the Pacific to this country in the middle of the year and Singapore Airlines will fly from Wellington to its home port via Canberra late this year.

Pirihi has worked for Cathay for 25 years and said inbound traffic was driving capacity in the first instance but Kiwis' ingrained and growing love of overseas travel habits were also driving demand.

``It's added competition that we've got to face and we'll do that against other carriers from China and the US that we didn't have a few years ago."

Cathay, whose strong passenger yields from New Zealand operations have contributed to the airline's best annual results in five years, increased capacity between Hong Kong and Auckland over summer. supplementing year round daily services with a Boeing 777 aircraft.

Pirihi said the airline was now working on its plans for next summer when it would use the Airbus A350XWB on the Auckland route. It is on track to be the first airline flying to this country to use the revolutionary new plane - which has several of the same features as the Boeing 787 Dreamliner.

The new Airbus A350 performs at the Dubai Airshow. Cathay is planning to fly the new jet to New Zealand later this year. Photo / Getty

Cathay Pacific has a strategic agreement with Air New Zealand for flights between Auckland and Hong Kong.

While capacity is surging among existing and new airlines which is keeping a lid on fares or pushing them down, New Zealand is on course to seek agreements to allow links to more countries and through different routes.

This country has about 70 Air Services Agreements in place and has been signing them at the rate of about 10 a year.

Transport Minister Simon Bridges said he was likely later this month to seek cabinet approval for a tranche of new deals.

It's added competition that we've got to face and we'll do that against other carriers from China and the US that we didn't have a few years ago.

Cathay Pacific country manager Mark Pirihi

"The new Qatar flight is a great example of the necessity of getting these agreements in place. As soon as we learned that Qatar was interested we moved heaven and earth to get an ASA in place."

Auckland Airport estimates Qatar's new daily service will deliver 189,070 seats to the route and contribute $198 million to the New Zealand economy.

Bridges said his government was "on a mission" to increase the number of air services argreements to help boost the economy and provide more options for New Zealand travelers.