Cathay challenge to Air NZ's China plan

Cathay Pacific has improved access to mainland China after buying Dragonair and lifting its stake in Air China last week. Picture / Reuters.

Cathay Pacific has pre-empted Air New Zealand's entrance into the Chinese market by boosting flights to Hong Kong just weeks before the national carrier's Chinese service is due to start.

Both airlines are seeking a larger slice of the forecast major inbound business and tourism growth from China over the next five years.

Hong Kong-based Cathay Pacific said yesterday that it would double its Auckland to Hong Kong flights from once daily to twice daily from October, boosting total Auckland-Hong Kong capacity to 679 seats a day.

The move comes just ahead of Air NZ's introduction of its thrice-weekly direct flights from Auckland to Shanghai in November - the first direct flights between New Zealand and mainland China.

Cathay Pacific usually boosts services between Hong Kong and New Zealand during the peak travel season between November and April. This year services will be lifted to 14 a week from 12 last year.

Cathay's New Zealand and Pacific Islands manager, David Figgins, said he was confident the airline would be able to fill seats on the route because it had full bookings during the peak season last year.

He denied the move was an attempt to pre-empt Air NZ's direct flights to China. "We can easily fill seats, we have group bookings already. We would have boosted our services regardless of what Air NZ was doing."

Cathay Pacific took full control of major Asian carrier Dragonair and doubled its stake in Air China to 20 per cent late last week, giving the airline better access to link routes into mainland China.

Air NZ group general manager of international services Ed Sims agreed competition would increase but said his airline had a competitive edge in that customers would be able to use their frequent-flyer points.

Air NZ was confident of filling seats from the high growth in inbound and outbound traffic to China. The airline will use Boeing 777s, with a 313-seat capacity, for the route.

The Tourism Research Council predicts arrivals from China will reach 110,000 next year, rising to 188,000 in 2011. More than 45,000 New Zealanders travelled to China in 2004, up 38 per cent.