How Tasman travellers benefit from Air New Zealand's bust-up with Virgin Australia

Qantas and Air NZ now have a domestic codeshare after a bust up with Virgin. Photo / Supplied

One of the biggest airline shake-ups on the Tasman for a decade will result in more choice for travellers and help keep a lid on prices.

From this weekend Virgin Australia and Air New Zealand go their separate ways after a messy bust-up that ended a seven-year relationship.

Each airline is putting more seats and has started new routes on to the Tasman, already regarded as one of the most competitive stretches of water in the world.

Industry experts say travellers who fill around seven million seats a year across the Ditch will be winners.

Auckland Airport's general manager of aeronautical commercial, Scott Tasker, said the break-up meant the end of a two-airline block across the Tasman.

''From a consumer perspective the change is going to be positive effective, going from two airline joint ventures controlling 75 per cent of capacity.''

Air New Zealand with about would now be competing on its own with about 41 per cent of capacity, Qantas and Jetstar will have 34 per cent and Virgin 14 per cent. Other airlines including Air Asia, Latam, and China Airlines will have the remaining 11 per cent, he said.

''Virgin's success on the Tasman beyond the joint venture is going to be very positive for consumers but as a counterbalance to those two other airlines with 75 per cent of seats.''

Besides putting on extra seats, Virgin will now offer meals and stowed bags as part of all tickets. The airline is also setting up a new international lounge network in this country and Australia.

Air New Zealand is doing more flying to Brisbane, is using more widebody planes popular with passengers across the Tasman and would soon be using brand new Airbus A321neos with improved cabins on routes to Australia.

Flight Centre's New Zealand managing director David Coombes said while fuel prices were putting pressure on airlines to raise prices, competitive pressure would work in favour of travellers.

''The Tasman has always been uber competitive and because of that these airlines will be keen to protect their share and grow it — and there's a bit of history there.''

In another move which surprised observers, Air New Zealand did a deal with former rival Qantas to make travel on each other's domestic networks more seamless, co-operate in other areas but will continue to compete fiercely on the Tasman and on other routes.

Coombes said the Qantas deal should work well for Kiwi travellers and allow them to more easily fly deeper into Australia.